Keppel Offshore & Marine and U.S. based subsidiary to pay $422 million
Staff Writer |
Keppel Offshore & Marine (KOM) and its wholly owned U.S. subsidiary, Keppel Offshore & Marine USA (KOM USA), have agreed to pay a combined total penalty of more than $422 million.
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They will pay to resolve charges with authorities in the United States, Brazil and Singapore arising out of a decade-long scheme to pay millions of dollars in bribes to officials in Brazil.
KOM USA pleaded guilty today in connection with the resolution. In addition, a guilty plea by a former senior member of KOM’s legal department was unsealed.
Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, Acting U.S. Attorney Bridget M. Rohde of the Eastern District of New York, and Assistant Director Stephen E. Richardson of the FBI’s Criminal Investigative Division made the announcement.
KOM entered into a deferred prosecution agreement with the Department in connection with a criminal information filed today in the Eastern District of New York charging the company with conspiracy to violate the anti-bribery provisions of the FCPA.
The case is assigned to U.S. District Judge Kiyo A. Matsumoto. In addition, KOM USA pleaded guilty and was sentenced by Judge Matsumoto on a one-count criminal information charging the company with conspiracy to violate the anti-bribery provisions of the FCPA.
Pursuant to its agreement with the Department, KOM will pay a total criminal fine of $422,216,980, with a criminal penalty due to the United States of $105,554,245, including a $4,725,000 criminal fine paid by KOM USA.
As part of the deferred prosecution agreement, KOM also committed to implement rigorous internal controls and to cooperate fully with the Department’s ongoing investigation.
The United States will credit the amount the company pays to Brazil and Singapore under their respective agreements, with Brazil receiving $211,108,490, equal to 50 percent of the total criminal penalty, and Singapore receiving up to $105,554,245, equal to 25 percent of the total criminal penalty.
The Department also unsealed charges today against a former senior member of KOM’s legal department, who pleaded guilty to one count of conspiracy to violate the FCPA on Aug. 29, 2017 in the Eastern District of New York. He is awaiting sentencing.
According to admissions and court documents, beginning by at least 2001 and continuing until at least 2014, KOM conspired to violate the FCPA by paying approximately $55 million in bribes to officials at the Brazilian state-owned oil company Petrobras and to the then-governing political party in Brazil, in order to win 13 contracts with Petrobras and another Brazilian entity.
KOM effectuated and concealed the bribe payments by paying outsized commissions to an intermediary, under the guise of legitimate consulting agreements, who then made payments for the benefit of the Brazilian officials and the Brazilian political party.
In reaching the resolutions with the Department, KOM and KOM USA received credit for their substantial cooperation with the Department’s investigation and for taking extensive remedial measures.
For example, KOM has terminated and otherwise disciplined employees involved in the criminal conduct, and it has implemented an enhanced system of compliance and internal controls to address and mitigate corruption risks.
Accordingly, the criminal penalty reflects a 25 percent reduction off the bottom of the applicable U.S. Sentencing Guidelines fine range.
The case is being investigated by the FBI’s International Corruption Squad in Houston. Trial Attorneys Derek J. Ettinger and David M. Fuhr and Assistant Chief Christopher J. Cestaro of the Criminal Division’s Fraud Section, as well as Assistant U.S. Attorneys Alixandra Smith and Patrick Hein of the Eastern District of New York, are prosecuting the case.
The MPF in Brazil and the AGC in Singapore provided significant assistance in this matter, as did the Criminal Division’s Office of International Affairs. ■