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Petrofac Resolves Bribery Act Enforcement Action

Petrofac

Petrofac (a U.K. based oil and gas company with ADRs registered with the SEC) has been under scrutiny since 2016 regarding its relationship with Unaoil. (See here for the prior post).

In 2019, the U.K. Serious Fraud Office announced that David Lufkin (the former Global Head of Sales for Petrofac International Ltd.) pleaded guilty to eleven counts of bribery related to “the making of corrupt offers to influence the award of contracts to Petrofac worth in excess of USD $730 million in Iraq and in excess of USD $3.5 billion in Saudi Arabia.” (See here).

Recently, the SFO announced that it has “secured the conviction of Petrofac Limited for seven separate counts of failure to prevent bribery between 2011 and 2017.”

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Same General Script, As DOJ Charges Individual In Connection With Alleged Bribes In Venezuela

wakil

You have likely read the script many times in the last several years.

An individual associated with small privately-held companies does business in Venezuela and paid alleged bribes (and/or laundered money) in connection with the bribery scheme.

The script repeated itself yesterday as the DOJ announced that Naman Wakil (pictured), a Syrian national and U.S. lawful permanent resident, was “arrested in Miami on charges related to his alleged role in a scheme to bribe Venezuelan officials and launder funds to obtain contracts from Venezuela’s state-owned and state-controlled energy company, Petróleos de Venezuela S.A. (PDVSA), and Venezuela’s state-owned and state-controlled food company that purchased food for Venezuela, Corporación de Abastecimiento y Servicios Agrícola (CASA).”

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Former Glencore Trader Pleads Guilty To FCPA And Related Offense

glencore

As highlighted in this prior post, for approximately two years Glencore (a commodities company incorporated in the United Kingdom and headquartered in Switzerland with common stock that trades on the New York based over-the-counter market) has been under scrutiny for conduct in Nigeria, the Democratic Republic of Congo, and Venezuela (as well as perhaps other countries).

Earlier this week Anthony Stimler pleaded guilty to FCPA and money laundering offenses. Stimler is described as a United Kingdom citizen and resident who was a trader at a Glencore subsidiary who worked on the West Africa desk from in or around 2002 until in or around 2009 and then again from in or around June 2011 until in or around August 2019. According to the DOJ “In that role, Stimler had responsibility for crude oil purchases from, among other places, Nigeria, and acted on behalf of Company 1 [Glencore] in procuring crude oil from Nigeria.”

In summary fashion, the criminal information alleges:

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Across The Pond, Amec Foster Wheeler / Wood Group Resolves £103 Million U.K. Enforcement Action

WoodFoster

Previous posts here and here focused on the recent net $17.7 million FCPA enforcement action against Amec Foster Wheeler and John Wood Group concerning conduct in Brazil.

In a parallel enforcement action, the U.K. Serious Fraud Office also announced that Amec Foster Wheeler and John Wood Group will pay “a financial penalty and costs amounting to £103 million in the UK.”

The enforcement action involved a ten count Indictment. One count (Count 10) concerned the same Brazil conduct at issue in the FCPA enforcement action and charged failure to prevent bribery, contrary to section 7 of the Bribery Act 2010.

The other nine counts in the Indictment (concerning conduct in Nigeria, Saudi Arabia, Malaysia, and India) charged conspiracy to make corrupt payments, contrary to section 1(1) of the Criminal Law Act 1977 and section 1 of the Prevention of Corruption Act 1906. The conduct at issue in these counts allegedly between 1996 and 2010 (in other words 11-25 years prior to the enforcement action).

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U.K. Companies Resolve Net $17.7 Million FCPA Enforcement Action Concerning Conduct In Brazil

WoodFoster

Approximately 7-10 years ago, a U.K. corporation (#1) engaged in alleged improper conduct with alleged Brazilian officials largely through a Brazilian intermediary company with the assistance of an Italian agent. Approximately 7 years ago, a different U.K. corporation (#2) acquired U.K. corporation #1 and then approximately 4 years ago another U.K. corporation (#3) acquired U.K. corporation #2.

And then, the U.S. government brought an FCPA enforcement action against U.K. corporation #1 because, at one time, the company had shares traded on NASDAQ – even though in connection with the same core conduct the U.K. Serious Fraud Office and Brazil law enforcement also brought an enforcement action.

That pretty much sums up last Friday’s net $17.7 million FCPA enforcement action against Amec Foster Wheeler Energy, which was acquired by Amec Plc in 2014, which in turn, was acquired by John Wood Group Plc in 2017.

The enforcement action was the first corporate FCPA enforcement action of the Biden administration and closed the approximate six month gap in corporate FCPA enforcement.

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