Freight Forwarder, Oil Companies to Pay $236M to Settle Bribery Charges, Etc.
The Justice Department has announced settlements totaling $156,565,000 with Panalpina World Transport (Holding) Ltd. and its U.S. subsidiary, as well as five oil and gas service companies and subsidiaries, to resolve investigations of Foreign Corrupt Practices Act (FCPA) violations.
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The U.S. Securities and Exchange Commission (SEC) also announced settlements with these companies and one other, which involve civil disgorgement, interest and penalties totaling approximately $80 million.
Panalpina Paid Bribes to Foreign Officials in 7 Countries to Circumvent Import Regulations
According to court documents, Panalpina World Transport (Holding) Ltd., a global freight forwarding and logistics services firm based in Basel, Switzerland, and its U.S.-based subsidiary, Panalpina Inc., admitted that the companies, through subsidiaries and affiliates (collectively, Panalpina), engaged in a scheme to pay bribes to numerous foreign officials on behalf of many of its customers in the oil and gas industry. They did so in order to circumvent local rules and regulations relating to the import of goods and materials into numerous foreign jurisdictions.
Panalpina admitted that between 2002 and 2007, it paid thousands of bribes totaling at least $27 million to foreign officials in at least seven countries, including Angola, Azerbaijan, Brazil, Kazakhstan, Nigeria, Russia and Turkmenistan. Also today, Panalpina’s customers, including Shell Nigeria Exploration and Production Company Ltd. (SNEPCO), Transocean Inc. and Tidewater Marine International Inc., admitted that the companies approved of or condoned the payment of bribes on their behalf in Nigeria and falsely recorded the bribe payments made on their behalf as legitimate business expenses in their corporate books, records and accounts.
DOJ Reaches Agreement With 5 Oil and Gas Companiesto Settle Bribery Charges
Justice has also charged and reached agreement with the following oil and gas companies:
Shell - SNEPCO, a Nigerian subsidiary of Royal Dutch Shell PLC (collectively "Shell") with conspiring to violate the anti-bribery and books and records provisions of the FCPA, and with aiding and abetting a violation of the books and records provisions. To resolve the matter, DOJ and Shell have entered into a deferred prosecution agreement that requires, among other things, SNEPCO to pay a $30 million criminal penalty.
Transocean - Transocean Inc., a Caymans Island subsidiary of Transocean Ltd. (collectively "Transocean"), with conspiring to violate the anti-bribery and books and records provisions of the FCPA; violating the anti-bribery provision of the FCPA; and aiding and abetting the violation of the books and records provisions of the FCPA. DOJ and Transocean have agreed to enter into a deferred prosecution agreement that requires, among other things, Transocean Inc. to pay a $13.44 million criminal penalty.
Tidewater - Tidewater Marine International Inc., a Cayman Island subsidiary of Tidewater Inc. (collectively "Tidewater"), with conspiring to violate the anti-bribery and books and records provisions of the FCPA, and with violating the books and records provisions of the FCPA. Tidewater Inc. is a global operator of offshore service and supply vessels for energy exploration headquartered in New Orleans. DOJ and Tidewater have entered into a deferred prosecution agreement that requires, among other things, Tidewater Marine to pay a $7.35 million criminal penalty.
Pride - Pride International Inc., a Houston-based corporation, and Pride Forasol S.A.S., a wholly owned French subsidiary of Pride International (collectively "Pride") were charged in a criminal information filed today with conspiring to violate the anti-bribery and books and records provisions of the FCPA; violating the anti-bribery provisions of the FCPA; and violating the books and records provisions of the FCPA. DOJ has reached agreement with Pride which require the payment of a $32.625 million criminal penalty.
Noble - Noble Corporation, a Swiss corporation, admitted that it had paid approximately $74,000 to a Nigerian freight forwarding agent, acknowledged that certain employees knew that some of the payments would be passed on as bribes to Nigerian customs officials, and admitted that the company falsely recorded the bribe payments as legitimate business expenses in its corporate books, records and accounts. As part of the non-prosecution agreement entered into with the government, Noble will pay a $2.59 million criminal penalty.
SEC Settles With Panalpina, 6 Oil and Gas Companies in Related Civil Enforcement Actions
In related civil enforcement actions brought by the SEC, Panalpina Inc. agreed to pay approximately $11.3 million in disgorgement of profits; Royal Dutch Shell and a U.S. subsidiary, Shell International Exploration and Production Inc., agreed to pay approximately $18.1 million in disgorgement of profits and prejudgment interest; Transocean agreed to disgorge approximately $7.2 million in profits and prejudgment interest; Tidewater Inc. agreed to pay approximately $8.3 million in disgorgement of profits, prejudgment interest and civil penalties; Pride International agreed to pay approximately $23.5 million in disgorgement of profits and prejudgment interest; Noble Corporation agreed to pay approximately $5.5 million in disgorgement of profits and prejudgment interest; and GlobalSantaFe Corp. agreed to pay approximately $5.85 million in disgorgement of profits and prejudgment interest.