Search

Editors

Harry Cassin Publisher and Editor

Andy Spalding Senior Editor

Jessica Tillipman Senior Editor

Richard L. Cassin Editor at Large

Elizabeth K. Spahn Editor Emeritus 

Cody Worthington Contributing Editor

Julie DiMauro Contributing Editor

Thomas Fox Contributing Editor

Marc Alain Bohn Contributing Editor

Bill Waite Contributing Editor

Shruti J. Shah Contributing Editor

Russell A. Stamets Contributing Editor

Richard Bistrong Contributing Editor 

Eric Carlson Contributing Editor

Bill Steinman Contributing Editor

Aarti Maharaj Contributing Editor


FCPA Blog Daily News

« Greens Can't Afford Fines; U.S. Appeals Their Sentences | Main | Schlumberger's Signing Bonus »
Tuesday
Oct122010

U.K. Banks And Nigerian Loot

Banks in Britain accepted deposits from corrupt Nigerian politicians between 1999 and 2005 that included bribe money, and continued the practice even after regulators issued specific warnings, according to a report released Monday by NGO Global Witness.

Barclays, NatWest, RBS, HSBC, and UBS were named in the report.

Robert Palmer of Global Witness said, "Large scale corruption is simply not possible without a bank willing to process payments from dodgy sources, or hold accounts for corrupt politicians."

Global Witness analyzed court documents from litigation in London by the Nigerian government. It sued to recover money looted by two former state governors, Dieypreye Alamieyeseigha of Bayelsa State and Joshua Dariye of Plateau State.

Most of the banks named, according to the report, allegedly helped the former Nigerian dictator Sani Abacha funnel nearly a billion pounds through the U.K. After being cited in 2001 by the U.K.'s Financial Services Authority, the banks were supposed to tighten their AML compliance.

But an English High Court judge found that RBS allowed former governor Alamieyeseigha to deposit £2.7 million into the U.K. Of that, "at least £1.56 million came from bribes paid by a state contractor called Ehigie Edobor Uzamere, currently a Nigerian senator, in order to win a contract to build a fence around the governor's official lodge."

Global Witness said it asked RBS whether it carried out adequate checks on former governor Alamieyeseigha and his funds, but didn't receive a reply. It said a Google search at the time would have disclosed corruption allegations. Anti-money laundering regulations require banks to identify their customers and the source of funds.

Last week in the U.S., the Office of the Comptroller of the Currency issued a Cease and Desist Order against HSBC's American unit. It found "deficiencies with respect to suspicious activity reporting, monitoring of bulk cash purchases and international funds transfers, customer due diligence concerning its foreign affiliates, and risk assessment with respect to politically-exposed persons and their associates."

In February 2009, KBR admitted paying at least $182 million in bribes to Nigerian politicians in exchange for contracts to develop natural gas facilities on Bonny Island. It settled FCPA-related charges brought by the DOJ and SEC for $579 million. Earlier this year, KBR's partners in the deal, Snamprogetti of Italy and Technip of France, paid $365 million and $338 million respectively to resolve FCPA-related charges.

The Global Witness report didn't mention the Bonny Island deal or the bribe money associated with it.

Reader Comments

There are no comments for this journal entry. To create a new comment, use the form below.

PostPost a New Comment

Enter your information below to add a new comment.

My response is on my own website »
Author Email (optional):
Author URL (optional):
Post:
 
All HTML will be escaped. Hyperlinks will be created for URLs automatically.