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Julie DiMauro Contributing Editor

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Bill Waite Contributing Editor

Shruti J. Shah Contributing Editor

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FCPA Blog Daily News

« Libya fund accuses SocGen of paying $58 million in bribes | Main | Former Israel PM Ehud Olmert convicted of bribery »
Tuesday
Apr012014

Enforcement Report for Q1 '14

It was a busy three months for FCPA and related enforcement. Alcoa and a subsidiary landed 5th on the FCPA top ten list with a $384 million settlement. And Japan's Marubeni made the enforcement report for the second time in just over two years.

There were a couple of guilty pleas, four declinations, and a huge forfeiture action against a Nigerian kleptocrat, among other things.

Here's what happened (the dates are when the actions were reported here): 

DOJ / SEC Enforcement Resolutions

Alcoa World Alumina LLC (January 9) pleaded guilty to one count of violating the anti-bribery provisions of the FCPA with a 2004 corrupt transaction. It agreed to pay a criminal fine of $209 million and forfeit $14 million to settle the DOJ’s charges.

Alcoa Inc. (January 9) agreed to resolve civil charges brought by the SEC by disgorging $161 million.

Stephan Signer (February 5), a former executive of Siemens in Argentina, was ordered in a default judgment to pay a $524,000 civil penalty in an enforcement action brought by the SEC.

Ulrich Bock (February 5), a former executive of Siemens in Argentina, was ordered in a default judgment to pay a $524,000 civil penalty in an enforcement action brought by the SEC. Bock was also ordered to pay an additional $413,957 for disgorgement.

Marubeni Corporation (March 20) of Tokyo, Japan paid a fine of $88 million after pleading guilty to one count of conspiracy to violate the FCPA and seven substantive FCPA offenses. It admitted bribing Indonesian officials to win an electricity contract for itself and its partner, Alstom SA. Marubeni paid a $54.6 million criminal penalty in early 2012 to resolve FCPA charges for its role as an agent of the KBR-led TSKJ joint venture.

Indicted / Arrested

Joseph Sigelman (January 6) former co-CEO of PetroTiger Ltd., a British Virgin Islands oil and gas company with operations in Colombia and offices in New Jersey, was charged with FCPA-related offenses, fraud, and money laundering. He allegedly bribed an official at Ecopetrol SA, Colombia’s state-controlled oil company, to win a services contract worth $39 million.

Guilty Pleas

Gregory Weisman (January 6), the former general counsel of PetroTiger Ltd., pleaded guilty to bribery and fraud.

Knut Hammarskjold (February 18) former co-CEO of PetroTiger Ltd., pleaded guilty in federal court in Camden, New Jersey to one count of conspiracy to violate the FCPA and to commit wire fraud. He's scheduled for sentencing on May 16.

Charges Dismissed

Elek Straub, Andras Balogh, and Tamas Morval (March 11), former executives of Magyar Telekom, the Hungarian unit of Deutsche Telekom, had some charges brought by the SEC dismissed. The SEC dropped allegations about bribing officials in Montenegro. Other allegations concerning bribes to government officials in Macedonia are still pending.

Mark A. Jackson and James J. Ruehlen (March 31), the former CEO of Noble Corporation, and the head of Noble’s Nigeria unit, had some charges dismissed by the SEC. The SEC dropped internal controls charges in a civil FCPA action to “streamline the presentation” of the case, the agency said. Jackson and Ruehlen still face other charges. Their trial is set for July.

Declinations (disclosed investigations by the DOJ or SEC or both followed by either or both agencies declining to bring an enforcement action)

LyondellBasell Industries NV (February 20), a Netherlands-based petrochemical maker, said the DOJ closed its investigation into a payment made in Kazakhstan that had raised compliance concerns. The company had disclosed the investigation in late 2012. The DOJ ended its investigation without assessing any fine or penalty.

Baxter International (February 21) said the DOJ and SEC closed their FCPA investigations and won't take further action. Baxter disclosed in 2010 that it received inquiries from the SEC and DOJ requesting information about business activities in “a number of countries” as part of an industry-wide FCPA investigation.

Merck (March 3) said the DOJ closed its FCPA investigation of the company. Merck first disclosed in 2010 that it received letters from the DOJ and SEC asking for FCPA-related information about its activities in a number of countries.

SL Industries Inc. (March 21) said the DOJ dropped its FCPA probe without filing charges. SL Industries first disclosed an internal investigation in May 2012. The investigation focused on whether employees of three China subsidiaries had improperly provided gifts and entertainment to government officials. The company said it had contacted the DOJ and the SEC "voluntarily to disclose . . . an internal investigation, and agreed to cooperate fully."

DOJ Release

DOJ Opinion Procedure Release 14-01 (March 24). The Requestor was "a United States financial services company and investment bank." The DOJ gave the OK for the Requestor to buy the shares of an overseas partner who had become a foreign official.

Related Enforcement Actions

General Sani Abacha (March 6), former president of Nigeria, was the subject of a civil forfeiture action brought under the DOJ's Kleptocracy Asset Recovery Initiative. More than $458 million in corruption proceeds hidden in bank accounts around the world by former Nigerian dictator Sani Abacha and his co-conspirators were frozen.

Frederic Cilins (March 10), a French citizen, pleaded guilty in the Southern District of New York to obstructing a federal criminal investigation into whether a mining company paid bribes to win mining rights in the Republic of Guinea. Cilins admitted he agreed to pay money to induce a witness to destroy documents sought by the FBI. The documents related to allegations of bribes to obtain mining concessions in the Simandou region of the Republic of Guinea, located in West Africa.

Alfonso Portillo (March 19), the former president of Guatemala, pleaded guilty in federal court in New York to taking $2.5 million in bribes from Taiwan in exchange for continuing to recognize the country diplomatically. He was extradited from Guatemala by the United States.

*     *    *

Our prior enforcement reports are here:

2013 FCPA Enforcement Index

2012 FCPA Enforcement Index

2011 FCPA Enforcement Index

2010 FCPA Enforcement Index

2009 FCPA Enforcement Index

2008 FCPA Enforcement Index

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Richard L. Cassin is the publisher and editor of the FCPA Blog. He can be contacted here.