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FCPA Blog Daily News

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Wednesday
Jun112014

Key Energy bribe probe expands to Mexico

Key Energy Services Inc. said it is investigating allegation of possible bribery involving its Mexico operations.

As reported by Petro Global News, the Houston-based firm said in an SEC filing last week that it learned about the allegations in April and has conducted an initial investigation into potential violations of the FCPA and other laws.

In May, Key said the SEC is investigating potential violations of the FCPA involving its Russian business.

Key Energy made a voluntary disclosure about the Mexico allegations and its investigation to the SEC and the Justice Department on May 30, it said, and is  fully cooperating with both agencies.

The company provides onshore energy production services. It said last week its board has formed a special committee to oversee the investigations of both its Mexican and Russian operations.

“The special committee has retained external independent legal counsel to continue these investigations,” Key said.

Key employs more than 8,500 people worldwide.

Key Energy Services Inc. trades on the NYSE under the ticker symbol KEG.

It serves customers in the United States, and in Mexico, Colombia, the Middle East and Russia.

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Key Energy's full FCPA disclosure in its Form 8-K filed with the SEC on June 4, 2014 said:

In April 2014, the Company became aware of an allegation involving Key’s Mexico operations that, if true, could potentially constitute a violation of certain Company policies, including our Code of Business Conduct, the U.S. Foreign Corrupt Practices Act (FCPA) and other applicable laws.

The Company conducted an initial investigation of this matter and the Board of Directors of the Company has formed a special committee of independent directors to oversee the investigation of this matter as well as the investigation of previously disclosed possible violations of the FCPA involving business activities of our operations in Russia, and any other resulting matters. The special committee has retained external independent legal counsel to continue these investigations.

On May 30, 2014, the Company voluntarily disclosed the allegation and information from this initial investigation to the Securities and Exchange Commission (SEC) and the Department of Justice (DOJ).

The Company and its management are fully cooperating with the SEC and DOJ; however, at this time the Company is unable to predict the ultimate resolution of these matters with these agencies.

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