$16 Million in Penalties for Drilling Services Company’s Bribery in Nigeria
The Department of Justice announced April 16 that a drilling services company headquartered in Texas has agreed to pay an $11.76 million penalty to resolve charges that it violated the Foreign Corrupt Practices Act in connection with the bribery of a Nigerian government panel reviewing its adherence to national customs and tax laws. The company will also pay the Securities and Exchange Committee $3.05 million in disgorgement and $1.04 million in prejudgment interest to settle charges that this conduct violated the FCPA’s anti-bribery, books and records, and internal controls provisions.
According to court documents, a separate firm working on the Texas company’s behalf avoided certain costs by fraudulently claiming that the company’s rigs had been exported and then re-imported into Nigeria. A Nigerian government commission later discovered this violation and assessed a $3.8 million fine. Rather than pay the fine, however, the company paid a total of $1.25 million to an intermediary agent who succeeded in reducing the fine to $750,000.
Under a three-year deferred prosecution agreement the company will implement an enhanced compliance program and internal controls capable of preventing and detecting FCPA violations, report periodically concerning its compliance efforts, and cooperate with ongoing DOJ investigations. The department notes that this agreement reflects that the company conducted an extensive, multi-year investigation into the charged conduct; engaged in widespread remediation, including ending its business relationships with officers, employees or agents primarily responsible for the corrupt payments; enhanced scrutiny of high-risk third-party agents and transactions; increased training and testing requirements; and instituted heightened review of proposals and other transactional documents for all the company’s contracts.