It's on us. Share your news here.

Keppel Offshore & Marine to Pay Brazil $65M Settling 2016 Bribery Case

Posted on December 21, 2022

Keppel Offshore & Marine (KOM) and the Brazilian Attorney-General and Comptroller General have reached an agreement for the resolution of a case dating back to 2016 and corrupt payments made by a former agent of KOM in Brazil. The company said that with this latest agreement, which is in addition to a 2017 agreement with Brazil, Singapore, and the United States, KOM does not expect further grounds for liability in Brazil in relation to these issues.

As early as 2015 there were rumors of possible bribery payments being made in Brazil by the company’s local agent Zwi Skornicki. The agent was reportedly arrested in February 2016 and Keppel in October 2016 said that it had completed a thorough internal investigation, identifying certain suspicious transactions involving Skornicki and that it was cooperating with the authorities in Brazil and elsewhere to resolve the issues.

The full scope of the corruption came to light in a first-of-its-kind three-way agreement between Brazil, Singapore, and the United States in December 2017. According to admissions and court documents, beginning by at least 2001 and continuing until at least 2014, KOM was involved in paying approximately $55 million in bribes to officials at the Brazilian state-owned oil company Petrobras, and to the then-governing political party in Brazil, in order to win 13 contracts with Petrobras and another Brazilian entity. According to the court papers, KOM effectuated and concealed the bribe payments by paying outsized commissions to an intermediary, under the guise of legitimate consulting agreements, who then made payments for the benefit of the Brazilian officials and the Brazilian political party. KOM USA participated in the conspiracy from approximately 2007 to 2014 and KOM USA pleaded guilty in the Eastern District of New York in connection with the resolution, along with a former senior member of KOM’s legal department in the U.S.

KOM in 2017 agreed to pay a combined total penalty of more than $422 million to resolve charges with authorities in the United States, Brazil, and Singapore. In the new leniency agreement with the Brazilian Attorney-General’s Office and the Comptroller General of the Union, KOM agreed to approximately $65 million in fines and damages. The Attorney-General’s Chambers of Singapore and the Corrupt Practices Investigation Bureau however have agreed in principle to allow KOM to seek crediting of up to approximately $53 million as per the terms of the 2017 agreement.

In Brazil, the AGU and CGU are authorities that have a parallel mandate with the Brazilian criminal authorities to enforce certain anti-corruption laws. Keppel, therefore, was required to engage in a separate negotiation process with those offices following the 2017 agreement which included the Public Prosecutor’s Office in Brazil (Ministerio Publico Federal).

“The leniency agreement results from KOM’s full cooperation with AGU’s and CGU’s investigations, which the two authorities recognized along with KOM’s extensive remediation efforts and significant compliance enhancements in response to the issues involving the former agent in Brazil,” the company said in announcing the agreement. Keppel said that it remains committed to maintaining high ethical standards and robust controls in all its global operations.

Source

It's on us. Share your news here.
Submit Your News Today

Join Our
Newsletter
Click to Subscribe