Marubeni, a Japanese trading company, last week agreed to pay a total of $88 million to the Department of Justice to resolve criminal charges over violations of the Foreign Corrupt Practices Act in connection with bribes paid to foreign government officials in Indonesia.
On March 19, Marubeni pleaded guilty in the U.S. District Court for the District of Connecticut and agreed to pay a criminal fine of $88 million. As part of the plea agreement, Marubeni has agreed to maintain and implement an enhanced global anti-corruption compliance program and to cooperate with the department's ongoing investigation.
“Companies that wish to do business in the United States or with U.S. companies must adhere to U.S. law, and that means bribery is unacceptable,” said Valerie Parlave, assistant director in charge of the FBI's Washington field office. “The FBI continues to work with our international law enforcement partners, as demonstrated in this case, to ensure that companies are held accountable for their criminal conduct.”
According to court filings, Marubeni and its employees participated in a seven-year scheme to pay—and conceal—bribes to high-ranking members of Parliament and Perusahaan Listrik Negara (PLN), the state-owned and state-controlled electricity company in Indonesia, in exchange for securing a $118 million contract, known as the Tarahan project, to provide power-related services in the country. Marubeni then retained two consultants for the purpose of paying bribes to Indonesian officials.
In reaching a resolution, the Justice Department said it considered the following factors:
Marubeni's decision not to cooperate with the department's investigation when given the opportunity;
Its lack of an effective compliance and ethics program at the time of the offense;
Its failure to properly remediate; and
The lack of its voluntary disclosure of the conduct.
“The company refused to play by the rules, [and] then refused to cooperate with the government's investigation,” said then-acting assistant Attorney General Mythili Raman. “Now Marubeni faces the consequences for its crooked business practices in Indonesia.”
The latest settlement follows the completion of Marubeni's obligations under a deferred prosecution agreement entered into with the Justice Department in January 2012 relating to a liquid natural gas project in Nigeria. That DPA required Marubeni to:
Retain a corporate compliance consultant for two years;
Review and enhance its anti-corruption compliance program to ensure that it satisfies standards specified by the Justice Department; and
Report to the Justice Department regarding the results of this review.
Those requirements were completed in January 2014. “At the request of the Justice Department, the related proceeding was dismissed on Feb. 26, 2014,” the company stated.
The charges related to the Tarahan project pre-dated the execution of Marubeni's DPA. Since that time, Marubeni said it has undertaken “extensive efforts to enhance its anti-corruption compliance program, and believes that its current program is robust and effective.”
Although the agreement reached with the Justice Department doesn't require engaging a compliance consultant, the company stated, “Marubeni is taking this matter seriously and commits to continue to thoroughly implement and enhance its anti-corruption compliance program.”