Three Joint Venture Companies Fined $17 Million in Bribery Case

The African Development Bank Group last month levied financial penalties totaling $17 million against three joint venture companies in a bribery case. 

On March 21, the Integrity and Anti-Corruption Department (IACD) of the African Development Bank fined Kellogg Brown & Root $6.5 million; Technip, $5.3 million; and JGC $5.2 million. According to the charges, these companies, together with engineering services provider Snamprogetti, funneled $180 million in bribes from 1995 to 2004 to government officials in Nigeria as part of a multinational joint venture to develop a liquefied natural gas plant in the country.

“This settlement demonstrates a strong commitment from the African Development Bank to ensure that development funds are used for their intended purpose,” said Anna Bossman, director of IACD. “At the same time, it is a clear signal to multinational companies that corrupt practices in bank-financed projects will be aggressively investigated and severely sanctioned.”

The African Development Bank said it will debar for three years the following three companies:

TSKJ—Serviços de Engenharia;

TSKJ II—Construções Internacionais Sociedade Unipessola; and

LNG—Serviços and Gestão de Projetos, based in Madeira, Portugal. 

Furthermore, these companies may face cross debarment under the April 2010 agreement for Mutual Enforcement of Debarment Decisions entered into by the African Development Bank; the Asian Development Bank; the European Bank for Reconstruction and Development; the World Bank Group; and the Inter-American Development Bank Group.

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As Compliance Week previously reported, all four companies previously settled similar charges with the Department of Justice for violations of the Foreign Corrupt Practices Act. Kellogg Brown & Root pleaded guilty in February 2009 to FCPA-related charges for its participation in the scheme, and was ordered to pay a $402 million fine.

In related a criminal case, the Justice Department entered into a deferred prosecution agreement with Technip in June 2010 and agreed to pay a $240 million criminal penalty. One month later, Snamprogetti also entered into a DPA and paid a $240 million criminal penalty, and JGC reached a DPA in April 2011 and agreed to a $218.8 million criminal penalty.