Former KBR Consultant Pleads Guilty to Nigerian Bribery Scheme, Agrees to Record Forfeiture

11 March 2011 Publication

On March 11, 2011, Jeffrey Tesler, a former consultant to Kellogg, Brown & Root Inc. (KBR) and its joint venture partners, pleaded guilty to conspiring to violate the Foreign Corrupt Practices Act (FCPA) and to violating the FCPA. According to the DOJ, Tesler was part of a decade-long scheme to bribe Nigerian government officials in exchange for contracts worth $6 billion to build liquefied natural gas (LNG) facilities on Bonny Island, Nigeria.

Tesler, a United Kingdom citizen and licensed solicitor, was originally charged on February 17, 2009. He was extradited from the U.K. on March 10, 2011. Sentencing has been scheduled for June 22, 2011. He faces a maximum penalty of five years in prison on the conspiracy charge and five years in prison on the FCPA violation charge. As part of his plea agreement, Tesler has agreed to forfeit $148,964,568. This constitutes the largest FCPA-related forfeiture against an individual to date.

KBR, Technip S.A. (Technip), Snamprogetti Netherlands B.V. (Snamprogetti) and a Japanese engineering and construction company were part of a four-company joint venture called TSKJ. TSKJ was awarded a series of contracts by Nigeria LNG Ltd. between 1995 and 2004 to build LNG facilities on Bonny Island. Tesler admitted that from approximately 1994 through June 2004, he and his co-conspirators agreed to pay bribes to Nigerian government officials, including top-level executive branch officials, in order to obtain and retain the contracts. The joint venture hired Tesler as a consultant to pay bribes to high-level Nigerian government officials and hired a Japanese trading company to pay bribes to lower-level Nigerian government officials. During the course of the bribery scheme, the joint venture paid approximately $132 million in consulting fees to a Gibraltar corporation controlled by Tesler and more than $50 million to the Japanese trading company. Tesler admitted that he used the consulting fees he received from the joint venture, in part, to pay bribes to Nigerian government officials.

Related enforcement actions:

  • TSKJ joint venture partner KBR pleaded guilty in February 2009 to violating the FCPA. For more information on this guilty plea, see our post here.
  • TSKJ joint venture partner Snamprogetti settled FCPA related charges in July 2010. For more information, see our post here.
  • TSKJ joint venture partner Technip settled FCPA related charges in June 2010.
  • KBR's former CEO, Albert Stanley, pleaded guilty in September 2008 to conspiring to violate the FCPA and to mail and wire fraud. For more information, see our post here.
  • KBR's former commercial VP and consultant, Wojciech J. Chodan, pleaded guilty in December 2010 to conspiring to violate the FCPA. For more information, see our post here.

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