On April 6, 2011, the Justice Department’s Criminal Division announced that JGC Corporation, a Japan-based construction firm, had agreed to pay a $218.8 million criminal penalty to resolve FCPA-related charges for bribing Nigerian government officials to obtain engineering, procurement and construction contracts. JGC is one of four partners in a Nigerian joint venture, TSKJ. The three remaining partners to the TSKJ joint venture are Kellogg Brown & Root Inc. (KBR), Technip S.A. and Snamprogetti Netherlands B.V. With JGC’s criminal penalty, the four companies in the joint venture have paid a total of $1.5 billion in criminal and civil penalties to the DOJ and SEC, far exceeding their profits from the contract awards.
To further their bribery scheme, the TSKJ joint venture hired two agents, Jeffrey Tesler and a Japanese trading company. Between 1995 and 2004, TSKJ paid approximately $132 million to a company controlled by Tesler and more than $50 million to the Japanese trading company to bribe Nigerian government officials, including high-level officials, to obtain government contracts to build LNG facilities in Bonny Island, Nigeria. In March 2011, Tesler pleaded guilty to conspiring to violate and violating the FCPA. He agreed to forfeit $149 million to the U.S. government, the biggest individual forfeiture in history. The DOJ filed a deferred prosecution agreement deferring the prosecution of JGC for two years. JGC also agreed to review and implement a compliance program and to cooperate with the DOJ’s ongoing investigations.
KBR individuals were also indicted for FCPA-related charges in connection with this bribery scheme. KBR’s former CEO, Albert Stanley, and Wojciech Chodan, a former KBR manager in the U.K., pleaded guilty to conspiring to violate the FCPA for their participation in the bribery scheme. Pursuant to his plea deal, Stanley’s preliminary sentence called for 84 months in prison and a restitution payment of $10.8 million. He was released on bail of $100,000 and his jail terms are subject to review based on his cooperation. Chodan agreed to forfeit $726,885 and is scheduled to be sentenced on April 27, 2011.
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