UK Serious Fraud Office Settlement with M.W. Kellogg Ltd. Reflects Company's "Self-Referral" Efforts
On February 16, 2011, KBR’s wholly-owned subsidiary, M.W. Kellogg Limited (MWKL) settled civil corruption charges with the U.K. Serious Fraud Office (SFO). The conduct at issue related to contracts for work on Nigeria’s Bonny Island project and the TSKJ joint venture. The SFO acknowledged that MWKL took no part in any of the criminal activity but stated that it received share dividends payable from profits and revenues generated by contracts obtained by bribery and corruption undertaken by MWKL’s parent company and others. In order to settle the charges, MWKL agreed to pay $11,238,886 (£7,000,028). This fine is similar to an SEC-imposed disgorgement remedy and represents the total MWKL received as a result of the illicit conduct.
The SFO stated that MWKL self-reported concerns to the SFO under the “self referral” scheme and fully co-operated with the subsequent investigation. The SFO, working in partnership with the US Department of Justice, reviewed the conduct of MWKL and decided that the most appropriate approach was to remove the funds obtained through the unlawful conduct. This reflects the finding that MWKL was not a willing participant in the corruption.
For more information on the underlying conduct, please see our previous posts.
Related enforcement actions:
- Former VP of KBR subsidiary pleads guilty to FCPA violations in December 2010. For more information on this guilty plea, see our post here.
- 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.
- Jeffrey Tesler was indicted with Chodan in February 2009. Tesler is still awaiting extradition. For more information, see our post here.
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