On June 25, 2021, the Department of Justice (“DOJ”) and the Securities Exchange Commission (“SEC”) simultaneously announced that the international engineering and project management firm, Amec Foster Wheeler (“Foster Wheeler” or the “Company”), a subsidiary of John Wood Group, plc, would pay over $41 million for combined criminal and civil Foreign Corrupt Practices Act (“FCPA”) violations.
The violations stemmed from Foster Wheeler’s admission that it had participated in a scheme to pay bribes to decision-makers at Petrobras in support of its effort to win a $190 million contract to design a gas-to-chemicals complex in Brazil. The DOJ identified at least one of the Foster Wheeler employees involved in the scheme as a United States citizen based in Foster Wheeler’s Houston office and that the Company took acts in furtherance of the scheme while located in New York and Texas.
Foster Wheeler entered into a sham agency contract with a Brazilian intermediary company for the purpose of funding bribes to public officials. The bribes were paid through third party agents, including one agent who failed Foster Wheeler’s due diligence process but was allowed to continue to work on the project “unofficially.” After paying over $1 million in bribes, which were not accurately recorded in its books and records, Foster Wheeler was awarded the contract and earned at least $12.9 million in profits from the business.
With regard to the criminal violations, the DOJ charged Foster Wheeler with one count of conspiracy to violate the anti-bribery provisions of the FCPA. The Company agreed to a three year deferred prosecution agreement and a total penalty of $18,375,000.
On the civil side, Foster Wheeler consented to the SEC’s cease-and-desist order finding that the Company violated the anti-bribery, books and records, and internal accounting controls provisions of the FCPA. Foster Wheeler agreed to disgorge $17,656,302 and pay an additional $5,107,985 for prejudgment interest.
The monetary criminal penalty included a 25% reduction from the applicable Sentencing Guidelines, and the SEC’s cease-and-desist order considered the Company’s cooperation with the investigation, immediate engagement in remedial measures (including termination of certain employees), and implementing enhancements to its compliance program. We have previously written about such considerations.
Heather Hatfield represents clients in corporate investigations, white-collar crime investigations and defense involving the Foreign Corrupt Practices Act (FCPA), complex contract disputes, oil and gas litigation ...
Blake Runions assists clients with broad range of business disputes and investigatory matters, including partnership disputes, internal investigations, and commercial litigation.
Prior to joining the Firm, Blake worked in the ...
Jamie Godsey represents public and private corporations, partnerships, and small companies on a broad range of complex business and commercial litigation. Her experience includes a wide variety of matters such as contractual ...
- SEC Announces More Than $16 Million in Whistleblower Awards in August 2021
- Lack of Sufficient Third-Party Diligence and Oversight Leads to $41 Million Penalty for Foster Wheeler
- Biden Administration Plans Increased Enforcement of Compliance Issues
- MoneyGram Settlement Illustrates the Need to Maintain Robust Controls
- Whistleblower Protections Incentivize Development of Strong Anti-Retaliation Programs
- New Action by the CFTC Means Higher Stakes for Commodity Market Participants
- Transparency International’s 2020 Corruption Perceptions Index Indicates Corruption is Affecting COVID-19 Response
- Expected Enforcement Trends under the Biden Administration
- FCPA: 2020 Year-In-Review
- Goldman Sachs Reaches Record $2.9 Billion Settlement of Malaysia FCPA Violations
- September 2021
- August 2021
- July 2021
- June 2021
- May 2021
- April 2021
- March 2021
- February 2021
- January 2021
- November 2020
- October 2020
- September 2020
- August 2020
- July 2020
- June 2020
- May 2020
- April 2020
- March 2020
- February 2020
- January 2020
- November 2019
- October 2019
- September 2019
- August 2019
- July 2019
- June 2019
- May 2019
- April 2019
- March 2019
- February 2019
- January 2019