Amec Foster Wheeler Energy Limited (Amec Foster Wheeler or the Company), a subsidiary of John Wood Group plc (Wood), a United Kingdom-based global engineering company, has agreed to pay $18,375,000 to resolve criminal charges stemming from a scheme to pay bribes to officials in Brazil in exchange for an approximately $190 million contract to design a gas-to-chemicals complex.
According to court documents, Amec Foster Wheeler entered into a three-year deferred prosecution agreement (DPA) with the U.S. Justice Department, Criminal Division, Fraud Section and the U.S. Attorney’s Office for the Eastern District of New York in connection with the filing of an information charging the Company with conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act (FCPA).
“Amec Foster Wheeler has now admitted to paying bribes in Brazil to win a lucrative contract,” said Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division. “In the pursuit of profits, the company resorted to corruption, which distorts markets and undermines the rule of law. Today’s resolution, including the financial penalty and agreement to enhance compliance, underscores the Department of Justice’s commitment to holding companies accountable when they break the law and to rooting out criminal misconduct.”
“Amec Foster Wheeler conspired to pay bribes to officials in Brazil as part of a corrupt scheme to obtain a $190 million government contract and generate millions of dollars in profits,” said Acting U.S. Attorney Jacquelyn M. Kasulis for the Eastern District of New York. “The defendant’s lengthy DPA and agreement to pay a penalty of more than $18 million demonstrate the commitment of this office to enforcing the anti-bribery provisions of the FCPA and holding companies like Amec Wheeler Foster accountable for its illegal conduct and corporate greed.”
“Today’s announcement demonstrates the FBI’s dedication to work with our international partners in the global effort to hold individuals and companies accountable who may believe corruption is the only way to do business,” said Assistant Director in Charge Steven M. D’Antuono of the FBI’s Washington Field Office. “When companies like Amec Foster Wheeler attempt to cheat the system, it creates an uneven playing field for businesses who don’t pay bribes. This deferred prosecution agreement, which includes both a substantial criminal penalty and other provisions, should serve as a warning to companies that even using a third-party intermediary to pay bribes will not preclude them from being held responsible for international corruption.”
According to the Company’s admissions in the DPA, between 2011 and 2014, Amec Foster Wheeler conspired with others, including an Italian sales agent affiliated with a Monaco-based intermediary company, to pay bribes to decision-makers at Petrobras in order to win an approximately $190 million contract from Petrobras to design a gas-to-chemicals complex in Brazil called Complexo Gás-Químico UFN-IV. The Company, through certain of its employees and agents, took acts in furtherance of the scheme while located in New York and Texas, and earned at least $12.9 million in profits from the corruptly obtained business.
As part of the DPA, for a three-year period, Amec Foster Wheeler agreed to continue to cooperate with the U.S. government in any ongoing or future criminal investigations concerning Amec Foster Wheeler or its executives, employees or agents. In addition, under the agreement, Amec Foster Wheeler and its parent company, Wood, agreed to enhance their compliance programs and to report to the government on the implementation of their enhanced compliance programs.
The government reached this resolution with Amec Foster Wheeler based on a number of factors, including the Company’s failure to voluntarily and timely disclose the conduct that triggered the investigation; the nature and seriousness of the offense, which spanned multiple years and involved a high-level executive; and credit for the Company’s cooperation. The Company also engaged in remedial measures, including terminating an individual involved in the misconduct, and adopting heightened controls and anti-corruption procedures. Accordingly, the criminal penalty reflects a 25% reduction off the applicable U.S. Sentencing Guidelines fine for the Company’s full cooperation and remediation.
In related proceedings, the Company has received provisional court approval for a settlement with the United Kingdom’s Serious Fraud Office and has settled with the Ministério Público Federal (MPF), the Controladoria-Geral da União (CGU), and the Advogado-Geral da União (AGU) in Brazil. Under the DPA, the Fraud Section and the Eastern District of New York will credit up to 25% ($4,593,750) of the criminal penalty owed to the United States to payments the Company makes pursuant to the resolution with the United Kingdom’s Serious Fraud Office, and up to 33% ($6,125,000) of the criminal penalty owed to the United States to payments the Company makes pursuant to the resolution with Brazilian authorities.
In a related civil matter with the U.S. Securities and Exchange Commission (SEC), a subsidiary of Wood has agreed to pay the SEC disgorgement and prejudgment interest totaling approximately $22.7 million for the conduct in Brazil.
The FBI’s Washington Field Office is investigating the case. The United Kingdom’s Serious Fraud Office and Brazil’s MPF, CGU, and AGU provided significant assistance.
Assistant Chief Gerald M. Moody Jr. and Trial Attorney Dennis Kihm of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Julia Nestor of the Eastern District of New York are prosecuting the case.
The Fraud Section is responsible for investigating and prosecuting all FCPA matters. Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal-fraud/foreign-corrupt-practices-act.