The SEC Files Another Settled FCPA Case

The SEC filed a settled civil injunctive action against Willbros Group, Inc. The complaint also named four former employees: Jason Steph (a supervisory employee in Nigeria), Gerald Jansen (an administrative supervisor in Nigeria), Lloyd Biggers (an employee in Nigeria) and Carlos Galvez (an accounting employee in Bolivia). SEC v. Willbros Group, Inc., Civil Action No. 4:08-CV-01494 (S.D. Tex. May 14, 2008). The Commission’s Litigation Release is here.

The Commission’s complaint charges violations of the anti-bribery, antifraud and books and records provisions based on four schemes. First, in Nigeria, it alleges that beginning in 2003, the company, through Mr. Steph and others, paid over $6 million in bribes to government officials and to employees of a government-controlled joint venture to obtain a contract. A similar scheme was used to obtain a second contract. These two schemes netted the company about $8.9 million in profits.

Second, Messrs. Steph, Jansen, Biggers and others used fabricated invoices to obtain the cash for the bribes. They also bribed Nigerian tax and court officials.

Third, in Ecuador, the defendants paid a $300,000 bribe to officials of a government-owned oil and gas company to obtain a $3 million contract.

Finally, in Bolivia the company, through the actions of the same executive, implemented a fraudulent tax avoidance scheme.

In settling with Willbros Group, the SEC acknowledged the cooperation of the company. The company consented to permanent injunctions prohibiting future violations of the anti-bribery, antifraud and books and records provisions. The Willbros Group also agreed to disgorge $8.9 million in profits plus prejudgment interest.

Although the SEC did not seek a civil penalty, the company agreed to pay a $22 million penalty as part of a settlement with the Department of Justice. In that settlement, the company and its subsidiary entered into a deferred prosecution agreement. Under the agreement, an information alleging violations of the anti-bribery provisions will be dismissed in three years. The company also agreed to have an independent compliance monitor to policies and procedures during the three-year period.

The individuals settled by consenting to injunctions prohibiting various books and records sections of the FCPA. Messrs. Jansen and Galvez agreed, respectively, to pay civil penalties of $30,000 and $35,000, while Mr. Steph has consented to pay a civil penalty in an amount to be determined later by the Court.