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Univ. of Toledo College of Law

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Monday, June 28, 2010

Technip Settles FCPA Charges with SEC and DOJ

The SEC announced a settlement with Technip for multiple violations of the Foreign Corrupt Practices Act (FCPA). The SEC alleged that Technip, a global engineering, construction and services company based in Paris, France, was part of a four-company joint venture that bribed Nigerian government officials over a 10-year period in order to win construction contracts in Nigeria worth more than $6 billion. The SEC also charged that Technip engaged in books and records and internal controls violations related to the bribery.

Technip will pay $98 million to settle the SEC’s charges and deprive the company of its ill-gotten gains. The firm will pay an additional $240 million penalty in separate criminal proceedings announced today by the U.S. Department of Justice. Previously, one of Technip’s joint venture partners, KBR, Inc., and its former parent Halliburton Co., settled to similar charges. Together with Technip’s payment, the combined sanctions of $917 million represent the largest combined settlements ever paid to date to the U.S. resulting from an FCPA violation. Technip’s American Depository Shares traded on the New York Stock Exchange from August 2001 to November 2007.

The SEC alleges that between at least 1995 and 2004, senior executives at Technip and other members of TSKJ, a four-company joint venture that includes KBR, Inc., devised and implemented a scheme to bribe Nigerian government officials to obtain multi-billion dollar contracts to build liquefied natural gas (LNG) production facilities. According to the SEC’s complaint, from the inception of the joint venture, Technip and the other joint venture partners paid bribes to assist in obtaining the LNG contracts. The joint venture partners formed a “cultural committee,” comprised of senior sales executives at each company, to consider how to carry out the bribery scheme. To conceal the illicit payments, the joint venture entered into sham contracts with a shell company controlled by a U.K. solicitor and a Japanese trading company as conduits for the bribes. Total payments to the two agents exceeded $180 million.

In the related criminal proceeding announced today, the U.S. Department of Justice filed a criminal action against Technip, charging one count of conspiring to violate the FCPA and one count of violating the anti-bribery provisions of the FCPA. Technip has entered into a deferred prosecution agreement with the DOJ and agreed to pay a criminal penalty of $240 million.

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