$32 Million Fine, But Not for Export Violations

Willbros Group Inc. and Willbros International Inc., a wholly owned subsidiary, have agreed to pay over $32 million in penalties, disgorgement and interested in criminal case with the Department of Justice and with the Securities and Exchange Commission. The companies are both publicly traded and provide construction, engineering and other services in the oil and gas industry.

Between late 2003 into March 2005, Willbros’ employees agreed to make corrupt payments in excess of $6.3 million to Nigerian government officials to obtain and retain a $387 million contract for work on major construction on a gas pipeline project known as the Eastern Gas Gathering System. Other employees based in South America also agreed to pay $300,000 in corrupt payments to Ecuadorian government officials of the state owned PetroEcuador and its subsidiary, Petrochemical, to obtain the Santo Domingo project. The project involved rehabilitation of several kilometers of a gas pipeline in Ecuador.

Willbros’ and its international subsidiary are charged with six criminal counts:

• One count of conspiring to make bribe payments to Nigerian and Ecuadorian officials;
• Two counts of violating the Foreign Corrupt Practices Act in connection with the authorization of corrupt payments;
• Three counts of violating the FCPA by falsifying books and records relating to corrupt payments and a tax fraud scheme.

The Department of Justice has agreed to defer prosecution of all counts of criminal charges of the companies for three years; if the companies abide by all terms of their agreement the Department will dismiss the criminal information when the term of the agreement ends. This decision was made based on the Willbros’ exemplary cooperation, implementation of enhanced compliance policies and procedures, and their engagement of an independent corporate monitor.

More information:

• Willbros Group Agrees to Pay $32.3 Million To Resolve DoJ and SEC FCPA Enforcement Actions (Steptoe & Johnson LLP)