Enforcement Action

 

Docket or Case Number:    10-cv-2414

Court:    S.D. Texas

Initiation Date:    07/07/2010  Information

Prosecuting Agency:    US Securities and Exchange Commission

Name of Prosecuting Attorneys:   

  • Mark A. Adler, SEC Headquarters
  • Antonia Chion, SEC Headquarters
  • Kara N. Brockmeyer, SEC Headquarters
  • Robert G. Wilson, SEC Headquarters
  • Stanley M. Cichinski, SEC Headquarters
  • Ansu N. Banerjee, SEC Headquarters

Assisting Agencies:    US Department of Justice , Federal Bureau of Investigation , Foreign Government Agency

Type of Action:    SEC Federal Court Proceeding

Origin of the Proceeding:    N/A

Whistleblower:    Unknown

Case Status:    Resolved


Summary

ENI S.p.A. ("ENI") was an Italian multinational oil and gas company headquartered in Rome.

ENI's former subsidiary Snamprogetti was part of a four-company joint venture called TSKJ, which was comprised of Technip of France, Snamprogetti Netherlands B.V. of the Netherlands, Kellogg Brown & Root of the United States, and JGC Corporation of Japan. Between 1995 and 2004, members of the joint venture devised and implemented a scheme to bribe Nigerian government officials to obtain contracts worth over $6 billion to build liquefied natural gas (LNG) production facilities. on Bonny Island in Nigeria 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 (Jeffrey Tesler, who was given $132 million for the purpose of bribing high-level Nigerian officials) and a Japanese trading company (Marubeni, which was given $51 million for the purpose of bribing low-level Nigerian officials) as conduits for the bribes. Total payments to the two agents exceeded $180 million.

On July 7, 2010, without admitting or denying the SEC's allegations, Snamprogetti and ENI consented to the entry of a final judgment permanently enjoining them from violating the anti-bribery, books and records, and internal controls provisions of the FCPA.

Snamprogetti and ENI agreed to be jointly and severally liable for disgorgement of $125 million.

Country(ies) involved:    Nigeria

Sanction to Bribe Ratio:    $125,000,000 / $183,000,000 = 68.31 %

Sanction to Revenue Ratio:    $125,000,000 / $6,000,000,000 = 2.08 %

Sanction to Profit Ratio:    N/A

Number of Related Enforcement Actions (Including This Enforcement Action):    11

Country(ies) involved:    Nigeria

Total $ Bribery Payments:    $183,000,000

Total $ Revenue Generated from Bribery:    $6,000,000,000

Total $ Profit Earned or Expenses Avoided from Bribery:    N/A

Total $ Monetary Sanctions:    $1,715,938,854

Sanction to Bribe Ratio:    $1,715,938,854 / $183,000,000 = (937.67 %)

Sanction to Revenue Ratio:    $1,715,938,854 / $6,000,000,000 = (28.60 %)

Sanction to Profit Ratio:    N/A

Name:    ENI, S.p.A.

Place of Incorporation:    Italy

HQ Country(ies):    Italy

Entity Type:    Public Company

FCPA Claims:    Internal Controls, Primary, Issuer (15 U.S.C. § 78m(b)(2)(B)) ; Books & Records, Primary, Issuer (15 U.S.C. § 78m (b)(2)(A))

Related Claims:    N/A

Statutory Basis for FCPA Jurisdiction:    Issuer


Name:    Snamprogetti Netherlands B.V.

Place of Incorporation:    Netherlands

HQ Country(ies):    Netherlands

Entity Type:    Subsidiary

FCPA Claims:    Anti-Bribery, Primary, Issuer (15 U.S.C. § 78dd-1) ; Books & Records, Primary, Knowing Violation (15 U.S.C. § 78m (b)(5)) ; Books & Records, Primary, Falsification of accounting records (17 C.F.R. § 240.13b2–1) ; Internal Controls, Primary, Knowing Violation (15 U.S.C. § 78m(b)(5)) ; Books & Records, Aiding and Abetting (15 U.S.C. § 78m (b)(2)(A), and/or 15 U.S.C. § 78m(b)(5)) ; Internal Controls, Aiding and Abetting (15 U.S.C. § 78m (b)(2)(B), and/or 15 U.S.C. § 78m(b)(5))

Related Claims:    N/A

Statutory Basis for FCPA Jurisdiction:    Issuer (Agent) ; Person (Books & Records, Internal Controls) ; Aider & Abettor/Cause/Control Person

Period of Bribery:   1994 - 2004

Total Bribery Payments:    $183,000,000

Total Revenue Generated from Bribery:    $6,000,000,000

Total Profit Earned or Expenses Avoided from Bribery:    N/A

Country(ies) involved:    Nigeria

Officials Potentially Influenced (Name; Title; Organization): 

  • Name N/A, Officials; Nigerian National Petroleum Corporation ("NNPC")
  • Name N/A, Officials; Nigeria LNG Limited ("NLNG")

Defendant-Related Entities Involved in the Misconduct:    Snamprogetti Netherlands B.V. - Subsidiary

Third-Party Intermediary:   

  • Marubeni Corporation , Agent/Consultant/Broker
  • Tri-Star Investments Ltd. , Agent/Consultant/Broker

Type of Bribe:   Money

Cash, Wire or Check:    N/A

Purpose of Bribe:    Obtain/retain business

TRANSACTION OVERVIEW
Payments made by the Joint Venture to Tesler for engineering contracts in Nigeria

Period of Bribery:   1994 – 2004

Total Bribery Payments:    $132,000,000

Total Revenue Generated from Bribery:    N/A

Total Profit Earned or Expenses Avoided from Bribery:    N/A

Country(ies) involved:    Nigeria

Officials Potentially Influenced (Name; Title; Organization):  

  • Name N/A, Officials; Nigerian National Petroleum Corporation ("NNPC");
  • Name N/A, Officials; Nigeria LNG Limited ("NLNG");

Defendant-Related Entities Involved in the Misconduct:    Snamprogetti Netherlands B.V. - Subsidiary

Third Party Intermediary:    Tri-Star Investments Ltd. - Agent/Consultant/Broker

Type of Bribe:   Money

Cash, Wire or Check:    N/A

Purpose of Bribe:    Obtain/retain business

TRANSACTION OVERVIEW
Payments made by the Joint Venture to Marubeni for engineering contracts in Nigeria

Period of Bribery:   1994 – 2004

Total Bribery Payments:    $50,000,000

Total Revenue Generated from Bribery:    N/A

Total Profit Earned or Expenses Avoided from Bribery:    N/A

Country(ies) involved:    Nigeria

Officials Potentially Influenced (Name; Title; Organization):  

  • Name N/A, Officials; Nigerian National Petroleum Corporation ("NNPC");
  • Name N/A, Officials; Nigeria LNG Limited ("NLNG");

Defendant-Related Entities Involved in the Misconduct:    Snamprogetti Netherlands B.V. - Subsidiary

Third Party Intermediary:    Marubeni Corporation - Agent/Consultant/Broker

Type of Bribe:   Money

Cash, Wire or Check:    N/A

Purpose of Bribe:    Obtain/retain business

Misconduct by Subsidiary?  Yes


Parent(s):   ENI, S.p.A.

Subsidiary:  Snamprogetti Netherlands B.V.

  • Percentage of Ownership:    100.00 %
  • Direct or Indirect Ownership:    Indirect
  • Parent Had Knowledge of Sub’s Bribery?:    No
  • Subsidiary Expressly Alleged to Be Parent's Agent:    No
  • Parent Liable for Sub Misconduct?:    Yes

M&A Negotiated or Completed During Misconduct, Investigation, or Resolution?     Yes

Type of Transaction:    Other


Successor(s):   Saipem, S.p.A

Predecessor:  Snamprogetti Netherlands B.V.

  • Nature of Misconduct   
    • Misconduct Occurred Solely Pre-acquisition:    Yes
    • Misconduct Occurred Pre- and Post-acquisition, with NO Knowledge and/or Involvement of Successor:    No
    • Misconduct Occurred Pre and Post-acquisition, with Knowledge and/or Involvement of Successor:    No
  • Quality of Due Diligence:    N/A
  • Voluntary Disclosure by Successor in Connection with the Transaction:    No
  • DOJ Opinion Sought in Connection with Transaction:    No
  • Successor Liable for Predecessor Misconduct? :    No

  

Re: ENI, S.p.A.

  • Inadequate internal controls or auditing
  • Inadequate safeguards concerning use of third parties
Re: Snamprogetti Netherlands B.V.
  • Inadequate internal controls or auditing
  • Inadequate safeguards concerning use of third parties

Mitigating Factors Referenced by the Government (Company Defendants):

Defendant Self-Report Cooperation Voluntary Remedial Measures Misconduct Limited to Low Level Individuals Other factors
ENI, S.p.A.          
Snamprogetti Netherlands B.V.          

Aggravating Factors Referenced by the Government (Company Defendants):

Defendant Insufficient Cooperation Insufficient Remedial Measures
ENI, S.p.A.    
Snamprogetti Netherlands B.V.    

Total Monetary Sanctions for the Action:    $125,000,000

Case Status:    Resolved


Disposition:    Consent Agreement

Date of Disposition:    07/07/2010

ENI, S.p.A.

—  Total Monetary Sanctions for Defendant:    $125,000,000

—  Compliance Obligation:    No

—  Reporting Obligation:    No reporting

—  Admission of Guilt/Acceptance of Responsibility:    No


Disposition:    Consent Agreement

Date of Disposition:    07/07/2010

Snamprogetti Netherlands B.V.

—  Total Monetary Sanctions for Defendant:    $125,000,000

—  Compliance Obligation:    No

—  Reporting Obligation:    No reporting

—  Admission of Guilt/Acceptance of Responsibility:    No

    Note: This sanction may have been imposed jointly and severally on multiple defendants, or it may resolve claims against more than one defendant in this proceeding or related proceedings. You should review the case summaries and resolution documents for all related cases to better understand how sanctions were levied against the defendants.

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