SBM Offshore to Pay $238 Million to Resolve U.S. Bribe Case

(Bloomberg) -- SBM Offshore NV agreed to pay $238 million and its U.S. unit pleaded guilty in Texas to resolve allegations that it bribed officials in five countries, including Brazil and Iraq, according to the Justice Department.

SBM entered into a so-called deferred prosecution agreement with the Justice Department Wednesday in federal court in Houston, as its subsidiary, SBM Offshore USA Inc., admitted that it conspired to violate the anti-bribery provisions of the Foreign Corrupt Practices Act.

The settlement comes three weeks after two former executives, including former Chief Executive Officer Anthony Mace, pleaded guilty to charges related to the Petrobras corruption scandal in Brazil.

“This corrupt scheme involved some of the highest-level executives within the company, spanned five countries, and lasted for more than a decade,” Acting Assistant Attorney General John Cronan said in a statement.

SBM said on Nov. 6 that it had set aside $238 million in anticipation of a fine by the Justice Department.

From 1996 until at least 2012, SBM conspired to violate the FCPA by paying more than $180 million in commissions to intermediaries while knowing that a portion of those funds would be used to bribe officials in Brazil, Angola, Equatorial Guinea, Kazakhstan and Iraq, the Justice Department said.

Influence Payments

SBM made the payments in order to influence those officials and win or retain business with state-owned oil companies in those countries, according to prosecutors. SBM made at least $2.8 billion from projects in those countries, the Justice Department said in a statement.

Mace, a U.K. citizen who pleaded guilty on Nov. 9, approved payments to various Brazilians in an effort to secure lucrative contracts with the oil giant, according to the U.S. He was charged by Brazilian authorities two years ago with corruption and racketeering related to the company's efforts to secure business with Petrobras. SBM leased oil production ships to Petrobras.

Robert Zubiate, a former SBM USA executive, pleaded guilty on Nov. 6. He and Mace are awaiting sentencing.

Lingering Probes

The U.S. reopened its investigation of SBM, an Amsterdam-based operator of offshore storage facilities, after initially clearing it of corruption allegations in 2014, two people familiar with the matter told Bloomberg last year.

At the time, SBM said that it would pay $240 million to Dutch authorities and take remedial measures, without admitting wrongdoing, to settle bribery allegations involving Brazil and two other countries.

The Justice Department took another look at SBM after one of the company's former U.S. employees was charged by Brazilian prosecutors in relation to improper sales practices, the company said in a statement on Nov. 6. SBM said the U.S. was also probing its relationship with Unaoil Monaco SAM, an industry adviser under investigation over alleged corruption.

U.S. authorities are investigating individuals and more than a dozen companies as part of its probe of a scandal that has already led to more than 150 arrests in Brazil, people familiar with the matter told Bloomberg last year.

The nearly four-year examination of corruption surrounding Petrobras has already resulted in a record $3.5 billion penalty levied against Odebrecht SA, Latin America's biggest construction company, and an affiliate.

To contact the reporter on this story: Tom Schoenberg in Washington at tschoenberg@bloomberg.net.

To contact the editors responsible for this story: David Glovin at dglovin@bloomberg.net, Elizabeth Wollman, Peter Blumberg

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