US fines Samsung Heavy Industries US$75 million for bribery

SOUTH KOREA's Samsung Heavy Industries has agreed to pay US$75

29 November 2019 - 19:00

SOUTH KOREA's Samsung Heavy Industries has agreed to pay US$75.5 million to settle a probe by the US Department of Justice into a bribery scheme involving the sale of a $640 million offshore drilling ship to Houston-based ship chartering company Pride International, reports American Shipper.

The shipbuilder admitted to conspiring with others by providing $20 million in commissions to a Brazilian intermediary, knowing that part of the money would be used to bribe officials at Brazil's state-owned energy company Petrobras, according to the US Department of Justice (DoJ).

The Petrobras officials then used the money to 'secure improper business advantages' and cause the energy company to enter into a contract to charter Samsung Heavy's ship from the Houston charterer Pride International, which helped Samsung Heavy execute the sale of the ship, Ensco DS 5.

The bribery and conspiracy, which violated the Foreign Corrupt Practices Act, took place between 2007 and 2013, and involved payments made through banks in Switzerland and Monaco.

'Samsung Heavy Industries caused millions of dollars in corrupt bribe payments to be paid to foreign officials to win business, upsetting what should have been a level playing field for other companies that followed the rules,' US Attorney Zachary Terwilliger of the Eastern District of Virginia.

Samsung Heavy CEO Joon Ou Nam said: 'Many of the events described in our agreement happened more than a decade ago, and the individuals involved are no longer with the company. Over the past years, we have taken extensive steps, at our own initiative, to strengthen our anti-corruption compliance programme to meet the highest standards of compliance and ethics.'

The DoJ acknowledged that the company cooperated with the investigation and took remedial measures, making 'significant enhancements to its compliance programme, including hiring additional compliance staff, implementing enhanced anti-corruption policies and heightened due diligence controls over third party vendors, instituting mandatory anti-corruption training and improving whistleblower policies and procedures.'


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