Brazilian Government Corruption lawsuits under the Foreign Corrupt Practices Act by Foreign Corrupt Practices Act Whistleblower Lawyer Jason S. Coomer
Brazilian government corruption comes in many forms. When government officials break the law, for example, by taking bribes For oil leases and government procurement contracts, it violates the foreign corrupt practices act and forms the basis For Brazilian bribe whistleblower reward lawsuits that pay large rewards to the whistleblowers.
If you are aware of significant contract bribes, illegal kickbacks or other corrupt practices by foreign companies and/or multinational corporations, please feel free to contact Brazilian Illegal Bribe and Kickback Whistleblower Reward Lawyer Jason Coomer via e-mail message or use our submission form to inquire about a potential Brazilian Illegal Contract Bribe Whistleblower Reward Bounty Action.
With the rapidly expanding Brazilian economy, foreign direct investments into Brazil, and Brazilian companies expanding into other countries, have come allegations of government official bribes, government agent kickbacks, fraud, embezzlement, and other forms of corruption. Included in these Brazilian government corruption scandals are several government officials that are being forced to resign, while other government officials in President Dilma Rousseff’s cabinet are under investigation for government corruption. In the aftermath of these corruption scandals, the Brazilian Congress is in the process of enacting new law that would dramatically strengthen the Brazilian foreign bribery laws. The foreign anti-bribery law is part of a global trend where governments around the world are cracking down on large corrupt multinational corporations that are offering bribes and kickbacks to government officials in order to obtain large government contracts, avoid health & safety regulations, bypass environmental laws, and exploit populations in foreign countries.
The Foreign Corrupt Practices Act (FCPA) and other Anti-Bribery laws prohibit bribes by multinational corporations to foreign officials to obtain lucrative contracts. Confidential Bribe Whistleblowers that properly report these illegal contract bribes, kickbacks, and other corrupt practices may recover large rewards for exposing corrupt practices committed by multinational corporation. If you are aware of significant contract bribes, illegal kickbacks or other corrupt practices by foreign companies and/or multinational corporations, please feel free to contact Brazilian Illegal Bribe and Kickback Whistleblower Reward Lawyer Jason Coomer via e-mail message or use our submission form to inquire about a potential Brazilian Illegal Contract Bribe Whistleblower Reward Bounty Action.
Potential for Whistleblower exposure of Corruption in the Brazilian Oil and Energy Industries
A key Brazilian industry is the petrochemical industry. With large natural reserves of oil and gas combined with foreign direct investments of technology, Brazil will soon pass China and the United Arab Emirates to become world's fifth largest oil producing nation, only behind Russia, Saudi Arabia, the USA and Iran. Much of Brazil's oil and gas production comes from offshore drilling in deep water reserves. Included in these deep water oil and gas reserves is the Santos Basin, which is located in the south Atlantic Ocean. The Santos Basin is approximately 300 kilometers south east of Sao Paulo and is one of the world's largest oil prospects. The Santos Basin is situated in deepwater and includes two of the largest oil fields to be discovered in recent times: Tupi (2006) and Jupiter (2008). The Santos Basin also has the Carioca/Sugar Loaf field which could contain as many as 40 billion barrels.
Because of the location of Brazil's vast oil and gas reserves, Brazil is seeking and developing deep water drilling technologies including Floating Production, Storage and Offloading (FPSO) technology. The FPSO units are used in remote and deepwater zones where it is neither practical nor cost-effective to lay seabed pipelines from a well to an onshore terminal. Brazil currently has more than 25 FPSOs in operation off the east coast of Brazil and is setting up a domestic FPSO industry.
The production of the Tupi and Jupiter fields combined with the development of production in the Sugar Loaf field should enable the Brazilian Oil Industry to bring in vast amounts of foreign capital into Brazil and allow Brazil to keep advancing its drilling technologies and developing its petrochemical infrastructure. The rigs, platforms and tankers that will service and harvest Brazil's reserves in the coming years will probably be constructed using local suppliers, manpower and facilities instead of outsourcing to third party companies that do not feed directly into the local/national economy, however, deep technology and capital from around the world will be needed to develop the infrastructure and train the work force.
Full exploitation of these vast oil riches will create huge opportunities for Brazil and will help Brazil to become a regional economic power. In fact, it is widely believed that Brazil's oil and gas reserves will catapult the country from an agriculturally-based emerging third world economy to a first world economic power in a matter of years.
The Brazilian energy industry is dominated by the Brazilian multinational energy company, Petrobras. Petrobras is the forth largest company in the world measured by market capitalization. It is also Brazil's semi-public oil company that is public and private hybrid. As Brazil's public oil company, Petrobras has a goal of directing over 50% of its future oil and gas contracts to local Brazilian companies. This protectionist economic policy is designed to help develop the Brazilian petrochemical industry and to limit the influence of foreign multinational oil companies on the Brazilian economy. However, avoiding corruption including Santos Basin lease bribes, Petrobras employee bribes, Brazilian government official bribes, Petrobras oil lease bribes, and other potential Petrobras corruption may prove difficult as the historical culture of Brazilian business and Brazilian government includes substantial corruption.
Petrobras has pledged a $224 billon investment in the Santos Basin through 2014 which should be able to bring in advanced technology and industry from large foreign multinational energy companies. This large amount of investment capital combined with the vast rich Brazilian oil and gas reserves, will bring in fierce competition for these large Brazilian contracts, Brazilian offshore drilling leases, and Brazilian leases. This fierce competition over these huge riches will definitely test the Brazilian government as to if corrupt practices will continue to be common in Brazil or will new anti-bribery laws, whistleblowers, informants, honest Petrobras employees, honest government officials, and honest Petrobras officers be able to manage these resources for the good of the Brazilian economy and Brazilian people and not just for the benefit of those doing the bribing?
As the sole operator in the Santos fields, Petrobras will have significant power in the development of Brazil's petrochemical industry and may be the target of bribes and corruption. Many of the large multinational oil companies including BP are already competing to drill in the rich Bazilian oil and gas fields. BP has already acquired 10 exploration sites in Brazil. Most of these explorations sites are in the Campos basin which according to the Brazilian state oil company Petrobas may have 55 separate oil reserves. The BG Group has also entered into a contract with Petrobras and Petrogal where they have a 25% interest in the Tupi field. Current estimates of the Tupi field are that it contains between five and eight billion barrels of oil and natural gas. The BG Group also has a 30 percent interest with Petrobras and Repsol in other areas of the Santos Basin and other large contracts with with Petrobras. In the future, the BG Group and Petrobras expect to award contracts to as many as three of the large multinational energy conglomerates.
Recent SEC charges against Corruption
SEC charges against six companies were filed in federal court, and one company was charged in an SEC administrative proceeding. Among the SEC's allegations:
Panalpina, Inc. — A U.S. subsidiary of the Swiss freight forwarding giant Panalpina World Transport (Holding) Ltd. (PWT), Panalpina is charged with paying bribes to customs officials around the world from 2002 to 2007 on behalf of its customers, some of whom are included in these settlements. Panalpina bribed customs officials in Nigeria, Angola, Brazil, Russia and Kazakhstan to enable importation of goods into those countries and the provision of logistics services. The bribes were often authorized by Panalpina's customers and then inaccurately described in customer invoices as "local processing" or "special intervention" or "special handling" fees.
Panalpina agreed to an injunction and will pay disgorgement of $11,329,369 in the SEC case. PWT and Panalpina agreed to pay a criminal fine of $70.56 million.
Pride International, Inc. — One of the world's largest offshore drilling companies, Pride and its subsidiaries paid approximately $2 million to foreign officials in eight countries from 2001 to 2006 in exchange for various benefits related to oil services. For example, Pride's former country manager in Venezuela authorized bribes of approximately $384,000 to a state-owned oil company official to secure extensions of drilling contracts, and a French subsidiary of Pride paid $500,000 in bribes intended for a judge to influence customs litigation relating to the importation of a drilling rig.
Pride agreed to an injunction and will pay disgorgement and prejudgment interest of $23,529,718 in the SEC case. Pride and subsidiary Pride Forasol agreed to pay a criminal fine of $32.625 million.
Tidewater Inc. — The New Orleans-based shipping company through a subsidiary reimbursed approximately $1.6 million to its customs broker in Nigeria from 2002 to 2007 so the broker could make improper payments to Nigerian customs officials and induce them to disregard regulatory requirements related to the importation of Tidewater's vessels.
Tidewater agreed to an injunction and will pay $8,104,362 in disgorgement and a $217,000 penalty. Tidewater Marine International agreed to pay a criminal fine of $7.35 million.
Transocean, Inc. — An international provider of offshore drilling services to oil companies throughout the world, Transocean made illicit payments from at least 2002 to 2007 through its customs agents to Nigerian government officials in order to extend the temporary importation status of its drilling rigs. Bribes also were paid to obtain false paperwork associated with its drilling rigs and obtain inward clearance authorizations for its rigs and a bond registration.
Transocean agreed to an injunction and will pay disgorgement and prejudgment interest of $7,265,080. Transocean Ltd. and Transocean Inc. agreed to pay a criminal fine of $13.44 million.
GlobalSantaFe Corp. (GSF) A provider of offshore drilling services GSF made illegal payments through its customs brokers from approximately 2002 to 2007 to officials of the Nigerian Customs Service (NCS) to secure documentation showing that its rigs had left Nigerian waters. The rigs had in fact never moved. GSF also made other payments to government officials in Gabon, Angola, and Equatorial Guinea.
GSF agreed to an injunction and will pay disgorgement of $3,758,165 and a penalty of $2.1 million.
Noble Corporation — An offshore drilling services provider, Noble authorized payments by its Nigerian subsidiary to its custom agent to obtain false documentation from NCS officials to show export and re-import of its drilling rigs into Nigerian waters. From 2003 to 2007, Noble obtained eight temporary import permits with false documentation.
Noble agreed to an injunction and will pay disgorgement and prejudgment interest of $5,576,998. Noble agreed to pay a criminal fine of $2.59 million.
Royal Dutch Shell plc — An oil company headquartered in the Netherlands, Shell and its indirect subsidiary called Shell International Exploration and Production, Inc. (SIEP) violated the FCPA by using a customs broker to make payments from 2002 to 2005 to officials at NCS to obtain preferential customs treatment related to a project in Nigeria.
SIEP and Shell agreed to a cease-and-desist order and will pay disgorgement and prejudgment interest of $18,149,459. Shell Nigerian Exploration and Production Co. Ltd. will pay a criminal fine of $30 million.
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The SEC's investigations were conducted by Jason Rose, Michael King, Tracy L. Price, Denise Hansberry, Laura Josephs, Linda Moran, Amy Friedman, Mathew Hefferan, Moira T. Roberts, Sharan K.S. Custer, Ernesto Palacios and Chedly Dumornay. The Commission acknowledges the assistance of the Department of Justice's Criminal Division-Fraud Section and the Federal Bureau of Investigation.
In developing new markets, large multinational corporations often become extremely competitive to the point where they will violate laws and ethics in the pursuit of advantages to obtain large profits. As Brazil's economy continues to expand many large multinational corporations are attempting to obtain large petrochemical, construction, and infrastructure building contracts. As such, multinational energy, manufacturing, and construction corporations, and many other large multinational corporations are competing for these large Brazilian contracts in the oil exploration construction, pharmaceutical and manufacturing industries. Many corrupt companies may offer bribes to obtain these lucrative Brazilian contracts. In these cases large multinational corporations and their subsidiaries that are registered with the SEC can be held accountable for illegal actions that violate the FCPA.
International businesses and large corporations that are conducting business in a new markets often act through partners in joint ventures to obtain these lucrative contracts. As such, the Foreign Corrupt Practices Act (FCPA) requires compliance departments and anti bribery policies that include strong and clear policies regarding suppliers in the supply chain and mandate that third party business partners such as agents, distributors and joint venture partners also comply with the Foreign Corrupt Practices Act (FCPA).
About Whistleblower Lawyer Jason S. Coomer
As an United States Multinational Corporation Illegal Bribe Whistleblower Bounty Lawyer and United States SEC Multinational Illegal Kickback Whistleblower Reward Lawyer, Jason S. Coomer commonly works with other powerful international business contract bribe whistleblower lawyers and illegal contract kickback whistleblower lawyers across the world to handle large International and Multinational Corporation Bounty Lawsuits, SEC Illegal Bribe Whistleblower Reward Lawsuits, Multinational Oil Company Illegal Kickback Actions, Commodity Fraud Bounty Lawsuits, and other Foreign Corrupt Practices Act Whistleblower Reward Lawsuits. He also works on Medicare Fraud Whistleblower Lawsuits, Defense Contractor Fraud Whistleblower Lawsuits, Stimulus Fraud Whistleblower Lawsuits, Government Contractor Fraud Whistleblower Lawsuits, Medicare Illegal Kickback Lawsuits, Confidential Financial Analyst Whistleblower Reward Lawsuits and other whistleblower recovery lawsuits.
If you are the original source with special knowledge of SEC violations including bribery, kickbacks, or other fraud, and are interested in learning more about a potential lawsuit or becoming a whistleblower under the Foreign Corrupt Practices Act please feel free to contact Brazilian Government Official Illegal Kickback and Bribery Whistleblower Reward Lawyer Jason Coomer via e-mail message or use our submission form