Sargeant Marine Inc., a multinational asphalt company, has pleaded guilty to violating the anti-bribery provisions of the Foreign Corrupt Practices Act (FCPA) and has agreed to pay $16.6 million to the U.S. government. Sargeant Marine admitted to three separate bribe schemes in Brazil, Venezuela, and Ecuador, amounting to millions of dollars of bribes paid. The bribes were paid to foreign government officials in exchange for contracts for buying and selling asphalt to state-owned oil companies.
Sargeant Marine Inc. said that it facilitated bribes to South American countries between 2010 and 2018. During this eight-year period, it successfully paid bribes to “a Minister in the Brazilian government, a high-ranking member of the Brazilian Congress, and senior executives at Petróleo Brasileiro S.A.-Petrobras,” according to the U.S. Department of Justice. The company also paid officials at Ecuador’s state-controlled oil company, Petroecuador, for an asphalt contract in 2014. These bribes were usually disguised as consulting fees paid to intermediaries. Once Sargeant Marine received invoices for the fake consulting charges, the intermediaries would move the bribe money to shell companies controlled by the officials. In some cases in Brazil, the bribes were also paid in cash.
In Venezuela, Sargeant Marine admits to paying off four officials for the state-owned oil company Petróleos de Venezuela between 2012 and 2018. In exchange for the bribes, Sargeant Marine received ostensibly merit-based asphalt contracts and insider information. In Venezuela, Sargeant Marine used code names to refer to the oil company officials and insider information.
Daniel Sargeant, a senior executive of the company, and four other employees pled guilty to playing major roles in these bribery schemes. A sixth employee, a trader for the company, pled guilty to his role in the Brazil scheme in 2017.
Sargeant Marine’s guilty plea is another example of the FCPA’s effectiveness in prosecuting international bribery and fraud. While none of the bribes were paid to U.S. officials or paid in the U.S., the FCPA allows the U.S. government to prosecute Sargeant Marine because it is publicly traded on the U.S. stock exchange. Although there is no whistleblower mentioned in the Department of Justice press release, that does not mean a whistleblower was not involved. Whistleblowers often opt to remain nameless in their disclosures. If there is a whistleblower involved, they may be eligible for a large reward based on the size of the penalty Sargeant Marine has agreed to pay to the government.
Read the Department of Justice’s press release here.