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Marubeni Corp. to Pay $88M For FCPA Violations in Indonesia

Friday, May 23, 2014

By Jimmy H. Koo  

May 15 — The U.S. District Court for the District of Connecticut May 15 ordered Marubeni Corp.—a Japanese trading company—to pay an $88 million fine, pursuant to an earlier plea agreement, for its role in a scheme to bribe Indonesian officials to win an electricity contract as a part of a joint venture with French power-equipment maker Alstom S.A.  

In the agreement, Marubeni also admitted to violating the Foreign Corrupt Practices Act, agreed to maintain an enhanced anti-corruption compliance program, and agreed to cooperate with the Justice Department's ongoing investigation.

According to the DOJ, Marubeni paid bribes to Indonesian officials in exchange for securing a $118 million contract for the company and its consortium partner—Alstom—to provide power services for Indonesian citizens. To conceal the bribes, Marubeni and Alstom retained consultants to purportedly provide consulting services. In reality, however, the consultants were used as channels to pay bribes to the Indonesian officials, the DOJ said.

In March, Marubeni pleaded guilty to one count of conspiracy to violate the FCPA and seven counts of violating the FCPA. In a May 15 release, the DOJ said that the “plea agreement cites Marubeni's refusal to cooperate” as well as its lack of an effective compliance program. Marubeni was represented by Christopher M. Paparella and Marc A. Weinstein of Hughes, Hubbard & Reed LLP, New York.

Related & Previous Cases

According to the DOJ, four current or former Alstom executives, including Frederic Pierucci, David Rothschild, Lawrence Hoskins and William Pomponi, have been charged with related misconduct. Pierucci pleaded guilty July 2013 to violating the FCPA and conspiring to violate the FCPA; Rothschild pleaded guilty November 2012 to violating the FCPA.

The case is not the first in which Marubeni has faced charges of FCPA violations. In February, it was released from a two-year deferred prosecution agreement—in which, it agreed to pay $54.6 million—for its role in a scheme to bribe Nigerian officials to win a $6 billion contract to build and expand a gas plant.

To contact the reporter on this story: Jimmy H. Koo in Washington at jkoo@bna.com

To contact the editor responsible for this story: Phyllis Diamond at pdiamond@bna.com

To see the sentencing minutes, go to http://www.bloomberglaw.com/public/document/USA_v_Marubeni_Corporation_Docket_No_314cr00052_D_Conn_Mar_19_201/1.

To see the plea agreement, go to http://www.bloomberglaw.com/public/document/USA_v_Marubeni_Corporation_Docket_No_314cr00052_D_Conn_Mar_19_201.

  

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