On December 19, 2008, the Department announced the unsealing of a four count indictment, returned by a federal grand jury in Houston in January 2008, against James K. Tillery, a former executive of Willbros International Inc. (“WII”), a subsidiary of Willbros Group Inc. (“Willbros”), and Paul G. Novak, a former consultant to WII, in connection with their alleged conspiracy to make more than $6 million in corrupt payments to Nigerian and Ecuadorian government officials to secure gas pipeline construction and rehabilitation business from state-owned oil companies in those countries.9 These charges represent the third criminal prosecution involving former executives of Willbros-related entities related to violations of the FCPA,10 and, according to the Department, its investigation is still on going.11 On May 14, 2008, Willbros and WII paid $22 million in criminal fines and entered into a Deferred Prosecution Agreement with the Department as a result of bribe payments to Nigerian and Ecuadorian officials.12 Willbros also paid $8.9 million in disgorgement, plus prejudgment interest of $1.4 million, to resolve a related civil complaint brought by the SEC.13 The indictment against Tillery and Novak, both U.S. citizens, was unsealed after Novak was arrested upon his return to the United States from South Africa. It charges both Tillery, who is still at large, and Novak with violations of the anti-bribery provisions of the FCPA, and conspiracy to violate the FCPA and commit money laundering.14
According to the indictment, from 2002 until January 2005, Tillery was an executive vice president, and, later, president of WII. Novak was allegedly a former employee of WII who later became an oil and gas consultant in Nigeria. The indictment charges that, beginning in late 2003 through March 2005, Tillery and Novak, along with several others, conspired to pay millions of dollars in corrupt payments to Nigerian government officials in order to obtain and retain a $387 million engineering and construction contract for a project known as the Eastern Gas Gathering System (“EGGS”). According to the indictment, payments were made, and others promised by, Tillery and Novak to, among others: (1) officials of Nigeria’s state-owned oil company, the Nigerian National Petroleum Corporation (“NNPC”); (2) the Nigerian National Petroleum Investment Management Services, a subsidiary of NNPC; (3) a Nigerian senior executive branch official; (4) officials of a Nigerian political party; and (5) officials of the company that operated the EGGS joint venture. As described in the indictment, most of the bribe payments were laundered through Novak and his Nigerian consulting company partner.
In addition to the allegations involving Nigeria, the indictment further charges that, from December 2003 through the first half of 2004, Tillery, Novak and other Willbros employees based in South America conspired to make at least $300,000 in corrupt payments to officials of PetroEcuador, the state-owned oil and gas company in Ecuador, and its subsidiary, PetroComercial. The payments were allegedly in exchange for the award of a $3 million project to a WII subsidiary to rehabilitate a gas pipeline running from Santo Domingo to El Beaterio.