The UK based subsidiary of Kellogg Brown & Root (“KBR”), MW Kellogg Limited (“MWKL”), is to pay £7 million to settle a case with the Serious Fraud Office (“SFO”) connected to bribery and corruption involving its parent company in Nigeria. The agreement will lead to the payment of £7,028,077 within fourteen days in full and final settlement of the case. This sum represents the share dividends due and the interest which has accrued on these sums. The agreement also ensured that MWKL overhauled its internal audit and control measures. MWKL has also agreed to pay the costs of the investigation.
KBR admitted using its UK subsidiary to create a special purpose vehicle (“SPV”) to bid for and run contracts on a gas project in Nigeria, which were obtained using bribes and promises of bribes. Although MWKL was not involved in the criminal activity, it received dividends from the gas project's profits worth over £7 million. The contracts were awarded to a company partly owned by MWKL on behalf of its US parent company.
MWKL reported concerns to the SFO under the "self reporting" scheme and fully co-operated with the subsequent investigation. The SFO, working with the US Department of Justice (“DoJ”), reviewed the conduct of MWKL and decided that the most appropriate approach was to remove the funds which will become due to the company through the unlawful conduct.
Mr. Richard Alderman, Director of the Serious Fraud Office, remarked:
"The SFO will continue to encourage companies to engage with us over issues of bribery and corruption in the expectation of being treated fairly. In cases such as this a prosecution is not appropriate. Our goal is to prevent bribery and corruption or remove any of the benefits generated by such activities. This case demonstrates the range of tools we are prepared to use”.