Hughes Hubbard & Reed resolved criminal charges against Marubeni Corp. with a "deferred prosecution agreement" and a $54.6 million penalty for the Japanese trading company's role in a bribery scandal. The penalty was only a fraction of the fines paid by the other companies involved in one of the biggest Foreign Corrupt Practices Act (FCPA) enforcement actions in US history.
Marubeni was one of several agents hired by the four-company TSKJ venture to assist in winning contracts to build liquefied natural gas facilities on Bonny Island, Nigeria. The Department of Justice and the Securities and Exchange Commission alleged that the consortium and its agents engaged in a wide-ranging conspiracy to pay bribes to Nigerian officials in order to obtain the contracts. Between 1995 and 2004, the venture was awarded four contracts valued at more than $6 billion.

Members of the TSKJ consortium agreed to pay over $1.5 billion in earlier settlements with the US government. Three individuals have also pleaded guilty to FCPA charges in connection with the Justice Department investigation. For its role as an agent of the TSKJ joint venture, Marubeni was charged with one count of conspiracy and one count of aiding and abetting violations of the FCPA.

Under the terms of January’s “deferred prosecution agreement” with the Justice Department, Marubeni agreed to retain a consultant for two years to review the design and implementation of a compliance program, and to cooperate with ongoing investigations. If Marubeni abides by the terms of the agreement, the Justice Department will dismiss the charges. Marubeni said in a statement the settlement will not “materially” change its financial forecasts.

Derek Adler, Marc Weinstein and Ed Little represented Marubeni.

April 2012