US company admits to bribery, UAE a beneficiary
A California valve company has pleaded guilty in a US federal court to paying bribes to secure contracts in dozens of countries including the UAE. Immediately following the guilty plea, Control Components, a California subsidiary of the UK engineering and manufacturing group IMI, was ordered to pay a criminal fine of US$18.2 million (Dh66.79m) and was placed on court supervised probation for three years.
On Friday, the company pleaded guilty to violating two US laws "in a decade-long scheme to secure contracts in approximately 36 countries by paying bribes to officials and employees of various foreign state-owned companies as well as foreign and domestic private companies," the US justice department said in a statement. The US government said Control Components made "corrupt payments to numerous officers and employees of state-owned and privately-owned customers around the world, including in China, Korea, Malaysia and the United Arab Emirates".
According to the justice department and the company's plea agreement, Control Components paid about $6.85 million in bribes between 2003 and 2007 to state-controlled entities including National Petroleum Construction Company (NPCC) in Abu Dhabi, Korea Hydro and Nuclear Power, the Malaysian national oil company Petronas, and six Chinese energy firms including PetroChina. Control Components admitted to making about 236 corrupt payments that resulted in roughly $46.5m of profits to the company from sales and contracts obtained through the bribes.
In related cases, two former executives of the company, Mario Covino, the director of worldwide factory sales, and Richard Morlok, the finance director, pleaded guilty to conspiring to arrange bribes totalling more than $1.6m. The pair are scheduled to be sentenced next January. Two other firms owned or controlled by the Government of Abu Dhabi were named in Mr Covino's plea agreement: Dolphin Energy and Abu Dhabi Company for Onshore Oil Operations (ADCO).
Four other Control Components officials, including Stuart Carson, the former chief executive, were also charged in the case. Officials of Control Components, IMI, NNPC and ADCO were unavailable yesterday. A Dolphin spokesman was unable to comment immediately. Previously, Dolphin said an initial review of its dealings with Control Components had failed to detect any instances of non-compliance with company procedures; NNPC's legal adviser rejected the prosecutors' claims that company officials had taken bribes; and ADCO's general manager said the company had bought equipment from Control Components, but that all work was competitively awarded.
Dolphin is 51 per cent owned by Mubadala Development, the Abu Dhabi Government's strategic investment company; NNPC is controlled by the Abu Dhabi Government's General Holding Corporation; ADCO is 60 per cent owned by the Abu Dhabi National Oil Company. Last year, IMI developed a new business-conduct code, which is posted on its website and those of subsidiaries including Control Components. email@example.com
Updated: August 1, 2009 04:00 AM