A&O Shearman FCPA Digest | In re HMT LLC (2016)

Source Documents

Foreign Official
Unnamed Venezuelan government officials; Employees of Petróleos de Venezuela, S.A. (“PDVSA”), the Venezuelan stated-owned and state-controlled energy company; Unnamed Chinese government officials.

Nature of Business
HMT is a Delaware corporation headquartered in Texas which manufactures, supplies, and services aboveground liquid storage tanks for the petroleum, oil, and gas industries.

Influence to be Obtained
According to the DOJ, from approximately 2002 until 2011, an HMT sales agent allegedly bribed Venezuelan government officials to persuade PDVSA to purchase HMT products. To fund the alleged bribes, an agent for HMT allegedly quoted prices to PDVSA which were substantially higher than the price quoted by HMT. The DOJ claimed that PDVSA paid the inflated prices to HMT, which kept the amount it had quoted the agent, and paid the agent the difference as a “commission” and “subcontracting” fees. The DOJ alleged that a portion of the funds received by the agent was subsequently paid to PDVSA employees and Venezuelan government officials.

Additionally, from approximately 1999 through 2011 an HMT distributor allegedly paid bribes to Chinese government officials in exchange for the purchase of HMT products by Chinese state-owned enterprises.

Enforcement
On September 29, 2016, the DOJ announced that it would decline to bring charges against HMT in exchange for HMT’s agreement to disgorge $2,719,412 in ill-gotten gains.