In the Matter of Statoil, ASA (2006)

• Case Name
• In the Matter of Statoil, ASA (2006)

• Date Filed
• 10/13/2016

• Enforcement Agency
• SEC

• Countries
• Iran

• Foreign Official
• Head of a subsidiary organization of the national oil company.

• Date of Conduct
• 2002 to 2003

• Nature of Business
• Provision of oilfield development services by Statoil, Norway’s largest oil and gas company.  Statoil is a foreign issuer listed on the New York Stock Exchange. 

• Influence to be Obtained
• From 2000, Statoil sought to expand its international operations with a focus on Iran.  In 2001, high‑level Statoil officials met with the head of the Iranian Fuel Consumption Optimizing Organization, a subsidiary of the National Iranian Oil Company.  The Iranian official, the son of a former President of Iran, was determined to be highly influential in the award of oil and gas business in Iran.  In 2002, Statoil entered into a $15.2 million contract with Horton Investments, Ltd., a small consulting firm in Turks & Caicos and owned by a third‑party in London, to provide payments to the Iranian official, of which $200,000 was paid in June 2002.  The Iranian official used his influence to secure a contract for Statoil in October 2002 to develop the South Pars oil and gas field, a contract which would yield “millions of dollars in profit.”  In December 2002, Statoil paid an additional $5 million to the official.
  
  In 2004, Statoil’s internal audit department uncovered and reported the existence of the consulting contract and the $5.2 million payments to the company’s CFO, who ordered an investigation.  Statoil’s security group and internal audit group prepared a report concluding that the company may have violated U.S. and Norwegian bribery laws and recommended that the contract be terminated immediately.  Nevertheless, Statoil’s CEO and the Chairman of its Board took no corrective action. 
  
  Three senior executives at Statoil have resigned:  its chairman Leif Terje Loeddesoel, chief executive officer Olav Fjell, and executive vice president Richard Hubbard.

• Enforcement
• Statoil has consented to a cease‑and‑desist order and to pay $10.5 million in disgorgement and to retain a compliance monitor for three years.  In the DOJ proceeding, Statoil entered a three‑year deferred prosecution agreement and agreed to pay a $10.5 million penalty.  Statoil has already paid a NOK 20 million ($3.045 million USD) fine to the Norway National Authority for Investigation and Prosecution of Economic Crime, without admitting or denying any liability, which will be deducted from the U.S. fines.  On October 18, 2004, Richard Hubbard accepted a fine of NOK 200,000 ($30,300).

• Amount of the Value
• $5.2 million.

• Amount of Business Related to Payment
• Not Stated

• Intermediary
• Offshore intermediary company consultant.

• Total Sanction
• $ 10,500,000

• Compliance Monitor
• Yes

• Reporting Requirements
• No

• Case is Pending?
• No

• Total Combined Monetary Sanction
• $ 21,000,000

• Related Enforcement Actions
• United States v. Statoil ASA (S.D.N.Y. 2006)
  

Statoil, ASA 

• Citation
• In the Matter of Statoil ASA, Admin. Proc. File No. 3-12453 (Oct. 13, 2006).

• Date Filed
• 10/13/2006

• Filed Under Seal
• No

• FCPA Statutory Provision
• • Anti-Bribery
  • Books-and-Records
  • Internal Controls

• Other Statutory Provision
• None

• Disposition
• Cease-and-Desist Order

• Defendant Jurisdictional Basis
• Issuer

• Defendant's Citizenship
• Norway