A&O Shearman FCPA Digest | SEC v. GlobalSantaFe Corp. (D.D.C. 2010)

Source Documents

Foreign Official
Nigerian Customs Service (“NCS”) officials and unspecified Gabon, Angolan, and Equatorial Guinean government officials.

Nature of Business
Offshore oil and gas drilling services for oil and gas exploration companies incorporated in the Cayman Islands and headquartered in Texas. GlobalSantaFe Corp.’s (“GSF”) direct subsidiary, Global Offshore Drilling Ltd., operated in West Africa. In November 2007, GSF merged with a subsidiary of Transocean Inc. In December 2008, the listed company became Transocean Ltd.

Influence to be Obtained
Between January 2002 and July 2007, GSF allegedly, through its customs brokers, made illegal payments to NCS officials to obtain preferential treatment during the customs process for the purpose of assisting GSF in retaining business in Nigeria. Instead of moving its oil drilling rigs out of Nigerian waters as required by Nigerian law when GSF’s permit to temporarily import the rigs into Nigeria expired, GSF’s customs brokers allegedly made payments to obtain documentation reflecting that the rigs had moved out of Nigerian waters, when in fact, the rigs had not moved at all. In addition, GSF allegedly made a number of suspicious payments to government officials in Gabon, Angola, and Equatorial Guinea. These payments were described on invoices as, for example, “customs vacation,” “customs escort,” “costs extra police to obtain visa,” “official dues,” and “authorities fees.” According to the SEC, these payments were not accurately reflected in GSF’s books and records, nor was GSF’s system of internal accounting controls adequate at the time to detect and prevent these illegal payments.

Enforcement
On October 22, 2010, GSF consented to the entry of a court order permanently enjoining it from violating the anti‑bribery and record keeping and internal controls provisions of the FCPA. Without admitting or denying the SEC’s allegations, GSF also consented to the entry of a court order requiring GSF disgorge profits of $2,694,405 plus prejudgment interest of $1,063,760, and pay a civil penalty of $2.1 million.