United States v. Tidewater Marine International, Inc. (S.D. Tex. 2010)

• Case Name
• United States v. Tidewater Marine International, Inc. (S.D. Tex. 2010)

• Date Filed
• 11/04/2010

• Enforcement Agency
• DOJ

• Countries
• Azerbaijan, Nigeria

• Foreign Official
• Officials of the Ministry of Taxes for the Republic of Azerbaijan; Nigerian Customs Service officials.

• Date of Conduct
• 2001 to 2007

• Nature of Business
• Tidewater Marine International, Inc. (“TMII”) is incorporated in the Republic of Panama and is a wholly-owned subsidiary of Tidewater, Inc. (“Tidewater”), a Delaware corporation.  Tidewater owns and operates offshore service and supply vessels that are chartered by energy exploration, development, and production companies.  TMII provided managerial and administrative oversight for most of Tidewater’s international operations.

• Influence to be Obtained
• In 2001, 2003, and 2005, TMII, through its employees and agents, paid bribes amounting to approximately $160,000 to tax inspectors in Azerbaijan.  The benefit received and the potential tax liability avoided as a result of those payments was approximately $820,000.
   
  From 2002 to 2007, TMII was aware of and authorized $1.6 million worth of payments made by its Nigerian subsidiary to its freight-forwarding agent, Panalpina World Transport (Holding) Ltd. (“Panalpina”).  These payments were reimbursements for bribes paid by Panalpina, on behalf of TMII, to Nigerian customs officials.  The bribes were paid to induce the officials to disregard Nigerian regulations, to not impose fines and penalties, and to allow Tidewater vessels to operate in Nigerian waters without valid permits.  The benefits TMII received in exchange for these payments totaled approximately $5.8 million. 
   

• Enforcement
• On November 4, 2010, the DOJ and TMII entered into a three-year deferred prosecution agreement, under which TMII agreed to pay a penalty of $7.35 million, review and revise its existing internal controls, policies, and procedures as necessary, and provide a yearly report to the DOJ on the remediation and implementation of its compliance program and internal controls, policies, and procedures.
   
  On the same day, Tidewater, Panalpina, and two of Panalpina’s other customers in the oil exploration and production industry also pleaded guilty to and settled related charges with the DOJ and SEC.
   

• Amount of the Value
• Approximately $1.76 million.

• Amount of Business Related to Payment
• Approximately $1.76 million.

• Intermediary
• Freight Forwarder; Agent.

• Total Sanction
• $ 7,350,000

• Compliance Monitor
• No

• Reporting Requirements
• No

• Case is Pending?
• No

• Total Combined Monetary Sanction
• $ 15,650,000

• Related Enforcement Actions
• SEC v. Tidewater Inc. (E.D. La. 2010)
  

Tidewater Marine International

• Citation
• United States v. Tidewater Marine Int’l, Inc., No. 4:10:cr-770 (S.D. Tex. 2010).

• Date Filed
• 11/04/2010

• Filed Under Seal
• No

• FCPA Statutory Provision
• • Aiding and Abetting: Books-and-Records
  • Conspiracy: Anti-Bribery
  • Conspiracy: Books-and-Records

• Other Statutory Provision
• None

• Disposition
• Deferred Prosecution Agreement

• Defendant Jurisdictional Basis
• Domestic Concern

• Defendant's Citizenship
• United States