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When can Oil and Gas Companies Get in Trouble?

When they not only violate the Foreign Corrupt Practices Act, FCPA, but also do so for the express purpose of doing business in Iran. Apparently not even the French like anyone bribing Iranian officials to get oil. They joined with the United States to prosecute a French Company Called Total and voila $400 million to settle the claims according to Megan R. Wilson in The Hill newspaper.

Ah yes, the Foreign Corrupt Practices Act. We are not supposed to be running off and bribing foreigners to get business elsewhere in the world. Does it happen? Do companies get away with it? Can you spare a little sympathy for major multi-national companies who have to compete with everybody else but are not supposed to bribe officials in countries, where let’s face it bribery happens? Yes, Yes, and ok maybe just for a second but Iran?

I mean these guys were doing business in Iran. Iran does have oil for sale and so you can see where the temptation would arise. But Iran? They didn’t think anybody was watching who was making money on Iranian oil?
Well maybe, Total could be forgiven for thinking nobody was watching because the article says they paid $60 million in bribes over ten years before they got caught.
However, somebody was watching after all. The S.E.C. could file suit, because while Total is a French company they are traded on the New York Exchange, the DOJ prosecuted and the French joined the action and are prosecuting French officials of the company.
A tri-color tri-fecta.
Just in case you were wondering, the article made no mention of whistleblowers finding out about this case. Maybe they did and maybe the people whose job it is to pay attention to Iran found out about this one. It’s your guess.

Still, with this kind of money being collected by an S.E.C. action we pause to remind you that a whistleblower with information about a firm committing violations of the Foreign Corrupt Practices Act could file a case under the S.E.C. qui tam provisions. That law provides incentives and if the fines are as large as in this case the reward could be huge. In fact, if the company was doing business using U.S. government money abroad that would also be a traditional False Claims Act case.

Now that we seem to have the S.E.C.’s attention maybe there will be more cases as soon as whistleblowers realize there is a way to cash in on any knowledge of a firm illegally bribing government officials abroad.

Maybe it’s a trend to use the Foreign Corrupt Practices Act when business tries to bribe political rivals or enemies of the United States? Anyway this latest case seems pretty clear, if the article in the Hill is right. The story says Total paid $60 Million in bribes and made $150 Million in profit doing business with Iran.
Even if you are a flat earth free marketer in the extreme and think that a French Company who raises money on our stock exchange, should not be subject to S.E.C. regulation and the FCPA, weep not for Total the company that got caught. The Hill report makes clear they can afford this settlement, “Total S.A. brought in more than $236 billion, or more than 182 billion euros, in revenue during 2012.”