He was sentenced for conspiring to violate the Foreign Corrupt Practices Act (FCPA) by participating in a decade-long scheme to bribe Nigerian government officials to obtain engineering, procurement and construction (EPC) contracts. He was also sentenced for conspiring to commit mail and wire fraud as part of a separate kickback scheme.
US district judge Keith Ellison for the Southern District of Texas also ordered Stanley to serve three years of supervised release following the prison term and to pay US$10.8 million in restitution to KBR, the victim of the separate kickback scheme. Stanley, 69, pleaded guilty on 3 September 2008 to a two-count criminal information charging him with one count of conspiracy to violate the FCPA and one count of conspiracy to commit mail and wire fraud.
Two of Stanley’s co-conspirators also were sentenced. Jeffrey Tesler, 63, a United Kingdom citizen and licensed solicitor, was sentenced to 21 months in prison, followed by two years of supervised release. Tesler also was ordered to pay a US$25,000 fine and previously was ordered to forfeit US$148,964,568. Wojciech Chodan, 74, a UK citizen and former salesman at KBR’s UK subsidiary, was sentenced to one year of probation and ordered to pay a US$20,000 fine. Chodan previously was ordered to forfeit US$726,885.
Tesler and Chodan were indicted on 17 February 2009, and subsequently extradited to the USA from the UK. On 6 December 2011, Chodan pleaded guilty to count one of the indictment charging him with conspiring to violate the FCPA. On 11 March 2011, Tesler pleaded guilty to one count of conspiracy to violate the FCPA and one count of violating the FCPA.
All three defendants fully cooperated with the Justice Department’s investigation, which resulted in more than US$1.7 billion in penalties, disgorgement and forfeitures. The defendants’ assistance in the investigation and prosecution of other defendants was reflected in the sentences the court imposed.
"Today’s prison sentences for Mr Stanley and Mr Tesler mark another important step in our prosecution of those responsible for a massive bribery scheme involving engineering, procurement and construction contracts in Nigeria,” said Mythili Raman, principal deputy assistant attorney general for the criminal division. “These sentences reflect not only the defendants’ illegal acts, but also their substantial cooperation with the government. As a result of this investigation, three individuals have been convicted of FCPA-related crimes, and five companies in four countries have paid substantial penalties and undertaken significant efforts to enhance their compliance programmes. This case shows the importance the department places on putting an end to foreign bribery.”
According to court documents, KBR was a member of the TSKJ joint venture (named for the first letters of the names of the companies involved), along with Technip., Snamprogetti Netherlands, and JGC Corporation. Between 1995 and 2004, TSKJ was awarded four EPC contracts, valued at more than US$6 billion, by Nigeria Liquefied Natural Gas (LNG) to build the LNG facilities on Bonny Island. The government-owned Nigerian National Petroleum Corporation was the largest shareholder of NLNG, owning 49 percent of the company.
From approximately 1994 through June 2004, the joint venture companies, Stanley, Tesler, Chodan and others agreed to pay bribes to a wide range of Nigerian government officials in order to obtain and retain the EPC contracts. To pay the bribes, the joint venture hired two agents – Tesler and Marubeni Corporation, a Japanese trading company headquartered in Tokyo. The joint venture hired Tesler as a consultant to pay bribes to high-level Nigerian government officials, including top-level executive branch officials, and hired Marubeni to pay bribes to lower-level Nigerian government officials. At crucial junctures preceding the award of the EPC contracts, Stanley and other co-conspirators met with successive holders of a top-level office in the executive branch of the Nigerian government to ask the office holders to designate a representative with whom TSKJ should negotiate bribes to Nigerian government officials. TSKJ paid approximately US$132 million to a Gibraltar corporation controlled by Tesler and US$51 million to Marubeni during the course of the bribery scheme for use, in part, to pay bribes to Nigerian government officials.
In a related criminal case, KBR’s successor company, Kellogg Brown & Root LLC, pleaded guilty in February 2009 to FCPA-related charges for its participation in the scheme to bribe Nigerian government officials. Kellogg Brown & Root LLC was ordered to pay a US$402 million fine and to retain an independent compliance monitor for a three-year period to review the design and implementation of its compliance programme.
In another related criminal case, the department filed a deferred prosecution agreement and criminal information against Technip in June 2010. According to that agreement, Technip agreed to pay a US$240 million criminal penalty and to retain an independent compliance monitor for two years. In July 2010, the department filed a deferred prosecution agreement and criminal information against Snamprogetti, which also agreed to pay a US$240 million criminal penalty. In April 2011, the department filed a deferred prosecution agreement and criminal information against JGC, in which JGC agreed to pay a US$218.8 million criminal penalty and to retain an independent compliance consultant for two years. In January 2012, the department filed a deferred prosecution agreement and criminal information against Marubeni, in which Marubeni agreed to pay a US$54.6 million criminal penalty and to retain a corporate compliance consultant for two years.
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