tenaris to pay us$ 5.4 million in sec first ever deferred prosecution agreement
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Tenaris to Pay $5.4 Million in SEC's First-Ever Deferred Prosecution Agreement
http://www.sec.gov/news/press/2011/2011-112.htm[28-12-2011 20:02:14]
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Tenaris to Pay $5.4 Million in SEC's First-Ever DeferredProsecution Agreement
FOR IMMEDIATE RELEASE2011-112
Washington, D.C., May 17, 2011 – The Securities and ExchangeCommission today entered into a Deferred Prosecution Agreement (DPA)with Tenaris S.A. in its first-ever use of the approach to facilitate andreward cooperation in SEC investigations.
Additional MaterialsDeferred Prosecution Agreement
The agreement with Tenaris involves allegations that the globalmanufacturer of steel pipe products violated the Foreign Corrupt PracticesAct (FCPA) by bribing Uzbekistan government officials during a biddingprocess to supply pipelines for transporting oil and natural gas. The SECalleges that Tenaris made almost $5 million in profits when it wassubsequently awarded several contracts by the Uzbekistan government.Under the terms of the DPA, Tenaris must pay $5.4 million in disgorgementand prejudgment interest.
Tenaris is the first company to enter into a DPA with the SEC, an approachannounced last year to encourage individuals and companies to provideinformation about misconduct and assist with an SEC investigation. WhenTenaris conducted a thorough, worldwide internal review of its operationsand controls, it discovered FCPA violations by personnel in Uzbekistan andinformed the SEC. In response to its findings, Tenaris reviewed its controlsand compliance measures and significantly enhanced its anti-corruptionpolicies and practices. Tenaris has agreed to cooperate further with the SEC,Justice Department, and any other law enforcement agency in connectionwith this case. Tenaris also agreed to pay a $3.5 million criminal penalty ina Non-Prosecution Agreement announced today by the Justice Department.
“The Tenaris foreign bribery scheme was unacceptable and unlawful, but thecompany’s response demonstrated high levels of corporate accountabilityand cooperation,” said Robert Khuzami, Director of the SEC’s Division ofEnforcement. “The company’s immediate self-reporting, thorough internalinvestigation, full cooperation with SEC staff, enhanced anti-corruptionprocedures, and enhanced training made it an appropriate candidate for theEnforcement Division’s first Deferred Prosecution Agreement. Effectiveenforcement of the securities laws includes acknowledging and providingcredit to those who fully and completely support our investigations and whodisplay an exemplary commitment to compliance, cooperation, andremediation.”?
Cheryl Scarboro, Chief of the SEC Enforcement Division’s FCPA Unit, added,“Tenaris’s conduct was clearly in violation of the FCPA. The company’semployees bribed government officials in Uzbekistan to obtain governmentcontracts. But when Tenaris discovered the illegal conduct, it tooknoteworthy steps to address the violations and significantly enhance itsanti-corruption policies and practices to remediate weaknesses in its internal
Tenaris to Pay $5.4 Million in SEC's First-Ever Deferred Prosecution Agreement
http://www.sec.gov/news/press/2011/2011-112.htm[28-12-2011 20:02:14]
controls.”
Tenaris is incorporated in Luxembourg and its American Depositary Receipts(TS) are listed on the New York Stock Exchange. According to the DPA, theSEC alleges that Tenaris bid on a series of contracts in 2006 and 2007 andbribed Uzbekistan officials to gain access to confidential bids bycompetitors. Tenaris used the information to revise its own bids, and as aresult was awarded several contracts by the Uzbekistan government.
Under the terms of the DPA, the SEC will refrain from prosecuting thecompany in a civil action for its violations if Tenaris complies with certainundertakings. Among other things, Tenaris has agreed to enhance itspolicies, procedures, and controls to strengthen compliance with the FCPAand anti-corruption practices. Tenaris will implement due diligencerequirements related to the retention and payment of agents, providedetailed training on the FCPA and other anti-corruption laws, requirecertification of compliance with anti-corruption policies, and notify the SECof any complaints, charges, or convictions against Tenaris or its employeesrelated to violations of any anti-bribery or securities laws. Tenaris hasagreed to continue to fully cooperate with the SEC in its investigation.
The SEC’s investigation was conducted by Karen L. Martinez, AssistantDirector of the Salt Lake Regional Office, and William B. McKean of theEnforcement Division’s FCPA Unit. The SEC acknowledges the assistance ofthe Department of Justice’s Fraud Section and the Federal Bureau ofInvestigation in this case. The SEC’s investigation is continuing.
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For more information about this enforcement action, contact:
Cheryl ScarboroChief, SEC Enforcement Division’s FCPA Unit 202-551-4403
For general questions about Deferred Prosecution Agreements, contact:
Robert KhuzamiDirector, SEC Division of Enforcement (202) 551-4894
http://www.sec.gov/news/press/2011/2011-112.htm
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