Singapore’s state-backed corporate heavyweights – collectively known as “Singapore Inc” – will face tough questions in 2018 on their commitment to the Lion City’s vaunted anti-corruption ethos, observers say, as a shocked public comes to grips with a graft scandal that has engulfed oil rig builder Keppel Corp.
One political observer went as far as to describe 2017 as “annus horribilis” for the city state’s corporate sector. That sentiment echoed the hand-wringing among government critics that followed last week’s announcement by US prosecutors that Keppel’s offshore and marine arm, Keppel O&M, agreed to pay a US$422 million settlement to avoid a criminal trial for bribing Brazilian officials.
Keppel O&M, according to court documents released by the US justice department, engaged in a scheme between 2001 and 2014 to pay US$55 million in bribes to win 13 contracts with Petrobas and Sete Brasil – two Brazilian oil companies deeply mired in the country’s wide-ranging Operation Car Wash graft scandal. Keppel O&M is the world’s biggest builder of oil rigs.
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Singapore arrests former Keppel executives in Brazil bribery probe
Several former executives of Keppel Corp have been arrested by Singaporean authorities in a probe related to charges its rig-building unit bribed Brazilian officials, Singapore’s Straits Times newspaper reported on Friday.
Keppel Offshore & Marine in December agreed to pay $422 million to resolve investigations into the matter by authorities in the United States, Brazil and Singapore.
But Singapore’s Attorney-General’s Chambers (AGC) and the Corrupt Practices Investigation Bureau (CPIB) said at the time that investigations regarding the individuals involved were ongoing.
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Pritam Singh asked Indranee Rajah many questions about Keppel’s corruption case
Workers’ Party MP Pritam Singh earlier filed a number of parliamentary questions on the Keppel Offshore & Marine Ltd. (KOM) corruption case for the Jan. 8 sitting of Parliament.
Senior Minister of State for Law and Finance Indranee Rajah responded to the questions. But Pritam subsequently raised additional supplementary questions which elicited further responses from Indranee.
Here’s a rundown of the back-and-forth exchange between them:
- Will Temasek Holdings call for an extraordinary general meeting?
- Was the government aware of Keppel board’s conduct?
- What is the KOM subsidiary in Singapore that paid bribes?
- Was former Keppel CEO and former Ambassador to Brazil Choo Chiau Beng involved?
- Why are the individuals involved not identified?
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MARUAH: Consequences of corruption are multi-faceted and impact on all human rights
MARUAH, a local human-rights non-government organisation has issued a statement on the international bribery scandal which involved Singapore government-linked company, Keppel Offshore & Marine Ltd (KOM).
The NGO writes that it is "deeply disturbed at the blatant corruption of KOM, disregarding its own history, Singapore’s long-held stance against corruption" and "Keppel’s own ineptitude as a company to maintain a business and human rights role model practice, as a government-linked multi-national company".
It further states that it is bewildered with the Attorney-General’s Chambers (AGC)'s decision to only issue a conditional warning to KOM and asks what then entails local prosecution when a Singapore-based or Singapore-owned company bribes in other countries, to gain business opportunities.
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Inside the Keppel Corporation Corruption Scandal
On Aug 3, 2016, a news wire report alleged that Keppel Corporation was involved in a bribery scandal in Brazil. However, the company strongly refuted those allegations and this denial was also widely reported in the news media.
Keppel Corp even made a regulatory filing to the Singapore Exchange (SGX) on that Wednesday Aug 3 evening in response to the news wire report. In its filing, it said: “Keppel strongly denies the allegations reportedly made that Keppel executives authorised Mr Skornicki to pay bribes on its behalf.”
Even earlier than that in 2015, Keppel Corp’s name cropped up in reports on the “Operation Car Wash” probe, when investigations uncovered a claim that executives from Brazil’s state-owned oil company Petrobras took bribes in exchange for awarding contracts. To my knowledge, Keppel Corp did not make any public statements denying or admitting those allegations.
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Keppel O&M sanctioned 17 current, former employees over Brazil bribery case: document
Singapore authorities are investigating individuals involved
Keppel Corp’s rig-building unit has taken disciplinary action against 17 current and former employees as part of its Brazil bribery case, a U.S. court document showed, including $8.9 million of financial sanctions, demotions and departures.
The measures were revealed after the Singapore-based company agreed to pay $422 million to settle charges it bribed Brazilian officials, including some at state-run oil company Petrobras.
In the document seen by Reuters, U.S. authorities listed remedial measures taken by Keppel Offshore & Marine as part of ‘relevant considerations’ toward the deferred prosecution agreement the firm signed as part of the settlement.
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Keppel O&M imposes US$8.9m financial sanctions on 12 former and current employees
KEPPEL Offshore & Marine has imposed (see amendment note) US$8.9 million in financial sanctions on 12 former or current employees as part of its disciplinary actions arising from the company's Brazil bribery case.
According to the plea agreement signed by Keppel Offshore & Marine USA Inc (KOM), its parent company Keppel O&M Ltd has acted against 17 former or current employees pertaining to the misconduct.
Demotions and/or written warnings were issued as agreed to seven employees who failed to detect the misconduct and/or failed to take appropriate steps to mitigate corruption and compliance risks. Seven employees involved in the misconduct have left the company.
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*Ex-Keppel lawyer cooperated with US in bribery probe
A former lawyer at Keppel Corp's oil rig building business secretly pleaded guilty and cooperated with US authorities before the Singapore-based company agreed to pay US$422 million (S$566 million) to settle charges that it bribed Brazilian officials, according to court documents.
Jeffery Chow, a former senior member of Keppel Offshore & Marine's legal department, cut a deal to help prosecutors in their probe of Keppel and other former executives, according to the documents unsealed on Tuesday in federal court in Brooklyn. Chow, 59, pleaded guilty on Aug 29 to conspiring to violate the Foreign Corrupt Practices Act as part of his deal to cooperate. He admitted to drafting contracts that were used to make bribe payments, according to court records
Keppel has taken disciplinary action against the employees involved in its rig-building unit's bribery scandal in Brazil, including the meting out of financial penalties. The group has also "separated" with all the executives defined as "relevant individuals" in the statement of facts released earlier by the authorities behind the graft probe.
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At least six former employees of Keppel O&M involved in Brazil corruption scandal
It has been reported that a US court document shows that at least six former employees of Keppel Offshore & Marine (Keppel O&M) have been implicated in a Brazilian graft scandal, including some from the firm's United States and Brazil operations.
The court document states that between 2001 and 2011, Keppel O&M and Keppel O&M US executives created and executed agreements on behalf of the company with consulting firms controlled by a consultant.
The document did not mention the name of the consultant, however, it is believed to be Mr Zwi Skornicki, a former agent of Keppel in Brazil and the man central to the unfolding of the scandal.
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Keppel acts against staff in bribery scandal
Keppel has taken disciplinary action against employees involved in its rig-building unit's bribery scandal in Brazil, including meting out financial penalties.
It has also "separated" with all the executives defined as "relevant individuals" in the statement of facts that was released earlier by the authorities behind the graft probe.
A Keppel Offshore & Marine (Keppel O&M) spokesman confirmed this yesterday, although he did not disclose more on the financial penalties, or when the company separated from the individuals.
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Keppel O&M to Pay $422 Million to Settle Bribery Probe
Singaporean shipyard firm Keppel Offshore & Marine Ltd. agreed to pay $422 million to resolve a foreign bribery investigation involving authorities on three continents.
The company, a unit of conglomerate Keppel Corp., entered into a deferred prosecution agreement with U.S. authorities charging the firm with conspiracy to violate the Foreign Corrupt Practices Act, which bars the use of bribes to foreign officials to get or keep business. It also reached related settlements with Brazilian and Singaporean authorities,
“Keppel admitted in court documents that it paid about $55 million in bribes to officials at Brazilian state-owned oil company Petróleo Brasileiro and the then-governing party in Brazil from 2001 to 2014 to win 13 contracts with Petrobras, as the company is also known, and another company. It paid the bribes through outsize commissions to an intermediary, who in turn made payments to the officials and the political party, prosecutors said.”
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Singapore shipyard to pay $422m in bribery case
Singapore-based shipyard operator Keppel Offshore & Marine Ltd. (KOM) and its U.S. subsidiary, Keppel Offshore & Marine USA, have agreed to pay a penalty of more than $422 million to resolve U.S. charges that it paid millions of dollars in illegal bribes to Brazilian industry and government officials, according to a statement from the U.S. Department of Justice.
Similar investigations were carried out against KOM by regulatory authorities in Singapore and Brazil, the Justice Department said. According to investigators, from 2001 to 2014, KOM conspired to violate the U.S. Foreign Corrupt Practices Act (FCPA) by paying about $55 million in bribes to officials at the Brazilian state-owned oil company Petrobras and to Brazil’s then-governing party in order to win 13 contracts with Petrobras and another Brazilian entity.
“In an attempt to conceal their crimes, the defendants used the global financial system – including the United States banking system – to disguise the source and disbursement of the bribe payments by passing funds through a series of shell companies,” Acting U.S. Attorney Bridget M. Rohde said in a statement.
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A Shocking Window Into The Institutional Corruption That Pervades Singapore Inc
Quietly over Christmas the US Justice Department announced that it had reached a deferred prosecution agreement with Keppel Offshore and Marine. Under the agreement Keppel O & M, a unit of Keppel Corp, will pay $422 million to resolve charges that it paid $55 million in bribes to Brazilian politicians to win business from the state oil company Petrobras, an offence under the US Foreign Corrupt Practices Act.
According to the WSJ, “Keppel admitted in court documents that it paid about $55 million in bribes to officials at Brazilian state-owned oil company Petróleo Brasileiro and the then-governing party in Brazil from 2001 to 2014 to win 13 contracts with Petrobras, as the company is also known, and another company. It paid the bribes through outsize commissions to an intermediary, who in turn made payments to the officials and the political party, prosecutors said.”
The bribes were disguised by being channelled through a series of bank accounts in he names of shell companies controlled by Keppel’s Brazilian agent, Zwi Skornicki. Shockingly, despite allegations by Skornicki that five leading executives at Keppel had authorised him to make the payments, the only individual who is being prosecuted is a former senior member of the Keppel legal department. All we are told is that he has pleaded guilty and will presumably face a long US jail sentence.
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Workers' Party MPs file parliamentary questions on Keppel O&M corruption case
The Workers' Party (WP) has filed parliamentary questions seeking to find out more about the massive corruption case involving Keppel Offshore & Marine (Keppel O&M).
On Friday (Dec 29), the party's assistant secretary-general Pritam Singh wrote on Facebook that he, as well as fellow MPs Sylvia Lim & Png Eng Huat, had collectively filed 4 questions relating to the incident.
Last Saturday, it was reported that Keppel O&M paid US$422 million (S$567 million) in fines as part of a global resolution reached with criminal authorities in the United States, Brazil and Singapore over corrupt payments made by a former agent in Brazil. It was also issued a conditional warning by Singapore's Corrupt Practices Investigation Bureau (CPIB), the conglomerate said in its news release then.
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Pritam Singh on Thursday
Keppel O&M Corruption Scandal
The last day to file Parliamentary Questions for the 8 Jan 2018 sitting of Parliament was 26 December 2017 at 4.30pm. Amidst the shocking revelation of what must be one of the largest corruption scandals in the history of Singapore's Government Linked Companies, I was most surprised to see the virtual absence of any substantive information on this scandal on the AGC or CPIB websites except a brief media statement on the conditional warning given to Keppel, something made even more curious in view of Keppel's denial over a year ago that its top executives were even involved in giving out bribes for contracts. The US Department of Justice website has helpfully uploaded some useful documents in the public interest that flesh out this corruption saga in greater detail here: https://www.justice.gov/…/keppel-offshore-marine-ltd-and-us
The WP MPs have filed the following questions on this matter for the upcoming Parliamentary session but we will have to wait and see if these questions are prioritised amongst the first 15 or so for oral answer, failing which they will have to be deferred for the next sitting or set down for a written answer. This corruption scandal invites many other angles to consider too, so I was rather surprised to see no question on the matter filed by any PAP MP, suggesting that a Ministerial Statement may well be made. But then again, the Speaker has the power to allow questions to be admitted after 26 Dec 2017, if he determines to allow so.
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Keppel Offshore to Pay $422 Million to End Bribery Probe
Keppel Offshore & Marine Ltd, the world’s biggest builder of oil rigs, agreed to pay $422 million to end a U.S. bribery probe into illegal payments to officials at Petroleo Brasileiro SA, Brazil’s state-owned oil company, and to the then-governing political party.
Keppel units paid about $55 million to win 13 contracts with Petrobras and another company, U.S. prosecutors said in a press release after an American subsidiary pleaded guilty in federal court in Brooklyn, New York. The payments were part of outsize commissions to an intermediary and disguised as consulting agreements, according to prosecutors.
“The defendants used the global financial system –- including the United States banking system –- to disguise the source and disbursement of the bribe payments by passing funds through a series of shell companies," Bridget Rohde, acting U.S. Attorney in Brooklyn, said in a statement.
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Keppel Offshore & Marine Ltd. and U.S. Based Subsidiary Agree to Pay $422 Million in Global Penalties to Resolve Foreign Bribery Case
Keppel Offshore & Marine Ltd. (KOM), a Singapore-based company that operates shipyards and repairs and upgrades shipping vessels, and its wholly owned U.S. subsidiary, Keppel Offshore & Marine USA Inc. (KOM USA), have agreed to pay a combined total penalty of more than $422 million to resolve charges with authorities in the United States, Brazil and Singapore arising out of a decade-long scheme to pay millions of dollars in bribes to officials in Brazil. KOM USA pleaded guilty today in connection with the resolution. In addition, a guilty plea by a former senior member of KOM’s legal department was unsealed.
Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, Acting U.S. Attorney Bridget M. Rohde of the Eastern District of New York, and Assistant Director Stephen E. Richardson of the FBI’s Criminal Investigative Division made the announcement.
“Today’s resolution once again underscores the importance of the Department of Justice’s collaboration with foreign authorities to hold corrupt companies and individuals accountable for their crimes, while ensuring the fair and appropriate allocation of fines and penalties,” said Acting Assistant Attorney General Cronan. “This case also represents the first coordinated FCPA resolution with Singapore and the most recent of several coordinated resolutions with Brazil. The Criminal Division is committed to working with our international partners to ensure that honest, law abiding companies are able to compete on a level playing field across the globe.”
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Keppel Corp bribe tarnishes Singapore’s squeaky-clean image says Hong Kong paper
Keppel Corp’s bribe tarnishes Singapore’s squeaky-clean image says Hong Kong paperThe South China Morning Post or SCMP made the Keppel Corp scandal its main, breaking story today saying “Singapore Inc” will have to face tough questions in 2018 on their commitment to the Lion City’s vaunted anti-corruption ethos.
It cited several issues that have already raised worries over whether the Lion City was slipping in its intolerance for graft, saying the country’s squeaky-clean image is under fire.
“The country’s squeaky-clean image, buttressed by its high rankings in international anti-corruption indices, had already taken a beating when Prime Minister Lee Hsien Loong in July was forced to emphatically refute allegations of nepotism and abuse of power levelled by his own siblings,” wrote SCMP.
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Did Keppel management lie to the public?
In the Brazilian bribery case involving Keppel Offshore & Marine, some US$55 million (SGD$73.5 million) were reported to have been paid by a Keppel agent to Brazilian govt officials in order to secure deals for Keppel in Brazil. These "improper payments" were made over a period from 2001 to 2014, and they were carried out with the knowledge or approval of former Keppel senior executives.
Bloomberg broke the news last year on 3 August, reporting on how the Brazilian agent, Zwi Skornicki, testified in a Brazilian court naming five of the Keppel senior executives, which include then Keppel Offshore & Marine CEO Chow Yew Yuen, who had authorized him to bribe the officials.
Keppel's management at first denies bribery involvement. When Bloomberg broke the news, Keppel's management immediately responded on the same day, denying its involvement in the bribery case.
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Will the Government prosecute the 5 former Keppel senior executives named in Brazilian court?
It has been reported that in the Keppel bribery case, some US$55 million in corrupt payments were made by a former Keppel agent to some Brazilian govt officials in order to secure deals for Keppel in Brazil.
The Brazilian agent made “improper payments” to those officials for more than 10 years between 2001 and 2014, and these were carried out with the knowledge or approval of former Keppel senior executives.
According to a Bloomberg report in Aug last year, the agent, Zwi Skornicki, had testified in a Brazilian court that 5 senior executives of Keppel, including then CEO of Keppel Offshore & Marine, Chow Yew Yuen, did authorize him to bribe the Brazilian Govt officials.
related: Did Keppel management lie to the public?
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Oil Rig Giant’s Man in Brazil Says Managers Backed Bribes
The world’s largest builder of offshore oil rigs has seen investments plummet in one of its most important markets. A major client, Sete Brasil Participacoes, has entered bankruptcy protection. Then last month a former agent fanned the flames of an ongoing corruption investigation by saying in court that the Singapore-based company’s top managers authorized him to pay bribes to win work with state-controlled Petroleo Brasileiro SA.
Shares of Keppel fell 1.1 percent to S$5.20 at the Singapore close, the lowest since May 16.
Zwi Skornicki, the former third-party commercial representative for Keppel in Brazil, told a judge that five leading executives, including current Keppel Offshore & Marine Ltd. Chief Executive Officer Chow Yew Yuen, authorized him to bribe public officials in exchange for Petrobras contracts that often exceeded a billion dollars. Keppel denied the allegations and says none of the executives, including CEO Chow, ever authorized Skornicki to pay bribes, the company said Wednesday in an e-mailed statement.
The other Keppel executives who allegedly knew about and authorized the kickbacks are Tong Chong Heong, a former senior executive at Keppel Corp.; Tay Kim Hock, a former CEO of Keppel Fels Brasil; Tay Kim Hock, the current CEO at Keppel Fels Brasil; and Choo Chiau Beng, a former Keppel Corp. CEO, according to Skornicki’s testimony given on July 21 to judge Sergio Moro, who heads the so-called Carwash investigation. The testimony was published on a court website as part of the court record.
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Keppel denies claims its top execs backed bribes in Brazil
Singapore-based offshore oil rig builder Keppel on Wed (Aug 3) refuted allegations that its top executives authorised the company's former agent in Brazil to pay bribes on its behalf.
Earlier the same day, Bloomberg reported allegations made by Mr Zwi Skornicki in criminal proceedings brought against him in Brazil. Mr Skornicki was cited as saying in court that 5 top Keppel managers, including current Keppel Offshore and Marine Chief Executive Officer Chow Yew Yuen, authorised him to bribe public officials to win contracts with state-controlled Petrobras, many of which were worth more than a billion dollars.
Keppel said in a media statement: "Keppel strongly denies the allegations reportedly made that Keppel executives authorised Mr Skornicki to pay bribes on its behalf. None of the individuals named in the article, including the current CEO of Keppel Offshore & Marine Mr Chow Yew Yuen, have ever authorised Mr Skornicki to make any payments as bribes."
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Singapore’s government embroiled in domestic crisis management
2017 was a horrible year for Singapore’s government — and for Prime Minister Lee Hsien Loong in particular.
It began with an open and vocal stoush with China. Late in 2016 the Chinese government confiscated millions of dollars’ worth of Singapore’s military hardware passing through the port of Hong Kong. The action was in part retaliation for Lee’s vocal endorsement of the US position on China’s militarisation of the South China Sea.
China released Singapore’s military hardware in late January, but then sent a new message of displeasure — Singapore was not welcome at Xi Jinping’s Belt and Road Forum in May 2017. While Lee did not attend the Forum, he later led high-level delegations to both Beijing and Washington, successfully recovering much lost ground.
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Full Coverage:
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Keppel O&M sanctioned 17 current, former employees over Brazil bribery case
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