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Saturday, March 2, 2024 | Back issues
Courthouse News Service Courthouse News Service

Bribery Scheme to Cost Tenaris $9 Million

(CN) - Tenaris S.A. will pay a $3.5 million penalty for bribing Uzbekistan government officials to win pipeline-supply contracts for the transportation of oil and natural gas, federal authorities say. The Luxembourg-based steel pipe manufacturer also agreed to disgorge $5.4 million in the Securities and Exchange Commission's first-ever deferred prosecution agreement.

Tenaris admitted that its employees and agents bribed officials of OJSC O'ztashqineftgaz, an Uzbekistan state-controlled oil and gas production company, and failed to record those payments in its financial records.

These bribes helped Tenaris obtain four public bids, worth about $5 million, in 2006 anjd 2007 to provide oilfield pipe and related services for energy extraction and transportation projects. In exchange for access to competitors' bid information, Tenaris paid its tipster 3.5 percent of the value of four separate contracts. The tipster would then pay all or some of that bribe to the Uzbek energy company - a fact of Tenaris was aware, prosecutors say.

The related settlement with the SEC is the first of its kind, according to the agency.

"When Tenaris conducted a thorough, worldwide internal review of its operations and controls, it discovered [Foreign Corrupt Practices Act] violations by personnel in Uzbekistan and informed the SEC," according to the SEC. "In response to its findings, Tenaris reviewed its controls and compliance measures and significantly enhanced its anti-corruption policies and practices. Tenaris has agreed to cooperate further with the SEC, Justice Department, and any other law enforcement agency in connection with this case."

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