WASHINGTON (CN) - Chemical company Innospec agreed to pay $40.2 million to settle SEC charges that it bribed Iraqi and Indonesian officials in order to win lucrative contracts for its fuel additive, tetraethyl lead.
Without admitting or denying the allegations, the company agreed to a $40.2 million global settlement and to submit to an independent monitor for three years.
In a federal lawsuit, the SEC says Innospec paid more than $9.2 million in illegal bribes to state-owned refineries and oil companies in Iraq and Indonesia from 2000 to 2007. Innospec also paid kickbacks to Iraqi officials to obtain contracts under the United Nations Oil for Food Program, the agency says.
Innospec paid Iraqi ministries and government officials $6.3 million, and promised an additional $2.8 million to Indonesian government officials, in exchange for approximately $176 million in contracts for its fuel additive, investigators claim.
Innospec allegedly paid lavish travel and entertainment expenses for Iraqi Ministry of Oil officials, including the seven-day honeymoon of one official. Innospec supplied mobile phone cards and cameras, and paid thousands of dollars in cash to officials for "pocket money," the SEC says.
"Innospec's long-standing practice of bribing government officials was particularly egregious given the role of management, which authorized and condoned the misconduct," said Cheryl J. Scarboro, chief of the SEC's Foreign Corrupt Practices Act Unit.