Reuters: Regulatory News: UPDATE 4-Total settles U.S. bribe probe for $398 mln; CEO may be tried

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UPDATE 4-Total settles U.S. bribe probe for $398 mln; CEO may be tried May 29th 2013, 21:37 Wed May 29, 2013 5:37pm EDT * Total said to bribe Iranian official to win contracts * French prosecutor eyes case against Total, CEO de Margerie * Total says would at trial demonstrate actions were legal By Muriel Boselli and Jonathan Stempel PARIS/NEW YORK, May 29 (Reuters) - Total SA agreed to pay $398.2 million to settle U.S. criminal and civil allegations that it paid bribes to win oil and gas contracts in Iran, and a French prosecutor has recommended that the company and its chief executive be brought to trial in its home country. France's largest oil producer on Wednesday agreed with the U.S. Department of Justice to enter a deferred prosecution agreement and pay a $245.2 million fine to resolve three charges that it violated the Foreign Corrupt Practices Act. Total will also give up $153 million of illegal profit in a related civil settlement with the U.S. Securities and Exchange Commission. The criminal penalty is the fourth-largest under the FCPA, an anti-bribery law, Justice Department spokesman Peter Carr said. U.S. authorities said that between 1995 and 2004, Total paid about $60 million in bribes to induce an Iranian government official to help the company obtain lucrative development rights in three oil and gas fields. The U.S. criminal case will be dropped after three years if Total complies with the deferred prosecution agreement, which calls for it to retain an independent compliance monitor. But the affair is not over, as a French prosecutor said Total and its Chief Executive Christophe de Margerie should face trial for allegedly corrupting foreign public officials over contracts with Iran in the 1990s and early 2000s. The prosecutor also said de Margerie should face trial for misuse of company funds. A Total spokesman confirmed that the company had been notified of the Paris prosecutor's recommendation and said the company and de Margerie would demonstrate in any trial that their behavior had been legal. U.S. authorities said Total has American depositary shares that trade on the New York Stock Exchange, and qualifies as an "issuer" that could face sanctions under the FCPA. COORDINATED ACTION According to papers filed with a federal court in Alexandria, Virginia, Total funneled the illegal payments mainly to Swiss bank accounts designated by two unnamed intermediaries who acted at the behest of the Iranian official. One intermediary worked at a Swiss private bank, and the other was a company in the British Virgin Islands, the court papers show. "We announce the first coordinated action by French and U.S. law enforcement in a major foreign bribery case," Acting U.S. Assistant Attorney General Mythili Raman said in a statement. "Our two countries are working more closely today than ever before to combat corporate corruption, and Total, which bought business through bribes, now faces the criminal consequences across two continents," Raman added. Carr said the largest criminal penalty imposed under the FCPA is the $450 million that German engineering company Siemens AG agreed to pay in 2008, as part of an overall $800 million settlement with U.S. authorities. Total had flagged a possible settlement in an SEC filing last year when it took a 316 million euro ($409 million) charge against its accounts, a relatively small sum for a company that makes billions of dollars in profit every quarter. Talks between U.S. authorities and Total, Western Europe's third-largest oil company, had begun in 2010. A French investigating magistrate will decide whether a trial is to be held for the outspoken, mustachioed 61-year-old de Margerie, whose mandate as chief executive is scheduled to expire in 2015. Total's chief is a well-known figure in international oil circles who was in charge of the company's Middle East division at the time the alleged wrongdoing began. He and the company have been under investigation in France since 2006. Shares in Total closed down 1.7 percent at 39.40 euros. The cases are U.S. v. Total SA, U.S. District Court, Eastern District of Virginia, No. 13-00239; and In re: Total SA, SEC Administrative Proceeding No. 3-15338. Link this Share this Digg this Email Reprints

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