French oil giant Total to pay $398 million to settle U.S. bribery charges with Iran connection


A man fills his car with fuel at a Total SA gas station in Paris. (Antoine Antoniol/Bloomberg News)

The French oil giant Total agreed to pay $398 million to the U.S. government to settle charges that it violated the Foreign Corrupt Practices Act by paying $60 million in bribes in 1995 to intermediaries of an Iranian government official who then used his influence to help the company obtain valuable contracts to develop oil and gas fields in Iran.

The Securities and Exchange Commission said Total made more than $150 million in profits through the alleged bribery scheme. The SEC said Total attempted to cover up the nature of the payments by entering into sham consulting agreements with intermediaries of the Iranian official.

The agency said Total then described the payments in its records as legitimate “business development expenses.”

“Total used illicit payments to win business in Iran, and reaped substantial financial benefits as a result,” Andrew M. Calamari, director of the SEC’s New York regional office, said in a statement.

According to the SEC, Total negotiated a development contract in 1995 with the National Iranian Oil Co. (NIOC) to explore the Sirri A and E oil and gas fields. Before executing the contract, Total met with the Iranian official and agreed to enter into a consulting agreement and make payments to an intermediary he designated, the SEC said.

Total agreed to disgorge $153 million in profits and retain a consultant to report on its compliance with the Foreign Corrupt Practices Act. In parallel criminal proceedings at the Justice Department, Total agreed to pay a $245.2 million penalty as part of a deferred prosecution agreement. Total had set aside cash reserves in July in anticipation of a settlement.

Total also was charged Wednesday by François Molins, the prosecutor of Paris, for alleged violations of French laws.

“It’s my understanding that Total didn’t even know it was subject to the FCPA at the time and the only reason it is is that it is listed in the U.S.,” said Robin West, chairman of the Washington consulting firm PFC Energy. “This was 18 years ago, and it’s clear the rules have changed for everybody, including Total. And Total certainly understands that.”

Total’s chief financial officer, Patrick de la Chevardière, said in a statement that “these settlements . . . allow us to put an end to this investigation.”

“We look forward to continuing our work and demonstrating our strong commitment to ensuring ethical and legal compliance with the laws around the world,” he said.

Steven Mufson covers the White House. Since joining The Post, he has covered economics, China, foreign policy and energy.
Comments
Show Comments

Sign up for Today's Headlines

Start every morning with the most important stories.

Most Read Business