By Marcy Gordon
Thursday, September 4, 2008
A former chief executive of construction firm KBR pleaded guilty yesterday to federal bribery charges in connection with the company's natural gas operations in Nigeria from 1995 to 2004.
The Justice Department said Albert "Jack" Stanley entered a guilty plea in federal court in Houston to conspiring in a decade-long scheme to bribe Nigerian government officials in return for engineering and construction contracts. He also pleaded guilty to a separate count of conspiring to defraud KBR and others, admitting to receiving $10.8 million in kickbacks from a consultant hired by the company at his behest.
Under his plea agreement, Stanley, 65, faces a prison sentence of seven years and payment of $10.8 million in restitution.
The government said the seven-year term is the longest sentence to date against an individual in a case involving the Foreign Corrupt Practices Act, which makes it unlawful to bribe foreign government officials or company executives. A number of U.S. and foreign companies have been charged with violating the law in recent years.
"Today's plea demonstrates that corporate executives who bribe foreign government officials in return for lucrative business deals can expect to face prosecution," Matthew Friedrich, acting assistant attorney general, said in a statement.
Stanley acknowledged in his plea that a four-company joint venture including KBR paid about $182 million to consulting firms that then paid bribes to several Nigerian government officials.
In a separate settlement with the Securities and Exchange Commission, Stanley agreed to an injunction against future violations of the securities laws and to cooperate in the SEC's investigation. He neither admitted nor denied wrongdoing in that settlement.
Stanley was chief executive of Houston-based KBR until 2001 and its chairman until June 2004. He has been "and will continue to cooperate with the government," said his attorney Larry Veselka.
The Justice Department and the SEC have been investigating for some time the alleged bribery scheme in Nigeria involving Kellogg, Brown & Root, now called KBR, and three other companies that are based in France, Italy and Japan. The probe centered on a contract for a $4 billion Nigerian liquefied natural gas plant that was awarded in 1995 to a consortium of the four companies.
KBR, a major engineering and construction services company with operations around the world, was split off as a separate public company from oilfield services conglomerate Halliburton last year. Vice President Cheney was Halliburton's chief executive from 1995 to 2000.