The Justice Department yesterday charged that Ruston Gas Turbines Inc. did business with a U.S. firm knowing that the firm was bribing Mexican officials.
Ruston, a Houston corporation with sales of approximately $80 million in 1981, is the second company to be charged as a result of a wide-ranging federal grand jury investigation of dealings by American oil field equipment companies with Petroleos Mexicanos (Pemex).
Earlier this week Ruston was one of three companies named in a document filed by the Justice Department in California that alleged a complex bribery scheme in which two Pemex officials were paid nearly $10 million.
The company, a subsidiary of the Ruston Gas Turbines Ltd., faces fines of up to $1 million in connection with the offense. Ruston is expected to enter into a plea bargain agreement with federal prosecutors.
The government provided scant detail about Ruston's alleged involvement yesterday. But in papers filed in connection with a plea agreement between C. E. Miller Corp. of Irvine, Calif. and its president, Charles E. Miller, considerable detail already had been given. The company and Miller had been charged with aiding and abetting the bribery.
According to that document, Ruston joined with Crawford Enterprises Inc. of Houston and an International Harvester subsidiary in a pricing arrangement in which prices were padded to cover up bribes. The government said that Crawford had set up a system for bribing two high-ranking Pemex officials in 1977.
Beginning in 1978 and lasting into 1979 when the federal investigation began, a "pricing pattern" emerged. Crawford, with Miller's help, would calculate the prices to be bid by CEI, the International Harvester subsidiary and Ruston, according to the government.
Crawford built into each bid a percentage for the "folks," a term the government said Crawford used to conceal the identity of the Mexican officials. The government identified them as Ignacio DeLeon, subdirector in charge of purchasing, and Jesus Chavarria, subdirector for trade. Both men have since left Pemex.
More charges are expected to be filed in the case soon.