SEC/DOJ Investigation of FCPA Violations by a Fortune 500 Energy Firm

Cornerstone Research and Professor Roman Weil of the University of Chicago assisted a large provider of energy-related products and services in SEC and DOJ investigations regarding a former subsidiary’s alleged violations of the Foreign Corrupt Practices Act (FCPA).

Retained by Baker Botts

Cornerstone Research and Professor Roman Weil of the University of Chicago assisted a large provider of energy-related products and services in SEC and DOJ investigations regarding a former subsidiary’s alleged violations of the Foreign Corrupt Practices Act (FCPA). The SEC and DOJ alleged that a joint venture, in which the subsidiary and three other venturers each owned approximately 25 percent, had bribed foreign government officials to win multi-billion-dollar construction contracts in Nigeria.

Professor Weil’s analysis provided significant support for the company’s settlement negotiations with the SEC and DOJ.

Cornerstone Research and Professor Weil calculated profits from the joint venture, which the SEC demanded the company and its former subsidiary disgorge, and which were relevant to the DOJ’s penalty analysis for the subsidiary. Professor Weil reviewed the financial statements, cost reports, dividend distributions, foreign exchange gains and losses, and intercompany revenue and cost allocations of both the subsidiary and the joint venture. Professor Weil also estimated the company’s cost of capital in acquiring and owning the joint venture. Professor Weil’s analysis provided significant support for the company’s settlement negotiations with the SEC and DOJ. Cornerstone Research provided counsel representing the company with real-time analysis throughout the negotiations. Our client settled with the SEC and DOJ.