USA: Pride International Settles FCPA Issues and Comments on Compliance Program
- Business & Finance
Pride International, Inc. announced that it completed its settlement with the U.S. Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) of outstanding U.S. Foreign Corrupt Practices Act (FCPA) matters that were voluntarily and promptly self-reported to the DOJ and the SEC in February 2006 after they were discovered in an internal review.
The combined DOJ and SEC settlements require Pride and an international subsidiary to pay a total of $56.2 million, for which a charge was taken in the fourth quarter of 2009, and do not require Pride to have a compliance monitor.
Court papers filed jointly by the DOJ and Pride cite not only Pride’s “exemplary” cooperation, but also the many enhancements Pride has made to its antibribery compliance program over the last five years, noting that the company’s current board of directors and management team “have repeatedly demonstrated a strong compliance ‘tone at the top'” to reinforce the company’s “unwavering commitment to ethics and compliance.” In November 2010, Pride’s compliance program was recognized by Corporate Secretary magazine for having the best overall governance, compliance and ethics program of any small to mid-cap company in the United States.
Louis A. Raspino, President and Chief Executive Officer of Pride International, commented, “In addition to self-reporting in February 2006 and voluntarily cooperating with the government, we have greatly strengthened and enhanced our antibribery compliance program and policies. Our current management and board are strongly committed to conducting the company’s business ethically and legally, and we seek to instill in our employees the expectation that they uphold the highest levels of honesty, integrity, ethical standards and compliance with the law.”
“Beginning in 2005, our company has undertaken a significant business transformation,” Raspino said. “We are now stronger and more strategically focused, and it has been our goal to bring these FCPA issues to a close. As a result of our transformation, Pride now has an industry-leading ethics and compliance program, and our employees understand their accountability.”
Under the terms of the settlement, Pride Forasol S.A.S., an international subsidiary of Pride acquired in 1997, pleaded guilty today in U.S. District Court in Houston to FCPA charges. Pride Forasol was sentenced by U.S. District Judge Lynn Hughes to pay a fine of $32.625 million. The DOJ and Pride International, Inc. have entered into a three-year deferred prosecution agreement. If Pride remains in compliance with the agreement, at the conclusion of the term, the charges against Pride will be dismissed with prejudice. Also, in November 2010, Pride settled civil FCPA charges with the SEC, agreeing to an injunction against further violations of the FCPA and disgorgement and prejudgment interest totaling $23.5 million. No civil penalties were sought or imposed by the SEC.
Pride International, Inc., headquartered in Houston, Texas, operates a fleet of 25 rigs, including four deepwater drillships, 12 semisubmersible rigs, seven independent leg jackups and two managed deepwater rigs. The company also has two ultra-deepwater drillships under construction. The company’s floating rig fleet operates primarily offshore Brazil and West Africa.
Source: Pride International , December 8, 2010;