Wood Group settles Amec bribery case in $177 million agreement

(Bloomberg) --John Wood Group Plc said it agreed to pay $177 million to settle a UK-led bribery and corruption probe into a British engineering firm it acquired in 2017.

The settlement is part of a so-called deferred prosecution agreement with the Serious Fraud Office and the U.S. Department of Justice concerning Amec Foster Wheeler Plc, Wood Group said in a statement Friday. The UK agreement is still subject to court approval. As part of the deal, the company can avoid prosecution for three years if it cooperates in the continuing bribery probe.

Wood Group’s payment is one of the largest ever obtained in a UK-led bribery and corruption case. The biggest was a $1.2 billion settlement with Airbus SE that also involved U.S. and French authorities.

In 2017, the SFO opened an investigation into Amec’s use of third parties to gain contracts, just weeks after Wood Group’s proposed acquisition was approved by shareholders. The DOJ said the probe concerned a scheme to pay bribes to officials in Brazil for a $190 million contract to design a gas-to-chemicals complex.

As part of the deal announced Friday, at least $10.1 million will go to settle charges brought by the U.S. Securities and Exchange Commission, the agency said in a separate statement. The DOJ said it will get about $18.4 million to resolve its criminal charges in the Brazil bribery probe. Amounts to be paid to the UK and Brazil are yet to be made public.

On Thursday, Wood Group announced that it was close to a settlement. It originally said it expected a deal for $186 million, with about $60 million to be paid in the first half of 2021 and the rest over three years. The company also said it had agreed to pay $10 million to Scottish authorities earlier this year to settle the case there.

“The investigations brought to light unacceptable, albeit historical, behaviour that I condemn in the strongest terms,” Wood Group Chief Executive Officer Robin Watson said in a statement. “Although we inherited these issues through acquisition, we took full responsibility in addressing them, as any responsible business would.”

The company has “cooperated fully with the authorities” and “taken steps to further improve our ethics and compliance program from an already strong foundation,” Watson said. “I’m pleased that, subject to final court approval in the UK, we have been able to resolve these issues and can now look to the future.”

The agreement comes amid criticism of the SFO and its inability to prosecute individuals after securing settlements with companies. Earlier this year, the SFO dropped its probe into former Airbus directors and was dealt a humiliating setback after its trial against two former Serco Group Plc directors fell apart because it failed to disclose evidence.

In May, the SFO opened one of its biggest investigations yet, into suspected fraud and money laundering in relation to GFG Alliance and its financing agreements with Greensill Capital. It was after months of intense pressure from lawmakers to investigate Sanjeev Gupta’s empire.