Jeffrey Tesler, a British solicitor, pleaded guilty in Texas to counts of conspiracy and of violating the US Foreign Corrupt Practice Act (‘FCPA’), which criminalises the bribery of foreign public officials. The FCPA applies to foreign agents of US companies located outside the US and Mr Tesler faces a possible jail sentence of up to 10 years imprisonment together with a fine of up to $150,000 at his sentencing hearing on 22 June 2011.  Mr Tesler was arrested in London in February 2009 and was subsequently extradited to the US in March 2011.

This matter relates to the payment of bribes over a period of 10 years to Nigerian government officials for the award of contracts to build a liquefied natural gas facility on Bonny Island in Nigeria. Mr Tesler acted for Kellog Brown & Root (‘KBR’),  a US engineering company and former subsidiary of the US company Halliburton, once headed up by the 46th US Vice President Dick Cheney.

Mr Tesler admitted funneling bribes worth more than $130m (£80m) to Nigerian officials on behalf of four construction firms who were joint venture partners. The payments were made via bank accounts in Monaco and Switzerland.

In the same matter, Halliburton and KBR have already agreed to pay $579 million in settlement with the US Authorities, whereas the Italian company ENI SpA and its former Dutch subsidiary Snamprogetti Netherlands BV agreed to pay jointly $125 million to settle with the US prosecutors. Likewise, in June 2010, the French Group ,Technip,  agreed to pay the sum of $338 million.

On 16 February this year in the UK, following an action commenced by the Serious Fraud Office (‘SFO’), the High Court made an order under Part 5 of the Proceeds of Crime Act 2002 against MW Kellogg Limited (‘MWKL’) to pay over £7 million in disgorgement. These monies represented share dividends arising from profits generated by criminal activity relating to the same Nigerian matter.

This matter illustrates the extraterritorial effect of the FCPA and shows that co-operation by prosecuting authorities in various jurisdictions can lead to heavy fines and jail sentences being imposed on international companies and individuals.  The Bribery Act, once in force, will have similar effects and could lead to similar prosecutions under sections 6 and 7, including severe prison sentences and unlimited fines and the possibility of debarment from public procurement in the US and in the European Union.