Ex-SBM executives were jailed for bribing foreign public officials in exchange for lucrative oil-services contracts

Oct 25, 2022 News

Kaieteur News – In September 2018, the former Chief Executive Officer (CEO) and a former sales and marketing executive of Dutch oil services company SBM, a company that has already established its presence in Guyana, were both jailed for bribing foreign public officials in exchange for lucrative oil-services contracts.

Former Chief Executive Officer (CEO) of SBM, Anthony ‘Tony’ Mace

SBM Offshore is the one designing the floating, production, storage and offloading (FPSO) vessels for American oil giant ExxonMobil’s projects in Guyana.

In the U.S, the former SBM executives were jailed for their involvement in bribing government officials in countries like Brazil, Angola and Equatorial Guinea.

According to the U.S. Department of Justice, Anthony “Tony” Mace, then 66, of the United Kingdom, the former CEO of SBM Offshore, and a former Board Member of SBM’s U.S.-based subsidiary, was sentenced to serve 36 months in prison and a fine of US$150,000 – while Robert Zubiate, then 66, of Agoura Hills, California, a former sales and marketing executive at SBM USA, was sentenced to serve 30 months in prison and a fine of US$50,000 for the crime.

In November 2017, Mace and Zubiate each pleaded guilty to one count of conspiracy to violate the Foreign Corrupt Practices Act (FCPA) in connection with a scheme to bribe foreign government officials in Brazil, Angola and Equatorial Guinea.

According to admissions made in connection with his plea agreement, Mace acknowledged that prior to him becoming CEO, other employees of SBM entered into an agreement to pay bribes to foreign officials including at Brazil’s state-controlled oil company, Petróleo Brasileiro S.A. (Petrobras); Angola’s state-owned oil company, Sociedade Nacional de Combustíveis de Angola, E.P. (Sonangol); and Equatorial Guinea’s state-owned oil company, Petroléos de Guinea Ecuatorial (GEPetrol).

The former CEO admitted too that he joined the conspiracy by authorizing payments in furtherance of the bribery scheme and deliberately avoided learning that those payments were bribes.

In particular, Mace maintained a spreadsheet reflecting payments to five individuals. He acknowledged that even though he was aware there was a high risk those individuals were Equatorial Guinean officials, he nevertheless authorized SBM to make over US$16 million in payments to those individuals.

As it relates to the Brazilian government officials, Mace stated that he further continued a practice that was instituted before he became CEO by splitting payments to SBM’s Brazilian intermediary that is, paying a portion of the intermediary’s commission to an account in Brazil and another portion of the agent’s commission to accounts in Switzerland held in the name of shell companies.

Again, Mace deliberately avoided learning that the ultimate recipients of the payments that he authorized to the shell companies were Petrobras officials, he admitted.

According to admissions made in connection with Zubiate’s plea, from between 1996 and 2012, Zubiate and others used a third-party sales agent to pay bribes to foreign officials at Petrobras in exchange for those officials’ assisting SBM and SBM USA with winning lucrative offshore oil projects from Petrobras. Zubiate also admitted engaging in a kickback scheme with the bribe-paying sales agent for SBM and its SBM USA.

For his part, former Assistant Attorney General Brian A. Benczkowski had said, “Anthony Mace and Robert Zubiate played key roles in a massive bribery scheme that involved the payment of millions of dollars to public officials in exchange for lucrative oil-services contracts.” According to Benczkowski, the former SBM executives’ actions rewarded corrupt officials’ greed and tilted the playing field against honest, law-abiding companies.

The former U.S official had stated that Mace and Zubiate’s sentencing should serve as a warning to corporate executives everywhere.

Notably, in November 2017, SBM entered into a US$238 million three-year deferred prosecution agreement with the United States over its role in the conspiracy, while its subsidiary, SBM USA, pleaded guilty to one count of conspiracy to violate the FCPA.

On the local front, SBM Offshore has been the preferred shipbuilder for Guyana’s FPSO vessel since 2015. To date, the company has built the FPSOs for the Liza Destiny, the Liza Unity, Payara – each costing approximately US$1B, US$1.2B, and US$1.6B respectively.

Kaieteur News recently reported that SBM Offshore is making moves to deepen its Guyanese roots as it recently issued a Request for Information (RFI) from qualified companies to develop a gated community and recreational facility for its employees.