Ex CEO Tagged in Bribery Case Vs Innospec Over FCPA Violation
Charges against Innospec Inc. continue to unfold as new lawsuit filed by the Securities and Exchange Commission (SEC) before the U.S. District Court for the District of Columbia indicts its former chief executive officer of taking part in the bribery act committed with foreign government officials, violating the Foreign Corrupt Practices Act (FCPA).
The SEC charged March 18, 2010 the Delaware-based chemical company Innospec, Inc. with bribery connected to the payments worth $9.2 million it issued to government officials of Iraq and Indonesia to obtain and retain its tetra-ethyl lead (a fuel additive) deal worth $176 million with the state-owned companies and oil refineries there.
After ordering Innospec to pay $40.2 million in global settlement to be paid to the SEC, DOJ, and the Department of the Treasury’s Office of Foreign Assets Control, and the Serious Fraud Office in UK, the SEC seeks former chief executive officer Paul Jennings to disgorge $116,092 plus prejudgment interest of $12,945 and a penalty of $100,000 for allegedly approving the bribes paid to foreign government officials by his company. Jennings was the chief financial officer at the time the bribery took place.
The SEC’s lawsuit alleges that Jennings approved the annual certifications given to auditors containing falsely represented financial statements, books, and internal controls of the company. SEC also claimed Jennings lied when he said he had complied with Innospec’s Code of Ethics incorporating the Company’s FCPA policy.
In the same complaint, the SEC said Jennings tolerated the scheme to pay an official at the Trade Bank of Iraq for favorable exchange rate on the letters of credit. The SEC added that aside from the bribery, Innospec sought assurance from the Ministry of Oil to flunk the field test of a competitor product.