By The Corrupt Practices Investigation Bureau (CPIB), in a press statement on 12 January, about the stern warnings — in lieu of charges — issued to six former senior executives of the management staff of Keppel Offshore & Marine Limited (KOM) after close to five years of its investigations after consultation with the Attorney’s General Chambers (AGC),
CPIB was reported to have arrested the six former executives from KOM in Feb 2018 following the conclusion of investigations by the United States’ Department of Justice (DOJ). The six were subsequently let off on bail, and the matter was then referred to the AGC to decide if charges were to be filed.
The stern warnings issued to the six were over offences punishable under the Prevention of Corruption Act (PCA) for bribe payments to officials of Brazilian state-owned corporation Petróleo Brasileiro S.A. (Petrobras), pertaining to rigs-building contracts which Petrobras and/or its related companies had awarded to KOM.
As documented in the plea agreement signed by KOM in December 2017, beginning by at least 2001 and continuing until at least 2014, KOM conspired to violate US’ Foreign Corrupt Practices Act (FCPA) by paying approximately US$55 million in bribes to officials at the Brazilian state-owned oil company Petrobras, and to the then-governing political party in Brazil, in order to win 13 contracts with Petrobras and another Brazilian entity.
KOM and its related entities, including KOM USA, are said to have earned profits totalling approximately US$159.9 million from the contracts.
And although the six were also not named by CPIB and DoJ in its report, a report by Bloomberg in 2016 on the court proceedings at a Brazilian court over the bribery case shed light on the matter.
The Consultant who assisted KOM in bribing the Brazilian officials was identified as Zwi Skornicki. He reportedly told the court that five Keppel executives were involved.
They are:
- Chow Yew Yuen, then-current Keppel Offshore & Marine CEO
- Tong Chong Heong, former senior executive at Keppel Corp
- Tay Kim Hock, former CEO of Keppel Fels Brasil
- Kwok Kai Choong, then-current CEO at Keppel Fels Brasil
- Choo Chiau Beng, a former Keppel Corp CEO and former non-resident ambassador to Brazil
As for the sixth executive, Jeffery Shiu Chow, a US citizen, was reported to have cut a deal to help prosecutors in their probe of Keppel and other former executives. Chow pleaded guilty on 29 Aug 2017 to conspiring to violate the FCPA as part of his deal to cooperate. He admitted to drafting contracts that were used to make bribe payments, according to court records.
Tong Chong Heong’s involvement in Keppel’s previous corruption charge in 1997
Mr Tong, one of the six executives investigated and left off with a stern warning by CPIB, has been with Keppel for a long time and has held various senior appointments in the company since 1972.
During Mr Tong’s appointment as Executive Director of Keppel FELS, Keppel Shipyard was fined $300,000 after pleading guilty to paying $8.53 million in bribes to Mr Cornelius van der Horst, a manager of Petroleum Shipping, a British unit of oil giant Exxon Corp.
The bribes were given between 1992 and 1995 to reward him for helping Keppel get contracts to repair 17 of Exxon’s tanks.
It was reported that Mr Tong was involved in making the decision to give Mr van der Horst a 1 per cent cut of the contract sum for all tenders awarded to Keppel by Petroleum Shipping.
Investigations by CPIB revealed that since 1992, Keppel Shipyard had been successful in nearly all its tenders to Petroleum Shipping
No charge from CPIB was ever made against Mr Tong or the other directors involved.
Despite having been involved in the conviction of Keppel Shipyard in 1997, Mr Tong was conferred Singapore’s Public Service Medal (PBM) in August 1999.
During this period, Mr Tong was also assuming the appointment of the Commander of the Volunteer Special Constabulary (VSC) from 1995-2001.
Mr Tong was then appointed as the CEO of KOM from 1 January 2009 to 31 January 2014 and then appointed Chairman of Keppel Integrated Engineering (KIE) on 3 August 2009 after serving on the KIE board since 1999.
He also served as Executive Director on the Keppel Corporation Board since 1 August 2009 and the Chairman of Keppel FELS Brasil SA; and Senior Executive Director of Keppel Corporation Limited.
All these appointments were held during which the bribery in Brazil took place.
With the overlapping senior management appointments that Mr Tong had in Keppel, it would be incredible to say that he did not know what was going on or had no say over how things were handled.
Looking at how CPIB handled the 1997’s incident, had it not been for US DoJ’s investigations and media reports, it would probably be unlikely for the six to be investigated in the first place.