Two former chief executive officers of PetroTiger Ltd. – a British Virgin Islands oil and gas company with operations in Colombia and offices in New Jersey – have been charged for their alleged participation in a scheme to pay bribes to foreign government officials in violation of the Foreign Corrupt Practices Act (FCPA), to defraud PetroTiger, and to launder proceeds of those crimes.
In addition, PetroTiger’s former general counsel pleaded guilty to bribery and fraud charges in connection with the same alleged scheme.
According to the charges, former co-CEOs of PetroTiger Joseph Sigelman, formerly of Miami and the Philippines, and Knut Hammarskjold, of Greenville, South Carolina, former general counsel Gregory Weisman, of Moorestown, New Jersey, and others allegedly paid bribes to an official in Colombia in exchange for the official’s assistance in securing approval for an oil services contract worth roughly $39 million.
Sigelman and Hammarskjold were charged with conspiracy to commit wire fraud, conspiracy to violate the FCPA, conspiracy to launder money, and substantive violations of the FCPA.
Weisman has pleaded guilty to a criminal information charging one count of conspiracy to violate the FCPA and to commit wire fraud.
The charges alleged that the defendants made three separate payments from PetroTiger’s bank account in the United States to the official’s bank account in Colombia to secure approval from Colombia’s state-owned and state-controlled oil company for a lucrative oil services contract in the country. According to the charges, to conceal the bribes, the defendants first attempted to make the payments to a bank account in the name of the foreign official’s wife, for purported consulting services she did not perform. The charges alleged that Sigelman and Hammarskjold provided Weisman invoices including her bank account information. The defendants allegedly made the payments directly to the official’s bank account when attempts to transfer the money to his wife’s account failed.
In addition, court documents alleged that the defendants attempted to secure kickback payments at the expense of PetroTiger’s board members. According to the criminal charges, the defendants were negotiating an acquisition of another company on behalf of PetroTiger, including on behalf of several members of PetroTiger’s board of directors who were helping to fund the acquisition. In exchange for negotiating a higher purchase price for the acquisition, two of the owners of the target company agreed to kick back to the defendants a portion of the increased purchase price, the government contended. According to the charges, to conceal the kickback payments, the defendants had the payments deposited into Sigelman’s bank account in the Philippines, created a “side letter” to falsely justify the payments, and used the code name “Manila Split” to refer to the payments amongst themselves.
The conspiracy to commit wire fraud count carries a maximum penalty of 20 years in prison and a fine of the greater of $250,000 or twice the value gained or lost. The conspiracy to commit violations of the FCPA count carries a maximum penalty of five years in prison and a fine of the greater of $250,000 or twice the value gained or lost. The FCPA counts each carry a maximum penalty of five years in prison and a fine of the greater of $250,000 or twice the value gained or lost. The conspiracy to commit money laundering count carries a maximum penalty of 20 years in prison and a fine of the greater of $500,000 or twice the value of the property involved in the transaction. Contact the author at firstname.lastname@example.org.
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