Keppel Offshore & Marine agreed in 2017 to pay US$422 million to authorities in the US, Brazil and Singapore after admitting its agent paid about US$55 million in bribes to win Petrobras contracts over a 13-year scheme.
The resolution, announced in December 2017, was one of the largest foreign-bribery settlements ever involving a Singapore company. According to the US Department of Justice, between 2001 and 2014 Keppel paid approximately US$55 million in bribes to officials of Brazil's state oil company Petrobras and to figures connected with the country's then-governing party, securing 13 contracts with Petrobras and another Brazilian entity, Sete Brasil. The payments were funnelled through the company's former Brazilian agent, Zwi Skornicki, disguised as outsized commissions, earning Keppel roughly US$350 million in profits from the tainted projects.
Under the coordinated global settlement, Keppel O&M entered a deferred prosecution agreement with the DOJ, accepted a conditional warning from Singapore's Corrupt Practices Investigation Bureau, and signed a leniency agreement with Brazil's federal prosecutors. Of the US$422 million total, US$211.1 million went to Brazil and US$105.5 million each to the United States and Singapore. The penalty reflected a 25 per cent reduction for Keppel's cooperation, remedial measures and discipline of employees. A former senior member of Keppel O&M's legal department pleaded guilty in the US to conspiring to violate the Foreign Corrupt Practices Act.
The matter did not end there. In 2022 Keppel reached a further joint resolution with Brazil's Attorney-General and Comptroller General, paying about US$65 million in fines and damages to the Brazilian federal treasury and Petrobras, finally closing its liability in the country. Back home, CPIB issued stern warnings to six former senior management staff over the bribe payments.
Keppel's then-chairman Lee Boon Yang said the company regretted and was deeply disappointed by actions that took place in its offshore and marine business in Brazil, stressing that illegal payments by agents would not be tolerated. The scandal stained the reputation of a national champion shipbuilder and became a landmark in cross-border anti-corruption enforcement, cited ever since as proof that even agents' bribes, paid half a world away, can come home to roost.
The settlement was the US Justice Department's first coordinated foreign-bribery resolution with Singapore, and it reverberated across the city-state's corporate sector. Compliance departments at government-linked companies overhauled their agent and intermediary policies, and the case is still taught as a warning that distance is no defence: bribes paid through a middleman in Brazil can still end with a Singapore boardroom paying hundreds of millions.