Business & Economy Keppel's about-turn: Some of our transactions are "suspicious"

Keppel’s about-turn: Some of our transactions are “suspicious”

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By: 永久浪客/Forever Vagabond


Keppel announced on Monday (3 Oct) that after further internal investigations, it now recognises that certain transactions associated with its Brazil agent, Mr Skornicki, may be “suspicious”.

Keppel said it has notified the authorities in the relevant jurisdictions of its intention to cooperate and work towards the resolution of the underlying issues arising from or in connection with the “suspicious” transactions.

“The matter continues to be under review and Keppel will make further announcements as appropriate. Shareholders are advised to exercise caution when dealing with the securities of Keppel,” it said.

“Keppel reiterates its zero-tolerance stance against any form of illegal activity, including bribery and corruption, involving its employees or associates.”

Top Keppel executives accused of bribing Brazilian officials

On 21 Jul, Mr Skornicki testified in a Brazilian court that top executives in Keppel authorized him to pay bribes so as to win contracts with the state-controlled Brazilian Petroleum Corporation (Petrobras). The contracts were believed to be worth billions of dollars (https://theindependent.sg/top-keppel-executives-accused-of-bribing-officials-in-brazil).

At the time, Keppel came out strongly denying all of Skornicki’s allegations made against the company and its officials.

Mr Skornicki told the court that 5 Keppel top executives were involved. They were named in the Brazilian court:
 1. Chow Yew Yuen, Keppel Offshore & Marine CEO
 2. Tong Chong Heong, former senior executive at Keppel Corp
 3. Tay Kim Hock, former CEO of Keppel Fels Brasil
 4. Kwok Kai Choong, current CEO at Keppel Fels Brasil
 5. Choo Chiau Beng, a former Keppel Corp CEO and current non-resident ambassador to Brazil

They were said to have known about and authorized the bribes to the Brazilian officials, according to Mr Skornicki’s testimony. He testified that he had a formal contract with Keppel to represent the company and he was given enough autonomy to sign contracts with Petrobras on behalf of Keppel.

He used the same accounts where Keppel paid him his agent fee to bribe officials, he said. He further testified that the kickbacks went to Petrobras officials and people including Joao Vaccari, who was the treasurer for the Workers’ Party of Brazil, a member of the ruling coalition. Vaccari was already sentenced last year to 15 years in jail for corruption and for managing bribes for his political party.

Presently, investigations – called Carwash investigations – against leading politicians from the Brazilian ruling coalition are on-going. They are being investigated for using their influence to hand pick members of Petrobras’s top management, who then collected bribes and shared the proceeds with their political benefactors.

In fact, Keppel was first cited in the Carwash case in Feb last year when a former Petrobras executive from the engineering and services division, Pedro Barusco, testified that he had earned millions from bribes coming from supposedly Keppel and other shipyards.

In Oct last year, the Brazilian parliamentary inquiry recommended further investigation into 10 companies it identified as being involved in illegal transactions with Petrobras and its subsidiaries. Keppel admitted that one of its units, Keppel Fels Brasil, is on the list.

And in Feb this year, it was reported that when the Brazilian federal investigators launched a series of arrests and raids against the people involved in the carwash corruption probe, the prosecutors said they were also looking into possible bribes paid off contracts signed by Petrobras and its subsidiaries with Keppel Fels.

Choo Chiau Beng is ambassador to Brazil

One of the 5 named, Choo Chiau Beng, is the former Keppel Corp CEO and current non-resident ambassador to Brazil. In addition, he sits on the investment board of GIC and is also the Chairman of M1 board (https://theindependent.sg/spore-ambassador-named-in-brazilian-court-in-graft-probe).

Mr Choo has won many honors and awards:
• Public Service Star Award (BBM) in August 2004
• The Meritorious Service Medal in 2008
• Outstanding Chief Executive Award, Singapore Business Award in 2001
• NTUC Medal of Commendation (Gold) Award in May 2007
• International Maritime Centre (Individual) Award, Maritime and Port Authority of Singapore in 2009
• NBAS Award, Norwegian Business Association (Singapore) in 2010
• CEO of the Year, Singapore Corporate Awards in 2010
• SIAS Awards – Brendon Wood TopGun CEO Designation for Singapore CEOs, Securities Investors Association (Singapore) & Brendon Woods in 2012
• 11th Asia Business Leaders Awards – Corporate Social Responsibility Award, CNBC in 2012

It remains to be seen if any of the Keppel officials and Ambassador Choo will be implicated at the end of Brazil’s carwash investigations.

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