Litigation Release No. 19754 / July 5, 2006

Accounting and Auditing Enforcement Release No. 2456 / July 5, 2006

SEC v. John Samson, John G. A. Munro, Ian N. Campbell, and John H. Whelan, Civil Action No. 06 CV 01217(D.D.C.)

SEC Files FCPA Charges Against Four Former Senior Employees of ABB Ltd. Subsidiaries

The Securities and Exchange Commission announced today that it filed a civil injunctive action in the United States District Court for the District of Columbia charging four former employees of subsidiaries of ABB Ltd., with violating the anti-bribery provisions of the Foreign Corrupt Practices Act of 1977 ("FCPA"). ABB is a global provider of power and automation technologies headquartered in Zurich, Switzerland, and its American Depository Receipts are registered with the Commission and trade on the New York Stock Exchange. All four defendants agreed to settle the charges against them, without admitting or denying the allegations in the Commission's complaint.

The Commission's complaint alleges that the four former employees -- John Samson, a former regional sales manager for West Africa, John G. A. Munro, a former senior vice president of operations, Ian N. Campbell, a former vice president of finance, and John H. Whelan, a former vice president of sales -- participated in a scheme by offering, approving, and/or paying bribes to Nigerian government officials in furtherance of ABB's bid to obtain a $180 million contract to provide equipment for an oil drilling project in Nigeria's offshore Bonga Oil Field. According to the complaint, as a result of the defendants' actions, during the period 1999 through 2001, ABB paid approximately $1 million in bribes to officials of National Petroleum Investment Management Services ("NAPIMS"), the Nigerian state-owned agency responsible for overseeing oil exploration and production in Nigeria. The Commission alleges that these illicit payments -- which took the form of both cash and gifts -- were intended to induce and reward NAPIMS officials for providing ABB with confidential competitor bid information, and securing favorable consideration of ABB's bid on the Bonga contract, which ultimately was awarded to ABB in early 2001.

The Commission alleges that during the tender process for the Bonga contract in 2000, Samson, the regional sales manager for West Africa, negotiated to pay six NAPIMS officials a total of $800,000 in bribes. The Commission further alleges that Samson subsequently informed Munro and Campbell of the payments promised to the NAPIMS officials. According to the complaint, at the direction of a senior officer (now deceased) of ABB's Vetco Gray U.S. subsidiary, Munro instructed Campbell and Samson to arrange payment to the NAPIMS officials using a local consultant as a conduit. The complaint alleges that Campbell arranged to funnel $800,000 in bribes to the consultant under the cover of false invoices for consulting work. The complaint also alleges that Samson personally profited from this bribery scheme by obtaining $50,000 in kickbacks from one the NAPIMS officials who received illicit payments.

In addition, the complaint alleges that between 1999 and 2001, Samson arranged for Whelan to provide cash and other gifts -- including lodging and meals -- to NAPIMS officials when they visited the United States. According to the complaint, these payments totaled more than $176,000.

The Commission's complaint alleges that Samson, Munro, Campbell and Whelan each violated the anti-bribery provisions of the FCPA, codified as Section 30A of the Securities and Exchange Act of 1934 ("Exchange Act"), and the books and records and internal accounting control provisions of Exchange Act Section 13(b)(5) and Rule 13b2-1 thereunder. The complaint further alleges that each defendant aided and abetted ABB's books and records and internal accounting control violations of Exchange Act Sections 13(b)(2)(A) and 13(b)(2)(B). Without admitting or denying the allegations in the complaint, Samson, Munro, Campbell and Whelan consented to the entry of final judgments that (1) permanently enjoin each of them from future violations of these provisions, (2) order each to pay a civil monetary penalty ($50,000 as to Samson, and $40,000 each as to Munro, Campbell and Whelan), and (3) orders Samson to pay $64,675 in disgorgement and prejudgment interest.

The Commission previously filed a settled enforcement action against ABB in connection with these and other illicit payments. See SEC v. ABB Ltd., Case No. 1:04CV1141 (D.D.C.)/Lit. Rel. 18775 (July 6, 2004). In that matter, without admitting or denying the allegations in the Commission's complaint, ABB consented to entry of a final judgment that provided for permanent injunctive relief, ordered ABB to pay $5.9 million in disgorgement and prejudgment interest, and ordered ABB to pay a $10.5 million civil penalty.

SEC Complaint in this matter