ABB VETCO GRAY, INC. AND ABB VETCO GRAY UK LTD. PLEAD GUILTY TO FOREIGN BRIBERY CHARGES

WASHINGTON, D.C. - Assistant Attorney General Christopher A. Wray of the Criminal Division announced today that ABB Vetco Gray Inc. and ABB Vetco Gray UK Ltd., the United States and United Kingdom subsidiaries of Swiss company ABB Ltd., have pleaded guilty to a criminal information charging each of the two companies with two counts of bribery in violation of the Foreign Corrupt Practices Act.

Both companies entered their pleas this morning, at a hearing before Judge Vanessa Gilmore at the U.S. District Court for the Southern District of Texas in Houston.

ABB Vetco Gray is a U.S. company based in Houston, Texas and is the headquarters for Vetco Gray’s Western Hemisphere operations. ABB Vetco Gray UK Ltd. is based in Aberdeen, Scotland and is headquarters for Vetco Gray’s Eastern Hemisphere operations.

The criminal information charges that the two companies paid bribes to officials of NAPIMS, a Nigerian government agency that evaluates and approves potential bidders for contract work on oil exploration projects in Nigeria, including bidders seeking subcontracts with foreign oil and gas companies. According to the stipulated statement of facts, the companies paid more than $1 million in exchange for obtaining confidential bid information and favorable recommendations from Nigerian government agencies in connection with seven oil and gas construction contracts in Nigeria from which the companies expected to realize profits of almost $12 million.

“Companies that think they can bribe their way into overseas contracts are sadly mistaken,” said Assistant Attorney General Wray. “Businesses that attempt to manipulate the free market by paying off foreign officials will face serious consequences for dishonest and illegal activity.”

ABB Vetco Gray Inc., the U.S. subsidiary, is charged under 15 USC Section 78dd-2, the FCPA section applying to “domestic concerns.” ABB Vetco Gray UK Ltd. is charged under 15 USC Section 78dd-3, the FCPA section that was added in 1998 to implement the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Technology by expanding FCPA’s coverage to foreign companies that take an act in furtherance of the bribe of a foreign official while in the United States. This is the second case to charge a foreign company under this section.

As part of the plea agreement, each company has agreed to pay a fine of $5.25 million.

In a separate action, the U.S. Securities and Exchange Commission, which conducted a parallel investigation, filed a complaint against the parent company, ABB Ltd., the stock of which is traded in the United States through American Depository Receipts. The SEC complaint alleges violations of anti-bribery, books and records, and internal control provisions of the FCPA, arising from suspected payments in Nigeria, Kazakhstan and Angola. ABB Ltd. has agreed to a civil settlement that includes the hiring of an outside consultant to review its system of internal controls, disgorgement of profits and pre-judgement interest of $5,915,405.64, and a civil penalty payment of $10.5 million, which is to be deemed satisfied by payment of the criminal fine.

ABB Ltd. voluntarily disclosed the suspicious payments to the Department of Justice and the SEC in late 2003. Subsequently, the company agreed to provide “real-time” disclosure of the results of a joint investigation conducted by lawyers for ABB Ltd. and lawyers representing the purchasers of ABB’s Vetco Gray group of companies.

The case was prosecuted by the Fraud Section of the Criminal Division.

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