Settlements

ST-413
Bechtel / Power Generation Engineering and Services Company (PGESCo) / Asem M. Elgawhary
Bechtel / Power Generation Engineering and Services Company (PGESCo)
United States
Department of Justice
Egypt
2015
3/23
Unknown
Individual
Criminal
Guilty Plea
Criminal Forfeiture
$5,258,995
$0
$5,258,995
$0
NA
Art.16
Art. 1, Art. 2, Art. 7
Mail Fraud, Conspiracy to Commit Money Laundering, Interference with Administration of Internal Revenue (Tax) Laws in relation to an FCPA bribery scheme
Mail Fraud, Conspiracy to Commit Money Laundering, Interference with Administration of Internal Revenue (Tax) Laws in relation to an FCPA bribery scheme
Yes
According to the US Department of Justice, "Asem Elgawhary [ ] pleaded guilty on Dec. 4, 2014, to mail fraud, conspiracy to commit money laundering, and obstruction and interference with the administration of the tax laws. In imposing sentence today [the Court] also ordered Elgawhary to forfeit $5.2 million. From 1996 to 2011, Elgawhary was assigned by Bechtel—a U.S. corporation engaged in engineering, construction and project management—to be the general manager at Power Generation Engineering and Services Company (PGESCo), a joint venture between Bechtel and Egypt’s state-owned and state-controlled electricity company, known as EEHC. PGESCo assisted EEHC in identifying possible subcontractors, soliciting bids and awarding contracts to perform power projects for EEHC. According to his plea agreement, Elgawhary admitted to accepting a total of $5.2 million from three power companies, which they paid to secure a competitive and unfair advantage in the bidding process. One of the power companies, Alstom S.A., together with a Swiss subsidiary, pleaded guilty on Dec. 22, 2014, to violations of the Foreign Corrupt Practices Act (FCPA) in connection with a scheme to pay bribes to foreign officials, including Elgawhary, in various countries. As Elgawhary admitted in his plea agreement, he attempted to conceal the kickback scheme by routing the payments through various off-shore bank accounts, including Swiss bank accounts, under his control. Elgawhary also sent various documents and “Representation Letters” to Bechtel executives and members of the PGESCo Board of Directors, falsely certifying that he had no knowledge or suspicion of any fraud at PGESCo, and that there were no possible violations of law or regulations that should have been considered for disclosure in PGESCo’s financial statements. Elgawhary also admitted that, in a further attempt to conceal the scheme, he made misrepresentations to counsel for Bechtel when he was interviewed in April 2011. Elgawhary further admitted to obstructing and interfering with tax laws by failing to report any of the kickback payments as income for the tax years 2008 through 2011 and providing false information about foreign bank accounts." (Source: US Department of Justice Press Release, "Former Bechtel Executive Sentenced to 42 Months in Prison and Ordered to Forfeit $5.2 Million in Connection with Kickback Scheme," March 23, 2015.)