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U.S. v. James K. Tillery and Paul G. Novak

 
:
Willbros - Novak, Paul G.
:
DOJ Criminal
:
January 17, 2008
:
U.S. v. James K. Tillery and Paul G. Novak
:
U.S. v. James K. Tillery and Paul G. Novak, No. 4:08-cr-00022-1 (S.D. Tex. 2008)
:
Novak was an expatriate living in South Africa. The DOJ compelled his return by having his U.S. passport revoked after obtaining a sealed indictment.

Further, Willbros International Inc. ("WII"), for whom Novak had been an agent, sued Novak and a former employee, Tillery, for breach of fiduciary duty after it entered into a deferred-prosecution agreement. WII seeks, inter alia, actual damages incurred by WII as a result of defendants' conduct, treble damages for violations of the RICO Act, and disgorgement of all amounts WII paid to defendants between 1999 and 2005.
:
Energy (Non-Utility)-Oil & Gas-Other/Multi
:
Ecuador, Nigeria
:
2003; 2004; 2005
:
1) officials of state-owned Nigerian National Petroleum Corporation ("NNPC"); 2) officials of NNPC's subsidiary National Petroleum Investment Management Services ("NAPIMS"); 3) a senior official in the executive branch of the Nigerian federal government; 4) officials in the dominant political party in Nigeria; and 5) officials of state-owned PetroEcuador and its subsidiary PetroComercial.
:
On January 17, 2008, a grand jury indicted Novak on one count of conspiracy to violate the FCPA and two substantive counts of violating the FCPA. The indictment also charged one count of conspiracy to commit money laundering. The indictment remained under seal until December 19, 2008, when U.S. authorities arrested Novak at a Houston airport. He was returning to the U.S. from South Africa after his U.S. passport was revoked. On January 27, 2009, the court granted the return of Novak’s passport, and he is out on bail pending a jury trial set for August 10, 2009.

As alleged in a criminal indictment, Paul G. Novak, a U.S. citizen, represented two consulting companies that allegedly acted as conduits for corrupt payments to foreign officials in Nigeria authorized by Willbros International, Inc. ("WII") employees. James K. Tillery, a U.S. citizen, is a former officer and employee of WII and another Willbros Group, Inc. ("WGI") subsidiary. Tillery and others allegedly authorized Novak to enter into corrupt negotiations with, and make payments to, Nigerian officials who had influence over awarding government construction contracts to obtain and retain favorable treatment in oil and gas pipeline construction contract decisions for WII and WGI subsidiaries. By late 2004, more than $1 million in corrupt payments allegedly had been paid to Nigerian officials, with millions more to be paid under commitments made to Nigerian officials. From January to March 2005, during an internal investigation and after Tillery and Novak had left the company or were no longer retained, Tillery and Novak's co-conspirators are alleged to have fraudulently obtained approximately $1.85 million dollars in cash to fulfill a portion of the remaining commitments. The money was then provided to consultants for delivery to Nigerian officials. Tillery and Novak's co-conspirators included Jim Bob Brown and Jason Edward Steph - former WII employees who separately have pleaded guilty to FCPA violations, a Nigerian national who performed purported consulting services for one or more of Willbros' Nigerian subsidiaries, and Nigeria-based employees of a major German construction and engineering firm with whom Willbros' Nigerian subsidiaries had formed a consortium to acquire business.

Additionally, Tillery and Novak, along with several other individuals, allegedly agreed to make corrupt payments of at least $300,000 to Ecuadorian officials to obtain a contract for the rehabilitation of a gas pipeline for WII. Novak, at the direction of Tillery, allegedly made a $150,000 corrupt payment by wire transfer to an Ecuadorian bank account.

On November 12, 2009, Novak pleaded guilty to conspiring to violate the FCPA and one substantive bribery charge. He was sentenced on May 3, 2013.
:
Anti-bribery (Domestic Concern), Conspiracy - Anti-Bribery
:
Fine, Imprisonment, Plea
:
On May 3, 2013, Novak was sentenced to 15 months imprisonment and two years' supervised release. He was also ordered to pay a $1 million fine.
:
1,000,000
:
15
:
Agent of Domestic Concern
:
U.S.
:
Contract Procurement/Retention
:
390,500,000
:
Cash, Wire/check
:
Direct, Sales Agent/Consultant
:
4,200,000
:
Ecuador, Nigeria
:
Ecuador, Lebanon
:
No