MAS, CAD investigating Seatrium over potential offences relating to Brazil corruption case

SINGAPORE - Singapore authorities are conducting a joint investigation into offences potentially committed by Seatrium, formerly Sembcorp Marine, relating to a massive and long-running corruption case in Brazil, dubbed Operation Car Wash.

The Monetary Authority of Singapore and the Commercial Affairs Department have requested for further information from the company for the purpose of the Investigations, Seatrium said in a filing with the Singapore Exchange on June 15.

The offences were potentially committed by the company and/or its officers when it was then Sembcorp Marine, before its renaming in 2023 after the merger with Keppel Offshore & Marine.

They fall under the Securities and Futures Act 2001, the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act 1992, and all previous versions of those laws.

Seatrium said it continues to provide its full cooperation to the Singapore authorities.

The company will continue to monitor the situation and make appropriate announcements in the event of any material developments. In the meantime, shareholders and potential investors were advised to exercise caution when dealing in its shares.

Seatrium shares closed down 1.77 per cent at $1.67 last Friday (June 14).

The company announced in March that Singapore’s Attorney-General’s Chambers (AGC) was agreeable to entering a deferred prosecution agreement (DPA) with Seatrium following the alleged corruption offences in Brazil.

Seatrium was fined US$110 million (S$149 million) fine in connection with the alleged corruption offences in Brazil dating back some 15 years. But of this, the AGC is agreeable to credit up to US$53 million of the payments to the Brazilian authorities against the penalty. As such, Seatrium would only have to pay the remaining US$57 million or $76.5 million.

In a subsequent response to queries from SGX on April 1, Seatrium said that the agreement is not definitive yet and is subject to AGC’s agreement and the approval of Singapore’s High Court.

Additionally, two former executives of the group were charged with corruption offences on March 28 for paying bribes of more than $20 million to further the company’s business interests in Brazil.

The offshore and marine energy engineering company in February posted a $1.68 billion net loss for the second half of its 2023 financial year, a more than tenfold increase from the $118.3 million loss for financial year 2022.