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« Measuring Misery | Main | The Bribes Of War »
Wednesday
Oct272010

SFO Cuts Plea Deal With Insurance Exec

The U.K. Serious Fraud Office said Tuesday that an insurance broker who copped a plea was sentenced to 21 months in prison for bribing Costa Rican officials to win business there.

Julian Messent, 50, admitted paying about $2 million to employees at the state-owned insurance company, Instituto Nacional de Seguros, and the national electricity and telecommunications provider, Instituto Costarricense de Electricidad.

Messent was charged in April 2010. He negotiated a plea deal that was concluded by September. He appeared in Crown Court on October 22 to admit the charges.

Earlier this year, two U.K. judges warned the SFO not to make plea deals that purported to bind the courts in sentencing decisions. The judges said the SFO had exceeded its authority by agreeing to sentences with defendants in overseas corruption cases involving former DePuy executive Robert John Dougall and Delaware-based Innospec.

The judicial warnings threw into doubt the SFO's whistleblower program and its partnership with the U.S. Justice Department in resolving international graft cases.

But in announcing Messent's sentencing, the SFO said it had worked out his plea deal under the March 2009 attorney general's guidelines for plea discussions in cases of serious or complex fraud.

The guidelines restrict the SFO and other prosecuting agencies from usurping judicial authority. "Where a plea agreement is reached," the guidelines say, "it remains entirely a matter for the court to decide how to deal with the case."

Insurance broker Messent was also ordered to pay £100,000 compensation within 28 days to Costa Rica or serve an additional 12 months in prison.

The SFO and the City of London Police opened their joint investigation in 2006. Messent was a director of London-based insurance business PWS International Ltd. Between February 1999 and June 2002, he authorized 41 corrupt payments totalling $1,982,230.77. The money went directly to Costa Rican officials, and to their wives and associated companies, the SFO said.

View the SFO's October 26, 2010 release here.

Reader Comments (1)

What is not contained in the SFO press release are details of the judges remarks when it came to sentencing. We gave details of these in our post on Tuesday on http://www.thebriberyact.com

In summary we understand from sources close to the case that the judge indicated that but for the plea agreement (or to put it more bluntly the co-operation Mr. Messent gave in relation to the prosecution) the sentence the judge would have imposed would have been more in the region of between 4 (four) to 5 (five) years.

We understand the judge stressed the importance of the plea agreement as being the most important saving grace as far as the defendant is concerned.

The outcome of this case underscores the importance of the plea agreement approach of the SFO in cases like these and highlights the benefits for defendants of entering into them. In this case, we know because the judge has told us, that without the plea deal the sentence would have been approximately double or more.

There can be no doubt then about the benefits of co-operation here.

The UK position is not as clear cut as the US position and it is heavily nuanced. In some ways it appears less certain. The prosecution cannot agree a sentence with the defence as part of the plea agreement and the discretion for sentencing must be left in the hands of the judge. That has always been the position and the judge firmly said so again in Innospec.

We prefer to look at outcomes. We understand that there will not be a written judgment of this case. However, we are seeking further details which we expect to receive in the next few days as it is clearly an important taste of what the future holds. When we have more information we shall post again.

Finally thanks for the FCPA Blog.

We're big fans.
October 28, 2010 | Unregistered CommenterBarry Vitou

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