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FCPA Blog Daily News

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Monday
Dec202010

Former Latin Node Execs Charged

The DOJ announced the arrest today of two former executives of Miami-based telecommunications company Latin Node Inc. (LatiNode). They're charged with paying more than $500,000 in bribes to government officials in Honduras.
 
Jorge Granados, 54, the company's former CEO, and Manuel Caceres, 64, a former vice president, were indicted on December 14 by a federal grand jury. They made their court appearance today. They're each charged with with one count of conspiracy to violate the FCPA, 12 counts of violating the FCPA, five counts of money laundering, and one count of conspiracy to commit money laundering. The indictment also asks for criminal forfeiture.

The DOJ alleged the defendants and others at LatiNode agreed to bribe a manager of the state-owned telecommunications company Empresa Hondureña de Telecomunicaciones, known as Hondutel, and a senior attorney for Hondutel who acted as the manager’s “straw man,” and a minister of the Honduran government who became a representative on the Hondutel board of directors.

In 2006 and 2007, the defendants allegedly paid more than $500,000 in bribes, concealing some of the payments by laundering the money through LatiNode subsidiaries in Guatemala and accounts in Honduras controlled by the Hondutel officials.  

In early 2007, eLandia International Inc. announced an agreement to acquire LatiNode. The indictment alleges that during the due diligence for the acquisition, the defendants hid the bribery by creating phony consulting contracts.

After it acquired LatiNode and discovered the bribes, eLandia self disclosed potential FCPA violations to the DOJ and fired some senior executives.

In April 2009, LatiNode pleaded guilty to a one-count information charging the company with a criminal violation of the FCPA. It paid a $2 million fine. A copy of the plea agreement is here.

Before most of its business was discontinued by eLandia, LatiNode provided wholesale telecommunications services to a number of developing countries by leasing lines from local phone companies.

Granados and Caceres face up to five years in prison on the conspiracy and FCPA counts, and up to 20 years on the money-laundering charges. 

View the DOJ's December 20, 2010 release here.

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