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FCPA Blog Daily News

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Friday
Jul012011

Enforcement Report For Q-2 '11

There were two mega settlements during the quarter. Both JGC and Johnson & Johnson made our top-ten list. And there were three other corporate resolutions under $10 million.

The Lindsey defendants -- the company and two officers -- were convicted during the quarter. Their sentencings, originally set for September 16, were vacated after the judge learned about more undisclosed grand jury tesitmony. The defendants' motion to dismiss will be heard on September 8.

There were four guilty pleas by individual defendants. And Gerald and Patricia Green, now indigent, were released after serving their six-month prison sentences. The government may be appealing their 'short' jail terms.

Here's a complete rundown for Q-2:

DOJ / SEC Enforcement Resolutions

JGC Corporation (April 6) -- the last of four TSKJ partners who together paid $180 million in bribes to Nigerian officials -- agreed to a $218.8 million criminal penalty to resolve FCPA-related charges. JGC's settlement is the sixth biggest Foreign Corrupt Practices Act case of all time on the current top ten list.

Comverse Technology Inc. (April 7) settled FCPA violations with the DOJ and SEC for $2.8 million, including a criminal penalty of $1.2 million and $1.6 million in disgorgement and pre-judgment interest. Comverse also received a non-prosecution agreement from the DOJ that expires in two years.

Johnson & Johnson (April 8) agreed to a $77 million resolution of FCPA-related offenses. It will pay a $21.4 million penalty to resolve criminal FCPA charges with the DOJ and $48.6 million in disgorgement and prejudgment interest to settle the SEC’s civil charges. The settlement also made our top ten list.

Rockwell Automation Inc. (May 3) settled an administrative proceeding with the SEC for bribes it paid in China. The company agreed to pay $2.8 million for the settlement, with disgorgement and interest of $2.4 million and a civil penalty of $400,000.

Tenaris (May 17) agreed to a $9 million settlement of FCPA charges, with $5.4 million in disgorgement and prejudgment interest to the SEC and a $3.5 million criminal penalty to the DOJ. The company became the first to enter into a deferred prosecution agreement with the Securities and Exchange Commission in any kind of enforcement action. 

Convicted

Lindsey Manufacturing (May 10) was convicted by a jury of one count of conspiracy to violate the Foreign Corrupt Practices Act and five substantive FCPA violations.

Dr. Keith Lindsey (May 10), 66, CEO of Lindsey Manufacturing, was convicted by a jury of one count of conspiracy to violate the Foreign Corrupt Practices Act and five substantive FCPA violations.

Steve K. Lee (May 10), 60, CFO of Lindsey Manufacturing, was convicted by a jury trial of one count of conspiracy to violate the Foreign Corrupt Practices Act and five substantive FCPA violations. All of the Lindsey defendants have a pending motion to dismiss, scheduled to be heard on September 8.

Guilty Pleas

Flavio Ricotti (April 29), 51, a former FCPA fugitive and Italian citizen, pleaded guilty in federal court in Santa Ana, California to a single count of conspiracy to violate the Foreign Corrupt Practices Act and the Travel Act. The former vice president for sales of Control Components Inc. was arrested in February last year in Frankfurt, Germany and extradited to the United States. He faces up to five years in prison.

Haim Geri (April 28), 51, one of the 22 shot-show defendants, pleaded guilty in the District of Columbia to one count of conspiracy to violate the Foreign Corrupt Practices Act. He now faces 18 to 24 months in prison and a $250,000 fine. A sentencing date wasn't set.

Manuel Caceres (May 18), Latinode's former vice president for business development, pleaded guilty to conspiracy to violate the FCPA.

Jorge Granados (May 19), 54, Latinode's former CEO, pleaded guilty to conspiracy to violate the FCPA's anti-bribery provisions. He's scheduled to be sentenced on August 22.

Released

Gerald Green (May 29), 79, and his wife Patricia, 56, were released from federal custody after serving their six-month jail sentences. They were convicted by an LA jury in 2009 of paying $1.8 million in bribes to Juthamas Siriwan, then-governor of the Tourism Authority of Thailand, in exchange for $13.5 million in contracts to produce the Bangkok film festival. The Greens were the first husband-and--wife to be convicted of FCPA violations.

_______________

Our Enforcement Report for Q-1 '11 is here.

Our 2010 FCPA Enforcement Index is here, the 2009 Index can be found here, and our 2008 Index here.

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