The United States unsealed criminal charges Tuesday against one current and one former executive of French power company Alstom's U.S. unit for an Indonesia bribery scheme.
Frederic Pierucci, 45, a French citizen and current Alstom executive in charge of sales, was charged in an indictment unsealed Tuesday in the District of Connecticut, where Alstom's U.S. affiliate is based.
He was charged with conspiring to violate the Foreign Corrupt Practices Act and to launder money, as well as substantive charges of violating the FCPA and money laundering.
Pierucci was arrested Sunday night at New York's John F. Kennedy International Airport.
David Rothschild, 67, of Massachusetts, a former vice president of sales for Alstom USA, pleaded guilty on November 2, 2012, the DOJ said.
In his plea deal unseal Tuesday, he was charged with one count of conspiracy to violate the FCPA.
The DOJ said,
According to the charges, Pierucci and Rothschild, together with others, paid bribes to officials in Indonesia, including a member of Indonesian Parliament and high-ranking members of Perusahaan Listrik Negara (PLN), the state-owned and state-controlled electricity company in Indonesia, in exchange for those officials’ assistance in securing a contract for the company to provide power-related services for the citizens of Indonesia, known as the Tarahan project. The charges allege that, in order to conceal the bribes, the defendants retained two consultants purportedly to provide legitimate consulting services on behalf of the power company and its subsidiaries in connection with the Tarahan project. In reality, however, the primary purpose for hiring the consultants was allegedly to use the consultants to pay bribes to Indonesian officials.
One consultant allegedly received hundreds of thousands of dollars into his Maryland bank account to be used to bribe the Indonesian member of parliament, the DOJ said.
The money was then allegedly transferred to a bank account in Indonesia for the benefit of the official.
Alstom made big up-front payments to another consultant, the DOJ said, so that the consultant could 'get the right influence.'
Paris-based Alstom provides equipment and services for power generation and high-speed rail transport. It operates in more than 70 countries with 93,000 employees. Its ADRs trade in the pink sheets under the symbol ALSMY.PK.
A story in 2011 reported that the company was in settlement talks with the U.K.'s Serious Fraud Office. The story said the SFO thinks Alstom may have used a U.K.-based shell company to pay 'at least £81 million in corrupt payments to foreign officials between 2004 and 2010' in Africa and the Middle East, among other places.
Swiss authorities fined Alstom Network Schweiz AG about $40 million in late 2011. After a two year investigation covering fifteen countries, Alstom was charged with corporate negligence for not taking 'all necessary and reasonable organizational precautions to prevent bribery of foreign public officials in Latvia, Tunisia, and Malaysia.'
In the U.S. charges, the FCPA conspiracy and substantive counts are punishable by up to five years in prison and fines between $100,000 and $250,000.
The money-laundering conspiracy and substantive counts carry a maximum penalty of 20 years in prison and a fine of $500,000.
As the DOJ says, an indictment is merely an accusation, and defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.