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FCPA Blog Daily News

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Wednesday
Jun122013

Brokerage boss charged in Venezuela kick back scheme

The DOJ Wednesday arrested the former head of the Miami office of brokerage firm Direct Access Partners for conspiracy to bribe an officer at a state-owned Venezuela bank in exchange for bond trading business.

Ernesto Lujan, 50, became the fourth criminal defendant in the case. Two brokers from New York-based Direct Access were charged last month with paying at least $5 million in bribes to an official at Banco de Desarrollo Económico y Social de Venezuela (BANDES).

The bank official was charged with taking the bribes.

Lujan faces substantive FCPA and Travel Act offenses and conspiracy counts. He's also charged with two money laundering-related counts. The FCPA and Travel Act offenses are punishable by up to five years in prison. Money-laundering offenses carry a maximum penalty of 20 years in prison.

He was arrested Wednesday morning in Wellington, Florida, where he lives.

The two brokers arrested last month face the same charges. They are Tomas Alberto Clarke Bethancourt, also known as Tomas Clarke, and Jose Alejandro Hurtado. Both live in Miami and were arrested there.

The bank official who allegedly took the bribes is BANDES vice president of finance, María de los Ángeles González de Hernandez.

She was charged last month with Travel Act conspiracy and substantive offenses, and two money laundering-related counts.

She lives in Caracas, Venezuela but was also arrested in Miami.

The SEC said Wednesday it added Lujan to a civil complaint filed last month charging the two brokers and two other individuals with fraud and market manipulation.

The DOJ in May filed a related civil forfeiture action in Manhattan federal court seeking the forfeiture of several bank accounts in Switzerland and properties in the Miami area.

Direct Access Partners stopped doing business last month after the arrests, the Wall Street Journal reported. The paper said 'Goldman Sachs Execution & Clearing, the firm’s clearing agent, stopped accepting trades after that probe came to light on May 8, effectively shutting the firm down,' according to a source.

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The DOJ's June 13, 2013 release is here.

The SEC's June 13 release is here and its amended civil complaint is here.