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Monday
Mar102014

Cilins pleads guilty to obstructing bribe investigation

Frederic Cilins, 51, a French citizen, pleaded guilty Monday in the Southern District of New York to obstructing a federal criminal investigation into whether a mining company paid bribes to win mining rights in the Republic of Guinea.

Cilins pleaded guilty to a one-count superseding information, the DOJ said.

The information alleged Cilins agreed to pay money to induce a witness to destroy documents sought by the FBI. The documents related to allegations of bribes paid to obtain mining concessions in the Simandou region of the Republic of Guinea, located in West Africa.

Cilins was arrested in Jacksonville, Florida in April last year.

He worked for Israeli billionaire Beny Steinmetz' operations in Guinea, Reuters said.

According to the DOJ, Cilins tried to obstruct an ongoing federal grand jury investigation concerning potential violations of the Foreign Corrupt Practices Act and money laundering laws.

The DOJ said a federal grand jury was investigating "whether a particular mining company and its affiliates -- on whose behalf Cilins had been working -- transferred into the United States funds in furtherance of a scheme to obtain and retain valuable mining concessions in the Republic of Guinea’s Simandou region."

Cilins was heard in recorded phone calls and meetings agreeing to pay money "to induce a witness to the bribery scheme to turn over documents to Cilins for destruction, which Cilins knew had been requested by the FBI and needed to be produced before a federal grand jury," the DOJ said.  

"Court documents also allege that Cilins sought to induce the witness to sign an affidavit containing numerous false statements regarding matters under investigation by the grand jury," the DOJ said.

The documents Cilins wanted destroyed included contracts between the mining company and its affiliates and the former wife of a now-deceased Guinean government official. At the time, the official could influence the award of mining concessions, the DOJ said.

The official’s wife incorporated the company in 2008.

"That same contract," the DOJ said, "stipulated that $2 million was to be transferred to the official’s wife’s company" and more money to others involved in granting the mining rights.

The mining company Cilins worked for also agreed to give five percent of its ownership in the mining areas in Guinea to the official’s wife, the DOJ said.

Obstruction is punishable by up to five years in prison.

No sentencing date was announced.

The DOJ's March 10, 2014 release is here.

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Richard L. Cassin is the publisher and editor of the FCPA Blog. He can be contacted here.