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Harry Cassin Publisher and Editor

Andy Spalding Senior Editor

Jessica Tillipman Senior Editor

Richard L. Cassin Editor at Large

Elizabeth K. Spahn Editor Emeritus 

Cody Worthington Contributing Editor

Julie DiMauro Contributing Editor

Thomas Fox Contributing Editor

Marc Alain Bohn Contributing Editor

Bill Waite Contributing Editor

Shruti J. Shah Contributing Editor

Russell A. Stamets Contributing Editor

Richard Bistrong Contributing Editor 

Eric Carlson Contributing Editor

Bill Steinman Contributing Editor

Aarti Maharaj Contributing Editor


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Tuesday
Jul012014

Enforcement Report for Q2 2014

There was a big FCPA settlement by Hewlett Packard during the prior quarter, nine individual indictments were announced, an appellate court ruled on who's a foreign official, and there was a DOJ declination.

Here's what happened (the dates are when the actions were reported here): 

DOJ / SEC Enforcement Resolutions

Hewlett Packard (April 9) paid $108 million to settle DOJ and SEC charges for bribes in Mexico, Russia, and Poland. HP paid fines of $74.2 million to resolve the DOJ's criminal case and $29 million in disgorgement.

Indicted / Arrested

Joseph Sigelman (May 12), 43, the former CEO of PetroTiger, was charged with conspiracy to violate the FCPA and to commit wire fraud, conspiracy to launder money, and substantive FCPA and money laundering offenses. He's accused of bribing an official at Ecopetrol SA, Colombia’s state-controlled oil company, and defrauding PetroTiger by taking kickbacks.

Dmitry Firtash (April 2), 48, a Ukrainian national, was arrested March 12, 2014, in Vienna, Austria. He was released on March 21 after posting bail equivalent to $174 million. The DOJ is trying to extradite him to face U.S. charges for an racketeering conspiracy with FCPA violations in an alleged scheme to pay $18.5 million in bribes to officials in India to gain titanium mining rights.

Andras Knopp (April 2), 75, a Hungarian businessman, indicted with Firtash and charged with conspiracy to violate the Foreign Corrupt Practices Act, among other offenses. He's at large.

Suren Gevorgyan (April 2), 40, of Ukraine, indicted with Firtash and charged with conspiracy to violate the FCPA, among other offenses. He's at large.

Gajendra Lal (April 2), 50, an Indian national and permanent resident of the United States who formerly resided in Winston-Salem, North Carolina, indicted with Firtash and charged with conspiracy to violate the FCPA, among other offenses. He's at large.

Periyasamy Sunderalingam (April 2), 60, of Sri Lanka, indicted with Firtash and charged with conspiracy to violate the FCPA, among other offenses. He's at large.

K.V.P. Ramachandra Rao (April 2), 65, a member of parliament in India and former official of the state of Andhra Pradesh, was also indicted with Firtash. He's charged along with the other five defendants with one count each of a racketeering conspiracy and a money laundering conspiracy, and two counts of interstate travel in aid of racketeering. He's not charged under the FCPA. The DOJ has asked India to arrest him.

Benito Chinea (April 14), 47, the former CEO of Direct Access Partners LLC, was charged in federal court in New York for bribery involving Venezuela’s state bank. A 15-count indictment included one count of conspiracy to violate the FCPA and the Travel Act, five counts of violating the FCPA, and five counts of violating the Travel Act.

Joseph DeMeneses (April 14), 44, a former partner of Direct Access Partners was also charged in the 15-count indictment of paying kickbacks to a vice president of finance at Banco de Desarrollo Economico y Social de Venezuela, or BANDES, in exchange for the bank’s bond-trading business.

Appeals

Joel Esquenazi (May 19) lost an appeal of his conviction and 15-year sentence. The unanimous three-judge panel from the U.S. Court of Appeals for the Eleventh Circuit affirmed the DOJ's interpretation of "foreign official" to include officials at state-owned Telecommunications D’Haiti. A jury had convicted Esquenazi of one count of conspiracy to violate the FCPA and wire fraud, seven substantive FCPA counts, one count of money laundering conspiracy, and 12 counts of money laundering. His 15-year sentence is the longest in FCPA history.

Carlos Rodriguez (May 19), was Esquenazi's co-defendant. The appellate court affirmed his seven-year sentence.

Declinations

Smith & Wesson (June 23) said the DOJ has ended its FCPA investigation of the company and won't bring criminal charges, and that a civil settlement with the SEC is close. The DOJ launched its investigation into the gun maker after the 2010 indictment of its VP for sales at the start of the bumbled Africa sting prosecution. Smith & Wesson wasn't charged but it received a grand jury subpoena for its records.

*     *    *

Our prior enforcement reports are here:

Enforcement Report for Q1 2014

_______

2013 FCPA Enforcement Index

2012 FCPA Enforcement Index

2011 FCPA Enforcement Index

2010 FCPA Enforcement Index

2009 FCPA Enforcement Index

2008 FCPA Enforcement Index

__________

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

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