Richard L. Cassin Publisher and Editor

Andy Spalding Senior Editor

Jessica Tillipman Senior Editor

Michael Scher
Senior Editor

Elizabeth K. Spahn 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

FCPA Blog Daily News

Entries in Burma (13)


U.S. lifts most Burma sanctions, shows ‘strong support’ for new government

Aung San Suu Kyi, State Counsellor of Myanmar, The U.S. Department of the Treasury’s Office of Foreign Assets Control amended the Burmese Sanctions Regulations Tuesday to support trade with Burma.

Click to read more ...


Judge rejects Fokker's ‘anemic’ $21 million sanctions penalty

A federal judge Thursday refused to approve a settlement of sanctions violations by a subsidiary of Dutch aerospace firm Fokker Technologies Holding.

Click to read more ...


New Myanmar laws for foreign investment and anti-corruption

Street market in Yangon, Myanmar. (Photo courtesy of Wikimedia Commons)As part of the reforms by President Thein Sein to open up Myanmar after decades of economic isolation, the parliament has approved a new foreign investment law.

Click to read more ...


Burma's Dissidents Return From Exile

Former dissidents are returning to Burma after the government removed more than 2,000 names from a list used to refuse entry to exiled opponents of the country's former military rulers and other critics.

Click to read more ...


Myanmar: Nowhere To Go But Up 

A bleak assessment: What the U.S. Commerce Department said about corruption in Myanmar in a 2012 publication.

Click to read more ...


Suu Kyi's Amazing Journey

Aung San Suu Kyi traveled to Thailand this week for the World Economic Forum on East Asia. It's the first time in 24 years the ruling junta allowed her to leave Myanmar.

Click to read more ...


Aon Pays $16.2 Million In Settlement

Aon Corporation, one of the biggest insurance brokerage firms in the world, agreed today to settled FCPA charges with the DOJ and SEC.

Click to read more ...


POTUS Walks ASEAN's Mean Streets

President Obama meets tomorrow on Bali, Indonesia with the heads of state from ASEAN -- the Association of Southeast Asian Nations.

Click to read more ...


The Return Of Hope

The deal we went to Yangon to work on never happened. So we packed our bags and left. But the memory of that big white house that didn't look like a prison never left us.

Click to read more ...


The Bribes Of War

War is not only hell, it's corrupt too. Of the bottom ten countries on Transparency International's 2010 Corruption Perception Index, six have active wars, insurrections, or major civil disturbances.

Click to read more ...


Trees Fall To Graft

In Malaysia this week, four forestry department officials, including the director, an officer and two rangers, were arrested for taking a $30,000 bribe. In exchange, they allegedly awarded illegal logging concessions. Malaysia has prized hardwoods growing in protected areas in and around its rain forests. The arrests came after an investigation by the Malaysian Anti-Corruption Commission. According to the Malaysia Star (here), more than $100,000 in cash was seized from the house of the forestry department director, who "is said to be a millionaire." The anti-corruption team is now investigating the sources of his wealth. He and the other suspects are being held "to assist in investigations." So far this year, Malaysian authorities have made 23 arrests in 21 cases of illegal logging.

* * *
The NGO Global Witness has investigated illegal logging in several Southeast Asian countries. For example, in late 2006, its investigators posed as buyers at flooring companies. Thirteen out of 14 lumber suppliers they talked to in China said they could obtain timber from Burma across the land border despite import restrictions. Chinese companies export timber throughout the world, including to Europe and America. Global Witness said some U.S.-based companies still advertise Burmese wood flooring on their websites even though the Lacey Act now bans commerce in illegally obtained timber and wood products.

"This is just part of a wider problem," Global Witness said. "Half of China's timber imports from all countries are probably illegal and China accounts for roughly a quarter of all illegal timber being traded internationally. . . . This has a knock-on effect for other countries. For example, the U.K. imports more illegal timber than any other EU country because it buys so much from China."

* * *
The United States has banned several Cambodian officials from entering the country because of their complicity in illegal logging. The 2008 Consolidated Appropriations Act included a requirement that the U.S. Secretary of State keep a running list of foreign government officials and their family members who have been involved in corruption relating to the extraction of natural resources in their countries. The law requires the State Department to designate individuals on the list as ineligible for United States visas under Presidential Proclamation 7750 (see our post here). In June 2007, Global Witness published details about corrupt ties among Cambodian timber barons and Prime Minister Hun Sen, his wife, and other senior officials.

* * *
According to Transparency International (here), illegal cutting represents as much as 80 percent of the total lumber production in some countries. "Estimates suggest that almost $2.5 billion worth of stolen timber is traded between East and South Asian countries each year. Around the world, annual losses from illegal logging on public lands have been estimated at over $10 billion by the World Bank."

* * *
Back in Malaysia, the government announced this week that the Malaysian Anti-Corruption Commission Academy will receive training assistance from Interpol. The head of the Malaysian commission said, “Corruption is no longer a local matter to contain. It has become a global issue. With globalization and the world now being borderless where every country is doing business with every other country, unchecked corruption can pose a threat to integrity in all countries, thus giving a new meaning to the term cross-border corruption." Interpol is the world's largest international police organization, with 188 member countries. Malaysia ranks 47th on the Corruption Perception Index, tied with Cape Verde, Costa Rica, Hungary, and Jordan.


Aon Pays £5.25 Million Corruption Fine

The U.K.'s Financial Services Authority said yesterday that it has fined Aon Ltd £5.25 million ($8.05 million) for failing to recognize and control the risks of overseas payments being used as bribes. The fine is the largest the FSA has levied for financial crimes. Aon Ltd is the principal U.K. subsidiary of Chicago-based Aon Corporation, the world's biggest insurance broker.

Aon Corporation disclosed in November 2007 an internal investigation into possible violations of the Foreign Corrupt Practices Act and non-U.S. anti-corruption laws. Aon said then in its Form 10-Q that it had self-reported the investigation to the Department of Justice, the Securities and Exchange Commission and others, and that it had already agreed with U.S. prosecutors to toll any applicable statute of limitations. The U.S. investigations are still pending.

This is now the third case brought by U.K. authorities involving overseas bribery by U.K. companies. In September 2008, the Overseas Anti-Corruption Unit of the City of London Police said an employee of CBRN Team Ltd, a U.K. security consulting firm, and an official of Uganda, had pleaded guilty to bribery charges. The CBRN employee received a suspended sentence and the Ugandan official was sentenced to twelve months in jail. And in October last year, the U.K.'s Serious Fraud Office reached a £2.25 million civil settlement with construction firm Balfour Beatty plc for alleged unlawful accounting in connection with overseas "payment irregularities" which it self-reported.

Apparently to emphasize the new willingness of her agency and other U.K. authorities to prosecute overseas bribery, Margaret Cole, the FSA's director of enforcement, said:

The involvement of UK financial institutions in corrupt or potentially corrupt practices overseas undermines the integrity of the UK financial services sector. The FSA has an important role to play in the steps being taken by the UK to combat overseas bribery and corruption. We have worked closely with other law enforcement agencies in this case and will continue to take robust action focused on firms’ systems and controls in this area.
According to its website, the Financial Services Authority is an independent non-governmental body with statutory powers under the Financial Services and Markets Act 2000. It has a range of rule-making, investigatory and enforcement powers intended to "promote efficient, orderly and fair financial markets and help retail financial service consumers get a fair deal." The Treasury appoints its 12-member board.

Between January 2005 and September 2007, according to the FSA, Aon Ltd didn't properly assess or control the risks involved in its dealings with overseas firms and individuals who helped it win business. "As a result of Aon Ltd’s weak control environment, the firm made various suspicious payments, amounting to approximately US$7 million, to a number of overseas firms and individuals." The payments were made in Bahrain, Bangladesh, Bulgaria, Burma, Indonesia and Vietnam.

The FSA said Aon cooperated fully and agreed to settle early in the investigation, qualifying for a 30% discount under the FSA’s settlement discount scheme. Without the discount the fine would have been £7.5 million.

View the FSA's January 8, 2009 release here.

Download the FSA's Final Notice (January 6, 2009) here.

View Aon's January 8, 2009 statement here.