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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

FCPA Blog Daily News

« French Warrant For Alleged Kleptocrat | Main | Dahdaleh, Hall Appear In London Court »
Tuesday
Apr172012

Carsons Plead Guilty

Two former executives of Control Components Inc. became the second husband and wife convicted of FCPA offenses when they pleaded guilty Monday in federal court in Santa Ana, California.

Stuart Carson, 73, the former president of CCI, and Hong “Rose” Carson, 48, the director of sales for China and Taiwan, were charged in separate one-count criminal informations with making a corrupt payment to a foreign official.

Sentencing is scheduled for October 15. Under the plea deal, Stuart Carson faces up to ten months in prison. His wife Rose will avoid prison. She faces up to three years probation with six months of home confinement. 

CCI designs and manufactures service control valves for the nuclear, oil and gas, and power generation industries worldwide. It's a subsidiary of IMI plc of the U.K.

The Carsons and four other former CCI executives were charged in 2009 in a 16-count indictment with paying bribes to officials at state-owned companies.

The DOJ said corrupt payments went to officials at Jiangsu Nuclear Power Corp. (China), Guohua Electric Power (China), China Petroleum Materials and Equipment Corp., PetroChina, Dongfang Electric Corporation (China), China National Offshore Oil Corporation, Korea Hydro and Nuclear Power, Petronas (Malaysia), and National Petroleum Construction Company (United Arab Emirates).

The other defendants were Paul Cosgrove, CCI’s former director of worldwide sales, David Edmonds, CCI’s former vice president of worldwide customer service, Flavio Ricotti, the former CCI vice president of sales for Europe, Africa and the Middle East, and Han Yong Kim, the former president of CCI’s Korean office. 

Ricotti pleaded guilty in April 2011 to one count of conspiracy to violate the FCPA.

Cosgrove and Edmonds are scheduled to go on trial in June this year.

Two other CCI defendants pleaded guilty in 2009 to one count of conspiracy to violate the FCPA. Mario Covino, the former director of worldwide factory sales, and Richard Morlok, the former finance director, admitted bribing officials at foreign state-owned enterprises.

Covino, Morlok, and Ricotti are scheduled to be sentenced in November and December this year.

CCI pleaded guilty in 2009 to a three-count criminal information charging it with conspiracy to violate the FCPA and the Travel Act, and two substantive violations of the FCPA. It paid an $18.2 million criminal fine. 

It admitted paying $6.8 million in bribes from 2003 through 2007 to officers and employees at state-owned companies in 36 countries, generating $46 million in profit.

*     *     *

The first spousal FCPA co-defendants were Gerald and Patricia Green. They were convicted by a jury in 2009 and jailed for six months.

Enrique Faustino Aguilar Noriega and Angela Gomez Aguilar were charged in the Lindsey prosecution. She was convicted of money laundering and sentenced to time served. Her husband didn't appear for trial and remained a fugitive in Mexico.

In January this year, Cecilia Zurita, a former vice president of Cinergy Telecommunications Inc., was indicted in the Haiti telco case. Her husband, Washington Vasconez Cruz, had already been charged in the case.

*     *     *

In August last year, we asked if the Carsons were planning to plead guilty. Our post is here.

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