The Department of Justice caught an Army sergeant (and his supervisor, a Master Sergeant) who took over $100,000 in bribes while in Afghanistan from vendors supplying goods for humanitarian relief.
It's not likely any PEP database would have identified these folks – yet look at the amounts involved.
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On February 27th, the Financial Crime Enforcement Network (FinCEN) assessed a $1.5 milliion civil monetary penalty (CMP) against First National Community Bank (FNCB) of Dunmore, Pennsylvania for violations of the Bank Secrecy Act (BSA) by not filing Suspicious Activity Reports (SARs) for transactions related to a judicial corruption scheme. The activity went unreported for a period of five years. Why? Probably because one of the two judges involved, a Michael Conahan, was on the bank's board of directors.
And what should have tipped FNCB off? From the FinCEN press release:
The unreported suspicious
transactions that flowed through Conahan’s and other FNCB accounts displayed red flags that
should have alerted FNCB to potential illicit activity and caused it to file suspicious activity
reports. These red flags included (1) a 2007 law enforcement subpoena for information related
to Conahan and other individuals and entities – although the Bank responded to the subpoena, it
did not conduct any further analysis or risk rate the accounts as required; (2) activity occurring as
early as 2005 involving many large, round-dollar transactions often occurring on a single day;
and (3) an abnormal volume of activity compared to account balances.
Links:
FinCEN Assessment of Civil Monetary Penalty
Thai banks, according to the Phuket Gazette, will now be required to report cash transactions over 500,000 Baht and property transactions over 1 million Bt by government officials and offices to the National Anti-Corruption Commission (NACC). This is in addition to the current reporting requirements to the Anti-Money Laundering Office (AMLO) of 2 million in cash or 5 million in property.
Link:
Thai banks to report B500k transactions to counter money laundering
Thai banks, according to the Phuket Gazette, will now be required to report cash transactions over 500,000 Baht and property transactions over 1 million Bt by government officials and offices to the National Anti-Corruption Commission (NACC). This is in addition to the current reporting requirements to the Anti-Money Laundering Office (AMLO) of 2 million in cash or 5 million in property.
Link:
Thai banks to report B500k transactions to counter money laundering
The FCPA Blog reports that the Serious Fraud Office (SFO) has questioned and detailed four current and former employees of an Airbus subsidiary. The investigation is into allegations that the subsidiary, GPT Special Project Management Ltd. provided bribes to Saudi officials to win a 2 billion GBP contract to upgrade satellite and Internat communication systems for the Saudi National Guard, which protects the royal family. The bribes included cash, cars and jewelry.
Link:
SFO arrests four Airbus employees in Saudi Arabia bribe probe
From the Justice Department, the full text of the statement:
Department of JusticeOffice of Public AffairsFOR IMMEDIATE RELEASEThursday, May 15, 2014Marubeni Corporation Sentenced for Foreign Bribery ViolationsMarubeni Corporation, a Japanese trading company involved in the handling of products and provision of services in a broad range of sectors around the world, including power generation, was sentenced today for its participation in a scheme to pay bribes to high-ranking government officials in Indonesia to secure a lucrative power project.
Acting Assistant Attorney General David A. O’Neil of the Justice Department’s Criminal Division, Acting U.S. Attorney Michael J. Gustafson of the District of Connecticut and Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office made the announcement.
Marubeni was sentenced by U.S. District Judge Janet B. Arterton in the District of Connecticut. Marubeni pleaded guilty on March 19, 2014, to one count of conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act (FCPA) and seven counts of violating the FCPA. The company signed a plea agreement in which it admitted its criminal conduct, agreed to maintain and implement an enhanced global anti-corruption compliance program and to cooperate with the department’s ongoing investigation, and agreed to pay an $88 million fine, which the court accepted in imposing the sentence. The plea agreement cites Marubeni’s refusal to cooperate with the department’s investigation when given the opportunity to do so, its lack of an effective compliance and ethics program at the time of the offense, and its failure to timely remediate as several of the factors considered by the department in determining the resolution.
According to the court filings, Marubeni and its employees, together with others, paid bribes to officials in Indonesia – including a high-ranking member of the Indonesian Parliament and high-ranking members of Perusahaan Listrik Negara (PLN), the state-owned and state-controlled electricity company in Indonesia – in exchange for assistance in securing a $118 million contract, known as the Tarahan project, for the company and its consortium partner to provide power-related services for the citizens of Indonesia. To conceal the bribes, Marubeni and its consortium partner retained two consultants purportedly to provide legitimate consulting services on behalf of the power company and its subsidiaries in connection with the Tarahan project. The primary purpose for hiring the consultants, however, was to use the consultants to pay bribes to Indonesian officials.
Also according to court filings, the first consultant retained by Marubeni and its co-conspirators received hundreds of thousands of dollars in his U.S. bank account to be used to bribe the member of Parliament. The consultant then allegedly transferred the bribe money to a bank account in Indonesia for the benefit of the official. E-mails between the co-conspirators discuss in detail the use of the first consultant to funnel bribes to the member of Parliament and the influence that the member of Parliament could exert over the Tarahan project.
As admitted in court documents, in the fall of 2003, Marubeni and its co-conspirators determined that the first consultant was not effectively bribing key officials at PLN. As a result, Marubeni and its consortium partner decided to reduce the first consultant’s commission from three percent of the total contract value to one percent, and pay the remaining two percent to a second consultant who could more effectively bribe officials at PLN. In an e-mail between two employees of Marubeni’s consortium partner, they discussed a meeting between Marubeni, an executive from the consortium partner, and the first consultant, stating that the consultant “committed to convince [the member of Parliament] that ‘one’ [percent] is enough.” Marubeni and its co-conspirators were successful in securing the Tarahan project and subsequently made payments to the consultants for the purpose of bribing the Indonesian officials.
Frederic Pierucci, a current executive at Marubeni’s consortium partner, pleaded guilty on July 29, 2013, to one count of conspiring to violate the FCPA and one count of violating the FCPA. David Rothschild, a former vice president of regional sales at the consortium partner, pleaded guilty on Nov. 2, 2012 to one count of conspiracy to violate the FCPA. Lawrence Hoskins, a former senior vice president for the Asia region for the consortium partner, and William Pomponi, a former vice president of regional sales at the consortium partner, were charged in a second superseding indictment on July 30, 2013.
This case is being investigated by FBI agents who are part of the Washington Field Office’s dedicated FCPA squad, with assistance from the Meriden, Connecticut, Resident Agency of the FBI. Significant assistance was provided by the Criminal Division’s Office of International Affairs. In addition, the department greatly appreciates the significant cooperation provided by its law enforcement counterparts in Indonesia at the Komisi Pemberantasan Korupsi (Corruption Eradication Commission), the Office of the Attorney General in Switzerland and the Serious Fraud Office in the United Kingdom.
The case is being prosecuted by Assistant Chief Daniel S. Kahn of the Criminal Division’s Fraud Section and Assistant U.S. Attorney David E. Novick of the District of Connecticut.
Additional information about the Justice Department’s FCPA enforcement efforts can be found atwww.justice.gov/criminal/fraud/fcpa .
Link:
Department of Justice Press Release
On Friday, the Canadian FIU issued guidance on the Ukrainian regulations (FACFOU) promulgated recently under the Freezing Assets of Corrupt Foreign Officials Act (FACFOA):
Freezing and Disclosure Obligations Under FACFOA All individuals and entities in Canada, and all Canadians outside of Canada, should be aware of the prohibition to conduct the following activities with corrupt foreign officials from Ukraine
1:
In addition, all individuals and entities in Canada, as well as every Canadian outside Canada, must advise the Commissioner of the Royal Canadian Mounted Police (RCMP) if they have property of any of these corrupt foreign officials in their possession or under their control; and information about a transaction or proposed transaction in respect of such property 2
2.
In accordance with these regulations, a corrupt foreign official is one that is named in the Freezing Assets of Corrupt Foreign Officials (Ukraine) Regulations listed under Schedule 1. The Regulations are available at:http://www.international.gc.ca/sanctions/ukraine_developments-developpements_ukraine.aspx?lang=eng
A lot more succinct than the FinCEN one, to be sure.
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