Global Compliance and the FCPA: 15 Years for Bribery; UK Bribery Act; and More

The fight against global bribery and corruption just got real: in late October, former president of Terra Telecommunications Joel Esquenazi was sentenced to an unprecedented 15 years in prison for his role in the bribery of Haitian government officials in violation of the Foreign Corrupt Practices Act. 

“This sentence – the longest sentence ever imposed in an FCPA case – is a stark reminder to executives that bribing government officials to secure business advantages is a serious crime with serious consequences,” said Department of Justice Assistant Attorney General Breuer in a DOJ statement

For your reference, a roundup of recent updates regarding the Foreign Corrupt Practices Act and global compliance, from lawyers and law firms on JD Supra:

– On the Terra Telecommunications Bribery:

Former Telecommunications Executive Sentenced to 15 Years in Prison, the Longest Prison Term ever Handed Down for Violations of the FCPA (Warner Norcross & Judd – White Collar):

“At trial, the Government argued that, between November 2001 and March 2005, Messrs. Esquenazi and Rodriguez paid more than $890,000 in bribes to Haitian government officials at D’Haiti S.A.M.., the sole provider of land line telephone service in Haiti. According to the Government’s theory, the bribes were used to secure Terra advantageous business deals with the telephone company, including preferred telecommunications rates and reductions in the number of minutes Terra was billed for.” Read more»

Telecom Exec Sentenced to Record Breaking FCPA Prison Term: 15 years (Morrison & Foerster LLP):

“Joel Esquenazi, the former president of Terra Telecommunications Corp., received the longest sentence ever handed down in a Foreign Corrupt Practices Act prosecution: fifteen years in prison. His co-defendant, Carlos Rodriguez, the former Terra executive vice president, was sentenced to seven years in prison. The Judge also ordered the defendants to forfeit over $3 million.” Read more»

– On the UK Bribery Act:

First Conviction under the UK Bribery Act 2010 (Dechert LLP):

“Mr Munir Patel, acting in his capacity as an administrative clerk to a Magistrates Court, promised on 1 August 2011 an individual summonsed for a motoring offence that he (Mr Patel) could influence the course of criminal proceedings in exchange for a sum of £500. Mr Patel will be sentenced in November 2011 and faces imprisonment for a term of up to 10 years, and/or an unlimited fine.” Read more»

Enforcement of Bribery Act against Foreign Corporations a High UK Priority (Max Carr-Howard):

“The Bribery Act, which expands on the enforcement goals of the now familiar FCPA, went into effect in July 2011. It creates severe criminal penalties and focuses on commercial bribery, that is, bribery between private persons and companies. The Bribery Act does have a provision separately prohibiting bribery of foreign government officials, much like the FCPA, but it is focused on stamping out all forms of corruption, not just public corruption. Moreover, unlike the FCPA, it makes no exceptions for ‘facilitation’ payments.” Read more»

The Bribery Act and DPAs: Transparency is the Key (Thomas Fox):

“The debate now ongoing in the UK about whether Deferred Prosecution Agreements (DPA) should be a tool available to prosecutors in the Serious Fraud Office (SFO) and Crown Prosecutors is an important issue that should be well reasoned and thoroughly vetted… I believe that the UK should incorporate such a tool into those mechanisms available to the SFO and Crown Prosecutors to resolve cases brought under the Bribery Act.” Read more»

– On Compliance Issues Around the Globe:

Canada’s Corruption of Foreign Public Officials Act: Niko Resources Ltd Receives a $9.5 Million Fine For Bribery (Daniel Kiselbach):

“Niko Resources recently received a $9.5 million fine pursuant to Canada’s Corruption of Foreign Public Officials Act. This article discusses the circumstances of the case and how businesses can take due diligence steps to avoid committing an offence under the Act.” Read more»

Everything Old is New Again: Alcoa and Olympus (Thomas Fox):

“Two articles this week spoke about the continuing struggle companies have with the issue of agents and other third party representatives and the potential liability under the Foreign Corrupt Practices Act (FCPA)… Both cases present novel twists and turns that, if you told someone the facts, you would be accused of making up both stories.” Read more»

Boom Times in Brazil, Part 1: Five Corruption Issues to Look Out for in a High Opportunity / High Risk Environment (Matteson Ellis)

“When U.S. and other companies enter the Brazilian market, they should expect to encounter a sophisticated and savvy business sector. Corruption schemes are also sophisticated. Companies will likely encounter petty corruption (some surveys report that more than half of businesses in Brazil report tax collector requests for bribes). But they should also be alert for, and have a strategy to avoid, large and complex bribery schemes.” Read more»

Watts Water: Don’t Get Caught on the (FCPA) Slow Boat to China (Thomas Fox):

“… the Securities and Exchange Commission instituted a Cease and Desist Order again Watts Water Technologies, Inc. (WWT) and one of its employees, Leesen Chang (Chang). The Order was to obtain certain civil penalties and fines for conduct of WWT and Chang concerning violations of the books and records and internal control provisions of the Foreign Corrupt Practices Act for its China operations… WWT paid a fine of $200,000, agreed to disgorge profits of $2,755,815 and paid prejudgment interest of $820,791. Chang paid a fine of $25,000.” Read more»


See also:

Global Compliance and the FCPA: Money Laundering, Bribery, China, and More 

Global Compliance and FCPA: 20 Ideas from Thomas Fox for Playing by the Rules 

Compliance and Corruption Around the World: a Friday Reading List 

Compliance and Corruption in China: Foreign Bribery Provision of the PRC Criminal Law 

FCPA Analysis & Commentary: A Compliance Friday Update 

Friday Reading: Corporate Compliance Round-Up 


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