Federal Bureau of Investigation arrests 22 in bribery sting operation.
The Federal Bureau of Investigation (FBI) agents have arrested 22 people working in the arms and security industries in a massive sting operation, charging them with trying to bribe an African defense minister, U.S. officials said January 19. In the biggest operation ever of its kind, the 22--including at least three British nationals--were held under the Foreign Corrupt Practices Act (FCPA), the Department of Justice said. The detainees--21 arrested January 18 in Las Vegas, Nevada, the other in Miami--are charged with trying to obtain a $15 million contract in an African nation to outfit the presidential guard.
This ongoing investigation is the first large-scale use of undercover law enforcement techniques to uncover FCPA violations, Assistant Attorney General Lanny Breuer said. The fight to erase foreign bribery from the corporate playbook will not be won overnight, but these actions are a turning point. From now on, would-be FCPA violators should stop and ponder whether the person they are trying to bribe might really be a federal agent.
The Foreign Corrupt Practices Act bars U.S. companies and citizens from bribing foreign officials to win business. During a 2 1/2-year investigation, FBI agents pretended to be acting on behalf of the defense minister of an African country, although no such minister was involved in the operation.
The defendants allegedly agreed to pay a twenty percent "commission" to a sales agent who they thought represented the minister in order to win the contract. They were told half the "commission" would be paid to the defense minister. The sales agent was an undercover FBI agent, the Department of Justice said.
Corrupt payments to foreign officials to obtain or retain business erode public confidence in our free market system and threaten to undermine foreign governments, said Channing Phillips, U.S. Attorney for the District of Columbia.
Most of the suspects worked for U.S. military equipment manufacturers; two worked for British firms and one for an Israeli company, the department said, without naming the businesses due to the ongoing nature of the investigation. The companies manufactured such items as ammunition, body armor, firearms, rifles, and grenade launchers, as well as tactical and ballistic equipment After the indictments were revealed, 150 agents carried out searches in fourteen places across the United States.
British police in London also carried out seven search warrants.
In this era of global commerce, the FBI is committed to curbing corruption at home or overseas. Companies should prosper through honest practices, not the practice of backroom deals and bribery, FBI Assistant Director Kevin Perkins said.
Former Justice Department Fraud Chief Steven Tyrrell called the arrests "extremely significant," both in numbers--twice as many FCPA cases were brought in 2009 than in 2008--and in the nature of the investigations.
These matters involve the use of traditional undercover investigative techniques--something we have not seen much of in the past in the FCPA context, Tyrrell said.
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|Title Annotation:||SECURITY ASSISTANCE COMMUNITY|
|Date:||Jul 1, 2010|
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