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Customs Issues In Argentina Result In FCPA Enforcement Action Against BJ Services

bj

[This post is part of a periodic series regarding “old” FCPA enforcement actions]

In 2004, the SEC brought this administrative cease and desist order against BJ Services (a Houston-based oil field services, products, and equipment company). The conduct at issue focused on the company’s Argentina subsidiary and its relationships with customs officials. As stated in the SEC’s order, there was no indication that anyone employed by BJ Services approved many of the alleged improper payments and the SEC further acknowledged that the improper payments were made in violation of BJ Services’ existing policies prohibiting payments of the kind made to the customs official.

Other interesting aspects of the enforcement include the following: (i) certain of the improper payments were facilitated by the Argentina subsidiary issuing checks “in the name of a lower’level” employee who then “cashed the checks and provided the proceeds to the customs official”; (ii) the SEC seemed to acknowledge that certain of the payments were facilitation payments under the FCPA, but nevertheless improperly booked, and thus still actionable.

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BellSouth Gets Hung Up In Latin America

bellsouth

[This post is part of a periodic series regarding “old” FCPA enforcement actions]

In 2002, the SEC announced the filing of a settled civil complaint against BellSouth Corporation charging the telecommunications company with violations of the FCPA’s books and records and internal controls provisions.

The conduct at issue focused on an indirect subsidiary in Venezuela (and BellSouth’s inability to “reconstruct the circumstances of purpose” of certain payments) and an indirect subsidiary in Nicaragua (which retained the wife of the chairman of a Nicaraguan legislative committee with oversight of telecommunications).

As frequently highlighted on these pages, the root cause of many FCPA enforcement actions are foreign trade barriers and restrictions and in this regard, as the complaint notes, Nicaraguan law prohibited foreign companies from acquiring a majority interest in Nicaraguan telecommunications companies.”

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An FCPA Enforcement Action Involving A U.S. Government Aid Program (With A Few Ironies)

CAAEF

[This post is part of a periodic series regarding “old” FCPA enforcement actions]

Yesterday’s post highlighted a number of Foreign Corrupt Practices Act enforcement actions in connection with U.S. government aid or assistance programs.

This post goes into more detail regarding the DOJ’s 2002 FCPA enforcement action against Richard Pitchford (the Vice President and Country Manager in Turkmenistan for the Central Asia American Enterprise Fund (CAAEF), an entity wholly funded by a $150 million appropriation from Congress pursuant to the Support for Eastern European Democracy Act of 1989 and the Freedom for Russia and Emerging Eurasian Democracies and Open Market Support Act of 1992).

One of the ironies with this enforcement action (there is another highlighted at the end of the post) is that prior to the enforcement action Pitchford was quoted as saying: “The potential in Central Asia is tremendous, especially in Turkmenistan because of its proximity to Turkey and the Persian Gulf. What’s missing is government political will to do the job. There’s no doubt this is a dictatorship and from top to bottom, it’s corrupt.” A short time later, Pitchford himself would be prosecuted for corruption.

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Bribery Involving World Bank Officials

world bank

[This post is part of a periodic series regarding “old” FCPA enforcement actions]

As noted in this post, one interesting aspect of the recently announced Foreign Corrupt Practices Act enforcement action against Joseph Baptiste is he previously entered into a plea agreement but does not intended to honor the plea agreement.

As highlighted below, the FCPA enforcement action against Ramendra Basu (a former World Bank official) for, among other things, alleged bribery in Kenya involved a similar dynamic and this post summarizes the enforcement action as well as a related enforcement action against Gautam Sengupta (a former World Bank Task Manager).

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You Don’t Need To Look Far For The Location Resulting In Several Individual FCPA Enforcement Actions

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This prior post highlighted the DOJ’s recently announced Foreign Corrupt Practices Act enforcement action against Joseph Baptiste for alleged bribery in Haiti.

The Baptiste enforcement action is just the latest in a long list of FCPA enforcement actions (all of the criminal actions were against individuals associated with small, privately-held companies) alleging improper business conduct in Haiti (a country located a short distance from the U.S.).

What makes this unusual is that Haiti attracts (relatively speaking compared to many other countries) little business activity by those subject to the FCPA. But then again, perhaps one of the reasons for this lack of business activity is the FCPA itself. As highlighted in this 2010 post, some called for the FCPA not to apply to doing business in Haiti arguing: “one of the best way to help Haiti” is to “pass a law stating that the FCPA does not apply to dealings in Haiti. As it stands right now, U.S. businesses are unwilling to take on this legal risk and the result is similar to an embargo. You can’t do business in Haiti without paying bribes.”

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