In arguably one of the most high-profile individual Foreign Corrupt Practices Act enforcement actions in recent years, the DOJ announced yesterday that Low Taek Jho (Jho Low), Ng Chong Hwa (Roger Ng – a former managing director at Goldman Sachs), and Tim Leissner (the former Southeast Asia Chairman at Goldman Sach and Participating Manager Director) were charged with FCPA offenses for paying bribes to various Malaysian and Abu Dhabi officials in connection with 1Malaysia Development Berhad (1MDB), Malaysia’s state-owned and state-controlled investment development company. The individuals were also charged with conspiring to launder billions of dollars embezzled from 1MDB.
Robert Bruce, a former Director and Chair of the Audit Committee of China North East Petroleum, is not the only individual to have recently made a noisy exit (see here for the prior post at the FCPA Blog).
In an explosive complaint (see here) recently filed in U.S. District Court for the Eastern District of Michigan (Southern Division), Barker (a former pilot in the U.S. Marine Corps and Gulf War veteran as well as State Department official) alleges as follows:
“When Barker tried to put a stop to the kickbacks, bribery, accounting fraud and corruption at TAQA, the Defendants [TAQA, TAQA New World, […] (a NY licensed attorney and chief attorney for and General Counsel of TAQA] fired him. Instead of abiding by the terms of Barker’s employment contract, they summoned him to a meeting and presented him with a so-called ‘severance agreement,’ a one-sided agreement in which Barker purportedly agreed to step down as CEO and forfeit millions of dollars owed to him. Defendant […], a New York-licensed attorney, chief attorney for and General Counsel of TAQA, demanded that he sign the ‘severance agreement’ on the spot, comply with its provisions, or be arrested and sent to prison. Worried for his life and the well-being of his family, Barker signed the ‘severance agreement.’ Thereafter, he was harassed and lived in fear of a ‘knock’ on the door by police, received mysterious phone calls and was followed, until finally he and his family escaped to the safety of the United States.”
According to the complaint, 75% of TAQA’s stock is owned by the Abu Dhabi Ruling Family and 25% is owned by investors and is publicly-traded on the Abu Dhabi Stock Exchange. The complaint asserts that TAQA has offices in North America, including in Ann Arbor, Michigan, and that TAQA does business by and through various subsidiaries including TAQA New World Inc., a Delaware corporation based in Ann Arbor.
In terms of the Foreign Corrupt Practices Act, TAQA New World is a “domestic concern.” The complaint also asserts that TAQA “conducts several of its global business functions out of its Ann Arbor office including: human resources; accounting; tax management; and regulatory affairs.”
While Barker’s complaint does not appear to directly implicate the FCPA, given his general allegations, this case may draw DOJ interest.