Yesterday, the DOJ quitely posted to its FCPA website this “declination with disgorgement” letter  concerning Insurance Corporation of Barbados Limited (ICBL).
Pursuant to the agreement, ICBL agreed to pay approximately $94,000 to the U.S. for alleged bribes to a Barbadian government official in exchange for insurance contracts.
The full text of the DOJ’s letter to ICBL’s counsel (Adam Siegel – Freshfields Bruckhaus Deringer) is as follows.
“Consistent with the FCPA Corporate Enforcement Policy, the Department of Justice, Criminal Division, Fraud Section and the United States Attomey’s Office for the Eastem District of New York (collectively, the “Department”) is closing its investigation of your client, Insurance Corporation of Barbados Limited (“ICBL”), an insurance company incorporated and headquartered in Barbados, concerning violations of the Foreign Corrupt Practices Act.
The Department’s investigation found that ICBL, through its employees and agents, paid approximately $36,000 in bribes to a Barbadian government official in exchange for insurance contracts resulting in approximately $686,827.50 in total premiums for the contracts and approximately $93,940.19 in net profits. Specifically, in or around August 2015 and April 2016, high-level employees of ICBL took part in a scheme to pay approximately $36,000 in bribes to Donville Inniss and to launder the bribe payments into the United States. At the time, Inniss was a member of the Parliament of Barbados and the Minister of Industry, International Business, Commerce, and Small Business Development of Barbados. In exchange for the bribes from the ICBL employees, Inniss leveraged his position as the Minister of Industry to enable the Barbadian insurance company to obtain two government contracts. To conceal the bribes, Inniss, who is a U.S. legal permanent resident and maintains a residence in the United States, arranged to receive them through a U.S. bank account in the name of a dental company that was located in Elmont, New York, and owned by his friend who is a U.S. citizen. Inniss’ friend then assisted Inniss in further transferring portions of the bribes from the dental company bank account in New York to a bank account in the name of Inniss that was located in Tampa, Florida.
Despite the high-level involvement of corporate officers in the misconduct, the Department has decided to close its investigation of this matter based on a number of factors, including but not limited to: (l) ICBL’s timely, voluntary self-disclosure of the matters described above; (2) ICBL’s thorough and comprehensive investigation; (3) ICBL’s cooperation in this matter (including its provision of all known relevant facts about the misconduct) and its agreement to continue to cooperate in the Department’s ongoing investigations and/or prosecutions; (4) ICBL’s agreement to disgorge to the Department all profits it made from the illegal conduct; (5) the steps ICBL has taken to enhance its compliance program and its internal accounting controls; (6) ICBL’s remediation, including but not limited to terminating all of the executives and employees who were involved in the misconduct and (7) the fact that the Department has been able to identify and charge the culpable individuals.
Pursuant to this letter agreement, ICBL agrees to disgorge $93,940.19 USD (the “Disgorgement Amount”), which represents the profit to ICBL from the illegally obtained contracts in Barbados. ICBL shall pay the Disgorgement Amount to the United States Treasury within ten ( 10) business days of its execution of this letter. ICBL acknowledges that no tax deduction may be sought in connection with any part of its payment of the Disgorgement Amount. ICBL further agrees that it will not seek or accept directly or indirectly reimbursement or indemnification from any source with regard to the Disgorgement Amount.
This letter agreement does not provide any protection against prosecution of any individuals, regardless of their affiliation with ICBL. If the Department leams information that changes its assessment of any of the factors outlined above, it may reopen its inquiry.”
In FCPA speak, ICBL is a “person other than an issuer or domestic concern” and thus can only be subject to the FCPA’s anti-bribery provisions under the so-called dd-3 prong of the statute. This portion of the FCPA has the most demanding jurisdictional element found in the FCPA that being “while in the territory of the United States, corruptly to make use of the mails or any means or instrumentality of interstate commerce or to do any other act in furtherance of an” improper payment scheme.” (emphasis added).
There is no mention in the DOJ’s letter agreement how this required FCPA element was met regarding ICBL and as highlighted in this recent post  payment of alleged bribes through U.S. accounts is insufficient to satisfy dd-3’s “while in the territory of the U.S.” jurisdictional prong. For instance, in the Africa Sting case, a federal court judge rejected such an expansive jurisdictional theory as applied to a foreign national (see here ) and recently the U.S. Supreme Court questioned such expansive jurisdictional theories as applied to foreign companies. (See here ).
Earlier this month, Inniss was criminally charged by the DOJ with conspiracy to launder money and money laundering. (See here ).
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