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Friday Roundup

Never mind that …, “foreign official” charges, scrutiny alert, ISO-37001 related, and ethics inquiry up north. It’s all here in the Friday roundup.

Never Mind That …

Never mind that Cobalt International – not once, but twice – beat back the government in connection with FCPA scrutiny in Angola (see prior posts here [1] and here [2] as well as this podcast [3]).

Nevertheless, a federal court judge recently approved an approximate $175 million settlement of investor class action claims alleging various securities laws violations by Cobalt related to its FCPA scrutiny (see here [4]). As to the plaintiffs’ lawyers, well they get 25% of that amount plus approximately $2 million in reimbursement of litigation expenses.

“Foreign Official” Charges

This recent post [5] highlighted the DOJ’s FCPA (and related) enforcement action against Frank James Lyon (the owner of Lyon Associates Inc. – a privately-held engineering and consulting company headquartered in Hawaii) in which he pleaded guilty to conspiracy to violate the FCPA (based on things of value provided to officials in the Federated States of Micronesia – FSM) as well as paying bribes to an agent of an organization receiving federal funds (based on things of value provided to officials with a Hawaii governmental agency – State Agency).

Earlier this week, the DOJ announced [6] that Master Halbert, the alleged Micronesian official, was criminally charged with conspiracy to commit money laundering.

Scrutiny Alert

Caliburn Int’l

In 2011, Caliburn International Corp. acquired Sallyport Global Holdings, Inc. (“Sallyport”). Caliburn recently filed a registration statement to publicly offer securities and disclosed [7]:

“In October 2016, an individual purporting to work in the Iraqi Ministry of Defense alleged in an unsolicited telephone call to Sallyport that Afaq [Afaq Umm Qasr Marine Services Company (“Afaq”), Sallyport’s partner on several U.S. Air Force contracts at several bases in Iraq, including the Balad Air Base] using its share of net profits, promised to pay Iraqi government officials in exchange for those officials naming Sallyport as a provider of services at the Balad Air Base under the Balad Construction Contract and the Balad Base Support Contract awarded in 2014.

In November 2016, Sallyport voluntarily disclosed to the US Department of Justice (“DOJ”) a potential violation of the Foreign Corrupt Practices Act (“FCPA”) and potentially other U.S. laws related to Sallyport’s relationship with Afaq. The USAF awarded Sallyport two such FMS contracts in early 2014 for work at Balad Air Base, Iraq. Afaq was also a subcontractor to the Company in separate subcontracts in Iraq unrelated to Balad.

Sallyport has engaged outside counsel and has cooperated, and continues to cooperate, with the DOJ’s investigation, which also considers whether Sallyport’s former management knew, or should have known, of the alleged promise of payments by Afaq to Iraqi government officials. The former management that negotiated and reviewed the Afaq MOU denies any such knowledge. At this point, we are unable to determine the likely outcome of the investigation.”

Vitol

Reuter reports [8]:

“The FBI is investigating energy trading firm Vitol’s top two executives in the Americas in connection with a Brazil bribery case … […]

Miguel “Mike” Loya, Vitol’s U.S. head, and Antonio Maarraoui, the company’s head for Latin American and the Caribbean, are under investigation by the U.S. law enforcement agency.”

[9]

ISO 37001

This recent FCPA Blog post [10] is titled “Three Predictions for the Future of ISO 37001” and sets forth the predictions of accredited certifying bodies that are performing ISO 37001 anti-bribery management systems audits.

This is too funny and strikes me as being similar to asking barbers to make predictions about the future and value of getting a haircut.

Ethics Inquiry

This recent post [11] highlighted questions swirling in Canada concerning alleged interference by the Prime Minister’s office in connection with SNC-Lavalin’s long-standing scrutiny.

As reported here [12]:

“Canada’s parliamentary ethics commissioner said … that he would look into allegations that Prime Minister Justin Trudeau improperly pressured his former attorney general to call off a criminal case against a major engineering company based in Montreal. The announcement, made in a letter to two members of Parliament, followed several days of allegations that Mr. Trudeau, or members of his staff, improperly tried to force a settlement of charges that the company, SNC-Lavalin, paid million of dollars in bribes to officials in Libya when the country was ruled by Col. Muammar el-Qaddafi.”

Elevate Your FCPA Research

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Elevate Your Research [13]