- FCPA Professor - http://fcpaprofessor.com -

The Case That Just Keeps On Giving

Last week, the Haiti Teleco case netted additional defendants as the DOJ announced (here [1]) a superseding indictment in the never-ending enforcement action. Named in the superseding indictment (here [2]) are:

Cinergy Telecommunications Inc. (a privately-held telecommunications company incorporated in Florida, charged with one count of conspiracy to violate the FCPA and to commit wire fraud, six counts of FCPA violations, one count of conspiracy to commit money laundering and 19 counts of money laundering);

Washington Vasconez Cruz (the president of Cinergy, charged with one count of conspiracy to violate the FCPA and to commit wire fraud, six counts of FCPA violations, one count of conspiracy to commit money laundering and 19 counts of money laundering);

Amadeus Richers (a former director of Cinergy, charged with one count of conspiracy to violate the FCPA and to commit wire fraud, six counts of FCPA violations, one count of conspiracy to commit money laundering and 19 counts of money laundering);

Patrick Joseph (a former general director for telecommunications at Haiti Teleco and thus a “foreign official” according to the DOJ, charged with one count of conspiracy to commit money laundering);

Jean Rene Duperval (a former director of international relations for telecommunications at Haiti Teleco and thus a “foreign official” according to the DOJ, charged with two counts of conspiracy to commit money laundering and 19 counts of money laundering); and

Marguerite Grandison (the former president of Telecom Consulting Services Corp., and Duperval’s sister, charged with two counts of conspiracy to commit money laundering and 19 counts of money laundering.

Duperval and Grandison were previously charged in the case in December 2009 (see here [3]).

With this latest development, the Haiti Teleco case has become, other than the manufactured Africa Sting enforcement action, the largest FCPA enforcement action in history – in terms of number of defendants – 12. In addition to those listed above, the following individuals were also charged: Antonio Perez, Joel Esquenazi, Juan Diaz, Robert Antoine, Jean Fourcand, and Carlos Rodriguez.

The Haiti Teleco case stands in stark contrast to many corporate FCPA enforcement actions (enforcement actions that sometimes involve tens or hundreds of millions of dollars in bribe payments) that yield no individual enforcement actions. See here [4] for the prior post discussing the numbers from 2010 and thus far this year.

All bribery and corruption of course is bad, but does approximately $1 million in alleged bribe payments in the Haiti Teleco case justify the largest real FCPA enforcement action in history?

I previously observed (here [5]) in connection with the Haiti Teleco case that often the DOJ resolves seemingly clear-cut instances of corporate bribery and corruption involving tens or hundreds of millions of dollars in bribe payments (per the government’s own evidence) without FCPA anti-bribery charges and without charging any corporate employees. In other cases, often relatively minor ones, the DOJ comes out with guns-a-blazing.

To call it inconsistent law enforcement is an understatement.