Across The Pond
The United Kingdom Serious Fraud Office (SFO) announced an enforcement action against Ultra Electronics Holdings Ltd (a British manufacturer of electronic systems for the international defence and aerospace market) in connection with bribery schemes in Oman and Algeria.
As stated in the SFO release, the company “acknowledged accountability for failure to prevent bribery” and a judge “approved a Deferred Prosecution Agreement (DPA) requiring [the company] to pay the penalty, plus £4.8 million in SFO investigation costs. In addition to the financial penalty and costs, the DPA requires the company to meet strict conditions and demonstrate genuine and sustained reform under the scrutiny of the court.”
Balt Resolves $1.2 Million FCPA Enforcement Action
Earlier this month, the DOJ filed criminal charges against David Ferrera and Marc Tilman in connection with an alleged bribery scheme involving an alleged “foreign official” at Centre Hospitalier Universitaire de Reims, an alleged French state-owned and state-controlled public university hospital. (See here for the prior post).
Today, the DOJ returned to the same core allegations in announcing a $1.2 million Foreign Corrupt Practices Act enforcement action against Balt SAS (a medical device company headquartered in France). As stated in the DOJ release, Ferrera was an executive at Balt’s U.S. subsidiary and Tillman was hired by Balt’s U.S. subsidiary as a consultant.
Balt joins approximately 35 other companies not to contest the dubious FCPA enforcement theory that employees of certain foreign health care systems are “foreign officials” under the FCPA and thus occupy a status akin to a President or Prime Minister.
Time will tell if Ferrera and/or Tillman contest this enforcement theory as the previous post noted that the matter is believed to be the first DOJ individual FCPA enforcement action based on this theory.
DOJ Charges Individual In Connection With Alleged PEMEX Bribery Scheme
Earlier this week in the S.D. of Texas, this DOJ filed a criminal information against Alfonso Wilson alleging that he and others obtained and retained a December 2021 Contract with PEMEX for an Equipment Company through corrupt and fraudulent means, including by offering and paying bribes to a Foreign Official.
Wilson is described was a dual citizen of the United States and Mexico and a resident who owned and controlled an Intermediary Company and who had responsibilities for liaising with Foreign Official as an agent of Equipment Company in connection with obtaining the December 2021 Contract for Equipment Company.
According to this LinkedIn profile, Al Wilson is the Chief Executive Officer at Oil Technologies Consortium. Wilson’s LinkedIn profile indicates that between 1994 and 2006 he worked at PEMEX.
The Equipment Company (described as a company based in Texas) is believed to be Drillmec.
The Foreign Official is described as a senior executive at PEMEX Exploración y Producción (“PEP” – a wholly owned exploration and production subsidiary of PEMEX) between 2018 and 2021.
Notable Criminal FCPA Enforcement Action Filed
It is one of the more dubious FCPA enforcement theories there is.
It has never been subjected to judicial scrutiny.
It is a relatively new enforcement theory when one considers that the Foreign Corrupt Practices Act was enacted in 1977.
It is an enforcement theory that has been used 35 times in corporate enforcement actions since introduced to the FCPA context in 2002 and thus is one of the more obvious reasons for the general increase in FCPA enforcement in the modern era. (See here).
It is the enforcement theory that employees (such as physicians, nurses, mid-wives, lab personnel, etc.) of certain foreign health care systems are “foreign officials” under the FCPA and thus occupy a status akin to a President or Prime Minister.
It is believed that this enforcement theory has never been used to criminally charge an individual with FCPA offenses …. until now.