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Friday Roundup


Looking for talent – got talent, FBI announcement, Bourke related, to FCPA Inc., and for the reading stack.  It’s all here in the Friday Roundup.

Looking for FCPA Talent?  Got Talent

If your firm or organization is looking for either a summer associate or full-time lawyer with a solid foundation in the FCPA, FCPA enforcement, and FCPA compliance, please e-mail me at I teach one of the only FCPA specific law school classes in the country (see here) and my Southern Illinois University law students who excelled in the class have, I am confident in saying, more practical skills and knowledge on FCPA topics than other law students.

I can recommend several students and I encourage you to give them an opportunity.

FBI Announcement

The FBI recently announced the establishment of international corruption squads.  In pertinent part, the release states:

“The FCPA … makes it illegal for U.S. companies, U.S. persons, and foreign corporations with certain U.S. ties to bribe foreign officials to obtain or retain business overseas. And we take these crimes very seriously—foreign bribery has the ability to impact U.S. financial markets, economic growth, and national security. It also breaks down the international free market system by promoting anti-competitive behavior and, ultimately, makes consumers pay more.

We’re seeing that foreign bribery incidents are increasingly tied to a type of government corruption known as kleptocracy, which is when foreign officials steal from their own government treasuries at the expense of their citizens. And that’s basically what these foreign officials are doing when they accept bribes in their official capability for personal gain, sometimes using the U.S. banking system to hide and/or launder their criminal proceeds.

The FBI—in conjunction with the Department of Justice’s (DOJ) Fraud Section—recently announced another weapon in the battle against foreign bribery and kleptocracy-related criminal activity: the establishment of three dedicated international corruption squads, based in New York City, Los Angeles, and Washington, D.C.

Special Agent George McEachern, who heads up our International Corruption Unit at FBI Headquarters, explains that the squads were created to address the national and international implications of corruption. “The FCPA allows us to target the supply side of corruption—the entities giving the bribes,” he said. “Kleptocracy cases allow us to address the demand side—the corrupt officials and their illicit financial assets. By placing both threats under one squad, we anticipate that an investigation into one of these criminal activities could potentially generate an investigation into the other.”

Corruption cases in general are tough to investigate because much of the actual criminal activity is hidden from view. But international corruption cases are even tougher because the criminal activity usually takes place outside of the U.S. However, members of these three squads—agents, analysts, and other professional staff—have a great deal of experience investigating white-collar crimes and, in particular, following the money trail in these crimes. And they’ll have at their disposal a number of investigative tools the Bureau uses so successfully in other areas—like financial analysis, court-authorized wiretaps, undercover operations, informants, and sources.

Partnerships with our overseas law enforcement counterparts—facilitated by our network of legal attaché offices situated strategically around the world—are an important part of our investigative arsenal. The FBI also takes part in a number of international working groups, including the Foreign Bribery Task Force, to share information with our partners and help strengthen investigative efforts everywhere. And we coordinate with DOJ’s Fraud Section—which criminally prosecutes FCPA violators—and the Securities and Exchange Commission—which uses civil actions to go after U.S. companies engaging in foreign bribery.

Our new squads will help keep the Bureau at the forefront of U.S. and global law enforcement efforts to battle international corruption and kleptocracy.”

Bourke Related

This October 2013 post highlighted a Democracy Now program that attempted to re-script the Frederic Bourke FCPA enforcement action.

Democracy Now returns to the story in this recent interview with former U.S. Senator George Mitchell.  Mitchell, like Bourke, invested in the Azeri project at issue, but unlike Bourke was not prosecuted.

Set forth below is the Q&A:

Democracy Now: Do you believe [Bourke] is a whistleblower, and do you believe that he should be exonerated.

Mitchell: Well, I believe that he should not have been convicted in the trial, in which conviction did occur. I think it was a very unfortunate circumstance, and as you describe it, regrettable from Rick Bourke’s standpoint.

Democracy Now: Do you believe he should now be exonerated, to be able to clear his name fully?

Mitchell: Well, yes, but I’m not sure what process would occur. He was tried, convicted. The conviction was upheld on appeal. But, as I said, I repeat, I do not believe he should have been convicted in the first place.

As noted in the prior post, while each is entitled to his/her own opinion about the Bourke case, the fact is – the case received more judicial scrutiny than arguably any other FCPA enforcement action.

To FCPA Inc.

It happens so often it is difficult to keep track of, but I try my best.

In the latest example of a DOJ FCPA enforcement attorney departing for FCPA Inc., Sidley Austin recently announced that James Cole (former DOJ Deputy Attorney General) ” has joined the firm in Washington, D.C. as a partner in its White Collar: Government Litigation & Investigations practice.”  As stated in the release, ““[Cole’s] experience at the highest levels of law enforcement will enable him to counsel our clients facing the most difficult and complex challenges.”  Cole’s law firm bio states that he will focus “his practice on the full range of federal enforcement and internal investigation matters, with a particular emphasis on cross-border and multi-jurisdictional matters.”

While at the DOJ, Cole frequently articulated DOJ FCPA positions and enforcement policies.  (See here for example).

For the Reading Stack

From Professor Peter Henning in his New York Times Dealbook column – “Lawmakers Focus on How the SEC Does Its Job.”

From Miller & Chevalier attorneys – “DOJ is Losing the Battle to Prosecute Foreign Executives.”  An informative article regarding the DOJ’s struggles to prosecute foreign nationals for a variety of offenses (antitrust, FCPA, etc.).

An informative article here in the New York Law Journal by Marcus Asner and Daniel Ostrow  titled “A New Focus On Victims’ Rights in FCPA Restitution Cases.”

An interesting read here from the Wall Street Journal regarding China National Cereals, Oils and Foodstuffs Corp (Cotfco), a state-owned enterprise.

“In a few short years, Cofco has spent a couple billion dollars quietly buying up Australian cane fields, French vineyards and soybean pastures in Brazil, helping it become one of the world’s largest food companies. Now, Cofco is exploring deals in the world’s biggest exporter of agricultural commodities: the U.S.”

Weekend assignment:  are Cofco employees Chinese “foreign officials” under the 11th Circuit’s Esquenazi decision?


A good weekend to all and “On Wisconsin.”

How Should the District Court in Siriwan Interpret Thailand’s Response to the US Government’s Extradition Request?

Today’s post is from Mike Dearington, a third-year law student at Vanderbilt University Law School.  The post concerns the DOJ’s FCPA-related enforcement action against the “foreign officials” in the Gerald and Patricia Green enforcement action. Dearington previously authored guests posts here and here on the action and provides an update below.


How Should the District Court in Siriwan Interpret Thailand’s Response to the US Government’s Extradition Request?

Prosecutors in United States v. Siriwan filed a response last week (here) to address arguments raised by the Siriwans in mid-January.  Arguing against dismissal, prosecutors advanced the government’s position that Thailand’s responses to the US extradition request indicate that “Thailand has not asserted sole jurisdiction” over the Siriwans.

To recap, the Siriwan case has garnered significant attention because of the government’s novel prosecution tactic:  In 2009, prosecutors charged Juthamas Siriwan, ex-Governor of Tourism Authority of Thailand, as well as her daughter Jittisopa, with money laundering in connection with alleged bribe receipts remitted by Gerald and Patricia Green (see here for the prior FCPA Professor post).  The FCPA cannot reach Juthamas Siriwan because she is a foreign official, a limitation pronounced in United States v. Castle.  Thus, prosecutors charged Siriwan with money laundering in promotion of bribery in hopes of avoiding the FCPA’s shortcoming—a tactic the defense deemed a “novel and untested . . . theory.”

But prosecutors face a hurdle in what Judge Wu has called “a very important case in an area which is very, very difficult.”  Indeed, in a January 2012 hearing on the defendants’ motion to dismiss, Judge Wu expressed reluctance with “the government’s position that [it] can somehow get around” the FCPA by charging defendants under the Money Laundering Control Act (MLCA).  But an additional hurdle stands in the way of the court even reaching this money-laundering issue.

That hurdle is the United States’ treaty with Thailand.  In the January 2012 hearing, Judge Wu stated:

“I would not feel comfortable reaching final conclusions until I figure out or unless I am informed how the government of Thailand is viewing the situation . . . .  [I]f Thailand says it’s not going to extradite, I will find that Thailand has a dominant interest . . . because they will have expressed it to me in no uncertain terms.  If they agree to the extradition, then all of the issues are open and that means I’ll have to decide them all.”

In sum, the court suggested it might not reach a decision on whether prosecutors can proceed under an MLCA theory until the court first decides whether Thailand has a dominant interest or not.

To complicate matters, Thailand has neither agreed to, nor rejected, the government’s extradition request.  By July 2012, Thailand had made no response to US overtures. Finally, in November 2012, the Acting Thai Attorney General notified prosecutors that it was gathering evidence to charge the Siriwans and “must postpone the extradition process” pursuant to the treaty.  And in December 2012, Thailand’s Ministry of Foreign Affairs informed the US Embassy that a “criminal case will be filed” against Siriwan and therefore extradition proceedings “must be postponed . . . .”

Thus, the determinative question at this stage is how the court will interpret Thailand’s response.  On one hand, based on the court’s statements in January 2012, if the court views Thailand’s response and postponement of extradition proceedings as an expression of sole jurisdiction and a refusal to extradite, it will probably dismiss the indictment finding that Thailand has a dominant interest.  In support of dismissal, the defense argued in January that Thailand has expressed “sovereign interest,” and that Thailand’s position and “official[]” postponement “suggest[] the Thai government feels that extradition and prosecution here ‘may affect the international relation.’”

On the other hand, if the court views Thailand’s response not as a refusal, but as a mere delay, the case will likely remain on the court’s docket at least until the Thai Attorney General’s Office concludes its investigation and prosecution.  In the government’s filing last week, prosecutors argued that Thailand has “not made any . . . notification . . . nor has it otherwise signaled that international relations may be impaired . . . by the government’s prosecution.”  Of Thailand’s position, prosecutors stated “Thailand asserts no definitive position on any aspect of the government’s extradition request. . . . Thailand’s only affirmative statement is that it is postponing review of the request for the time being.”  Prosecutors accused the defense of “tr[ying] again and again to invent and interject into this case a conflict with Thailand that, in fact, does not exist,” and also of “inappropriately asserting self-serving and unfounded claims on behalf of Thailand.”

The court will need to first decide the jurisdiction question before even reaching, if at all, the legitimacy of prosecutors’ MLCA theory.  Even if the court ultimately approves the theory, however, the Siriwan proceeding portends the delays and difficulties treaties might pose for the government in seeking to prosecute foreign officials in the future.  A hearing on these issues is scheduled for February 21.

Prosecutors Stymied By Thai Attorney General’s Office In Siriwan Case

This post is from Mike Dearington (a third-year law student at Vanderbilt University Law School) who discusses the DOJ’s FCPA-related enforcement action against the “foreign officials” in the Gerald and Patricia Green enforcement action.  Dearington previously authored this guest post on the action and provides an update below.


Prosecutors Stymied by Thai Attorney General’s Office in Siriwan Case

Mike Dearington

Take a break from digesting the recently released FCPA guidance to read about happenings in a more remote region of the FCPA world.  For the second time since July, the court in United States v. Siriwan has asked the DOJ to show its cards with respect to its extradition request to Thailand.

Siriwan involves charges that Juthamas Siriwan, ex-governor of Tourism Authority of Thailand, and her daughter, Jittisopa, accepted bribes from Hollywood movie executives Gerald and Patricia Green in exchange for contracts.  Prosecutors face a substantial hurdle in convincing the court that their novel use of the money‑laundering statute (MLCA) to prosecute the Siriwans is permissible even when the defendants are foreign officials otherwise outside the reach of the FCPA.  But based on a November 15 filing (here), prosecutors apparently face a separate hurdle in convincing the court to even reach the merits.  This is because, despite the government’s request, Thailand appears unprepared to extradite the Siriwans.

In July, the government reluctantly revealed that it had “not yet received a response from Thailand regarding extradition.”  The government has finally received its response.  Prosecutors filed a status report this past Thursday updating the court about the government’s struggle to obtain extradition from the Kingdom of Thailand.  Appended to the government’s status report is a translated letter from Thavorn Panichpant, Acting Thai Attorney General, stating that Thailand is “in the process of gathering further evidences [sic] before completing the investigation in order to bring both offenders to court to be formally charged. Hence, we must postpone the extradition of both [defendants] as requested by the U.S. Government, according to the Extradition Act . . . .”

The government has interpreted “postpone” as an indication that Thailand may be willing to ultimately extradite the Siriwans.  Prosecutors appended a letter from the US Office of Law Enforcement and Intelligence, a unit of the Department of State’s Office of the Legal Adviser, interpreting the Thai Acting Attorney General’s letter, “not as a rejection, nor an assertion of jurisdiction over this matter . . . .”  And in its brief, the prosecution argued that Thailand’s response “does not constitute a denial of the government’s extradition request.”  Nonetheless, it appears that Thailand’s response poses serious problems for prosecutors.

First, after reading the letter, the court may decline to exercise jurisdiction over the Siriwans in consideration of “the comity of nations.”  In Hilton v. Guyot, the Supreme Court in 1895 described comity, not as “a matter of absolute obligation . . . nor of mere courtesy and good will,” but rather as a “recognition which one nation allows within its territory to the legislative, executive or judicial acts of another nation . . . .”

Second, the court may decline to exercise jurisdiction based on the international-law principle of “reasonableness.”  Section 403 of The Restatement (Third) of Foreign Relations suggests, “[A] state may not exercise jurisdiction to prescribe law with respect to a person or activity having connections with another state when the exercise of such jurisdiction is unreasonable.”  One of The Restatement’s reasonableness factors is “the extent to which another state may have an interest in regulating the activity,” a factor that weighs heavily in the Siriwans’ favor since the Thai Attorney General’s Office has expressed an interest in prosecuting the Siriwans domestically.

If the court decides to dismiss the action, it will probably operate as a dismissal with prejudice, even if dismissed without prejudice.  The statute of limitations for money laundering under § 1956 is five years, and the most recent act of money laundering allegedly occurred in March 2006.  Although the Ninth Circuit has yet to rule on the issue, courts in the Central District of California have typically held that, absent a savings clause, a statute of limitations continues to run despite a dismissal without prejudice, as if the original complaint had never been filed.  See, e.g., Sperling v. White (C.D. Cal. 1998). 

The letter from the Thai Attorney General’s Office could have a substantial impact on the DOJ’s efforts to curb foreign bribery.  If the court decides to dismiss the action, not only will prosecutors lose the opportunity to prosecute the Siriwans, but the DOJ will also lose the opportunity to test its novel prosecution theory that would allow it to hold foreign officials accountable for bribery via the money-laundering statute.  If the court dismisses the action, we can expect prosecutors to appeal such a dismissal as a final order.

U.S. v. Siriwan Filing Sheds Light On Extradition Relations With Thailand In Pivotal Justice Department Case

Today’s post is from Mike Dearington, a rising 3L at Vanderbilt Law School and FCPA Professor reader.


U.S. v. Siriwan Filing Sheds Light on Extradition Relations with Thailand in Pivotal Justice Department Case

Prosecutors in United States v. Siriwan submitted an extradition status report (here) last Friday in the Central District of California, revealing a potentially strained diplomatic relationship between officials in the U.S. and the Thai Attorney General’s office.  Prosecutors charged Juthamas Siriwan, ex-governor of Tourism Authority of Thailand, and her daughter, Jittisopa, in 2009 with accepting bribes from Hollywood movie executives Gerald and Patricia Green in exchange for lucrative contracts.  (See here for the previous FCPA Professor post.)  The Greens were convicted in 2010 and sentenced to six months imprisonment.  (See here for the previous post.)

In the DOJ’s filing, prosecutors expressed discomfort with providing an extradition-status update pursuant to court order, which they noted was “highly unusual in a public setting and strongly discouraged for many policy and case specific reasons.”  One of these reasons, no doubt, was that the status update forced prosecutors to admit that the U.S. “has not yet received a response from Thailand regarding extradition.”

The Siriwan case is interesting also because it could be instrumental to DOJ efforts to curb foreign bribery, as it is an example of prosecutors uniquely targeting a “foreign official.”  One of the oft-cited shortcomings of the FCPA is that it is purely a “supply side” enforcement scheme.  In other words, the FCPA targets only those paying bribes, and does not prohibit receipt of such bribes by the foreign officials who demand them.

Indeed, critics have declared that, by targeting only the supply side, the law fails to appreciate the nature of foreign bribery.  Bribery is not economically beneficial to corporations because of the risks and costs, yet corporate representatives nonetheless often pay bribes because they are economically extorted by foreign officials.  Officials like Siriwan have been known to set the bidding process and are often first to broach the subject because of their powerful bargaining positions.  Although the FCPA prohibits only bribe payments—and not receipts—the Siriwan case is somewhat of a DOJ workaround.

In Siriwan, prosecutors did not charge FCPA violations, as the Siriwans made no bribery payments.  But prosecutors did charge substantive money-laundering.  The Money Laundering Control Act (MLCA) prohibits the conveyance of funds to or from the U.S. “with the intent to promote the carrying on of specified unlawful activity.”  Just what unlawful activity qualifies is an open question here.

Prosecutors argue that the Greens’ bribe payments represent specified unlawful activity, as do the Siriwans’ violations of Thai laws.  On the other hand, the Siriwans contend the money-laundering charges are pulling “double duty” and that one cannot promote illegal payments by receiving illegal payments.  The Siriwans’ motion to dismiss (see here for the prior post) has been pending since August 2011.

Siriwan may determine whether money-laundering is a viable tactic in the DOJ’s efforts to curb foreign bribery.  The DOJ has expressed an interest in demand-side prosecutions.  In 2009, prosecutors charged Robert Antoine and Jean Rene Duperval, formerly of Haiti Teleco, a state-owned national telecommunications company, with money laundering after each allegedly accepted bribes.  (See here for the prior post.)  Antoine pled guilty and was sentenced to four years in prison; Duperval was convicted and sentenced to nine years in prison in May 2012.

If prosecutors prevail in Siriwan, we can expect the DOJ to pursue a greater number of foreign officials under the MLCA, reminiscent of the way prosecutors pursued foreign executives in the 1990s/2000s under U.S. Antitrust laws due to a lag in foreign anti-trust enforcement.  If U.S. prosecutors can bring foreign officials within their purview, the DOJ may have more tools to reign in foreign bribery.

The Elusive Mr. Kozeny

Today’s post is from Brian Whisler (here – a former federal prosecutor and current partner at Baker & McKenzie).


On March 28, 2012, the Bahamian Privy Council dismissed the U.S. Justice Department’s appeal of the lower court’s decision on jurisdictional grounds, largely though not entirely foreclosing the U.S. effort to extradite Victor Kozeny to stand trial and defend against FCPA/money laundering charges pending in the Southern District of New York.  (See here for the 2005 indictment).   The Privy Council’s opinion (here) reflects some unfavorable comments on the merits of the Justice Department’s extradition case, but did provide some leave for the U.S. to renew its extradition attempt. For now, Kozeny is free to remain in the Bahamas, but faces a pending extradition request from the Czech Republic (relative to defrauded investors), which was awaiting the outcome of the U.S. extradition request.

Whether the Justice Department will continue to pursue Kozeny after seven years of effort remains an open question. As the sentencings of the co-defendants in the Bourke/Kozeny matter (Bodmer, Farrell, and Lewis) have been deferred since 2005 pending extradition of Kozeny, there may be some pressure to dismiss against Kozeny and bring closure to the co-defendants’ cases.

The Kozeny quest illustrates the challenge associated with charging foreign nationals in FCPA cases (and criminal cases generally).  In the event that the U.S. authorities elect to dismiss against Kozeny, they may perhaps take some comfort knowing that Kozeny served 19 months in pre-trial detention in a Bahamian prison, while co-defendant Frederick Bourke was sentenced (though yet to serve) only 12 months, one day for his role in the conspiracy. It has also been reported that Kozeny has spent in excess of $1 million in legal fees fighting extradition to the United States.

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