In Connection With Undercover Sting, DOJ Unseals Criminal Charges Against Joseph Baptiste For Alleged Haitian Bribery
Yesterday, the DOJ announced that Joseph Baptiste (pictured – a retired U.S. Army Colonel, practicing dentist, and former founder/president of a Maryland-based Haitian focused non-profit) was criminally charged “for his alleged role in a foreign bribery and money laundering scheme in connection with a planned $84 million port development project in Haiti.”
According to this FBI Agent affidavit in support of the criminal complaint, during the time period relevant to the complaint Baptiste served as the president of an entity headquartered in Maryland that purported to be a non-profit organization with the stated mission of helping the impoverished in Haiti” and further served as a member of the board of directors of Company A, an LLC organized under Delaware Law. According to the affidavit, Company A’s mission was to promote a port development project in an area of Haiti known as Moles Saint Nicolas.
For The First Time In Six Years, The DOJ Prevails In A Contested FCPA Proceeding When Put To Its Ultimate Burden Of Proof
Last week, for the first time in six years, the DOJ prevailed in a contest FCPA proceeding when put to its burden of proof.
As highlighted in this DOJ release, after a four week trial a federal jury convicted Ng Lap Seng of two counts of violating the Foreign Corrupt Practices Act, one count of paying bribes and gratuities, one count of money laundering and two counts of conspiracy “for his role in a scheme to bribe United Nations ambassadors to obtain support to build a conference center in Macau that would host, among other events, the annual United Nations Global South-South Development Expo.”
Halliburton Joins FCPA Repeat Offender Club As The SEC Also Finds That A Former VP Violated The FCPA
In 2009, Halliburton Company, KBR Inc. (a wholly-owned subsidiary of Halliburton during the relevant time period) and Kellogg, Brown & Root, LLC (a wholly-owned subsidiary of KBR) resolved parallel DOJ and SEC Foreign Corrupt Practices Act enforcement actions in connection with a bribery scheme involving a $6 billion liquefied natural gas plant on Bonny Island, Nigeria. (See here and here).
The combined $579 million settlement amount (DOJ – $402 million / SEC $177 million) remains the third largest FCPA settlement of all-time. The SEC’s resolution contained the perfunctory condition of permanently enjoining Halliburton from violating the FCPA’s books and records and internal controls provisions.
However, yesterday Halliburton joined the ever-increasing (see here and here for recent posts) FCPA repeat offender club as the SEC announced an FCPA enforcement action concerning alleged conduct in Angola. Without admitting or denying the SEC’s findings in this administrative order that it violated the FCPA’s books and records and internal controls provisions, Halliburton agreed to pay $29.2 million. In the same order, the SEC also found that Jeannot Lorenz (Halliburton’s former vice president) causing the company’s violations, circumvented internal accounting controls, and falsified books and records. Without admitting or denying the SEC’s findings, Lorenz agreed to pay a $75,000 penalty.
The Current Failure Of The FCPA Pilot Program To Accomplish One Of The DOJ’s Stated “Main Goals”
As highlighted in the article “Grading the DOJ’s FCPA Pilot Program” and this post, it is difficult (if not impossible) to empirically assess whether one of the Pilot Program’s goals (to increase corporate voluntarily disclosures) is actually working. Simply put, many business organizations were voluntarily disclosing prior to the April 2016 Pilot Program and the precise question after the Pilot Program is whether the program is motivating voluntary disclosures to a greater extent than prior to the program.
Yet as highlighted below, it is possible to assess whether another of the DOJ’s stated “main goals” of its Pilot Program is working and at present the undeniable answer is that, as measured against this “main goal,” the Pilot Program is currently failing.
Nearly 20 Corporate FCPA Enforcement Actions By The DOJ, Approximately $1.4 Billion Collected, And Not One Company Employee Has Been Charged With FCPA Offenses By The DOJ
As highlighted here, nearly two years ago the DOJ released the so-called Yates Memo, technically a policy memo titled “Individual Accountability for Corporate Wrongdoing.”
There was really nothing new in the Yates Memo as it continued the DOJ’s rhetoric about the importance of individual prosecutions. Specifically, the Yates Memo repeated the following DOJ rhetoric:
“One of the most effective ways to combat corporate misconduct is by seeking accountability from the individuals who perpetrated the wrongdoing. Such accountability is important for several reasons: it deters future illegal activity, it incentivizes changes in corporate behavior, it ensures that the proper parties are held responsible for their actions, and it promotes the public’s confidence in our justice system.”