Top Menu

Africa Sting Update

The Africa Sting case is surely one to watch in 2011.

Recently, certain defendants filed a motion (here) “for an evidentiary hearing requiring the testimony of Richard Bistrong and federal law enforcement agents responsible for managing him in connection with the investigation resulting in the indictment.” The defense claims that Bistrong (see here for a prior post) assured various defendants that the fake Gabon deal had been approved by the U.S. State Department, was not illegal, was not in violation of the FCPA, and that Bistrong “angrily admonished one Defendant who indicated that he was going to tell other defendants that his lawyer had advised that the Gabon deals might be illegal.”

The DOJ response brief is here. The DOJ says that the defense has “presented the Court with selective and misleading facts about this case” and that many of the defendants, wholly apart from the Gabon deal, were involved in paying bribes to foreign officials in other countries. Further, the DOJ argues, pretrial resolution of factual issues is not warranted.

So what does this all mean for the defendants’ entrapment defense?

As entrapment issues are a bit outside my strike zone, I once again go to the bullpen and call upon Dru Stevenson (here) a Professor of Law at South Texas College of Law.

In this guest post, Professor Stevenson analyzes the issues presented in the above briefs.

*****

“The defendants in the pending FCPA “Africa Sting” case have moved for a pretrial evidentiary hearing, insisting that the government has refused to produce – or perhaps destroyed – potentially exculpatory evidence in the case. The defendant’s allegations of Brady violations (failure to turn over evidence) are serious, but seems based on serious misunderstandings of federal entrapment law.

All of the items alleged to be missing relate to the FBI’s instructions to Bistrong, its undercover informant in the sting operation – a turncoat FCPA violator who offered to set up others as part of his “deal” with the government. The problem is that such information could not be exculpatory under the federal rules for the entrapment defense, which appears to be the defendants’ only theory of the case. Federal courts use only the “subjective test” for entrapment claims, a test that focuses exclusively on the defendant’s own predisposition to commit the crime, NOT the government’s conduct or intentions in the sting operation. It may strike us as upsetting to read about FBI handlers coaching their field operative on lying and deception of the potential felons, but this is legally immaterial for the entrapment defense, because it does not relate to the defendant’s predisposition to commit the crime. If the missing evidence is not “material evidence” for the defense, there is no Brady violation.

Surprisingly, the government’s response brief does not emphasize this issue, but focuses instead on the inappropriateness of a pre-trial hearing when the issues will get full airing at trial. This is probably true, but a court might feel there is no harm in allowing evidentiary hearings before trial, which is rather commonplace.

The defendants advance two points in their brief that, if successful, would dramatically change the law of entrapment in the United States. First, there is a recurring theme throughout the brief that evidence of outright lying by the undercover operative in a sting operation is exculpatory. It is not. All entrapment claims involve sting operations; all sting operations involve some deception and lying to ensnare the defendant; and nearly all entrapment claims fail. Deceiving the defendant may reach a level where it negates the required mens rea for the crime – but this is a mistake of fact defense, a derivative defense that refutes an element of the crime charged, not entrapment, which is an affirmative defense. The defendants in this case do not appear to be raising a derivative defense related to the scienter requirement for FCPA – their case centers on claims of entrapment. Intentional deception is immaterial for the defendant’s predisposition, which is the issue at stake for entrapment in the federal system. Nor does it matter that the undercover operate gave false assurances that the proposed transaction was legal (which the defendants allege happened, and the government denies). This is presumably a common feature of sting operations as well – blithe reassurances that the deal is “completely legal” – just as it is a common feature of conspiracies and recruitment by real criminals, not just undercover agents. In the United States, ignorance of the law is no excuse. There is a seldom-used, and even more seldom-successful, defense of “entrapment by estoppel,” not at issue in this case, for instances where the defendant receives official assurances of legality directly from a government authority, such as an opinion letter from the Attorney General. Yet this would not apply to situations where the co-conspirator merely asserts that he “checked it out” or got “clearance” from the State Department.

A second innovation in the defendant’s brief, which would mark a sea change in entrapment law if successful, is the assertion that dismissal of the charges is an appropriate remedy for “entrapment as a matter of law.” There is no such thing as “entrapment as a matter of law” in the federal system – no Supreme Court cases have ever recognized an entrapment scenario that would need no adjudication or factual determinations. The Supreme Court has been very clear, in every entrapment case, that federal courts should use the “subjective test” for entrapment, which requires a full factual inquiry into the defendant’s predisposition to commit the crime. This is really a two-pronged innovation – one part focused on changing the test used, and the other focused on the procedural juncture for rendering a decision on such claims. “Entrapment as a matter of law” is really another name for the rival version of the entrapment test, usually called the “objective test” (which evaluates what the outrageousness of the government’s conduct rather than the defendant’s subjective predisposition) – a test that the Supreme Court has rejected every time it decided an entrapment case. Essentially, the defendants are asking the court to change the entrapment test used in the federal system from the subjective to the objective test, contrary to long-settled precedent. Further, positioning this decision within a Motion to Dismiss is particularly unprecedented, even for the objective test. Entrapment cases are heavily fact-specific under either test, because they all involve sting operations that included some inducement – and usually a fair amount of false reassurances and even badgering by the agents. Dismissal is generally a remedy for legal problems with the prosecution’s case, not factual problems. Again, it may be troubling to read of the FBI’s undercover operative lying, badgering, and bribing a defendant to commit a crime, but this is a matter for the jury to decide – and, from a policy standpoint, is no different from what would happen in a “true” criminal enterprise. In other words, a defendant who falls for halfhearted, unsupported reassurances by the undercover – or who succumbs to a monetary inducement or mild badgering – would presumably also fall for the same tactics by a criminal organizer.”

*****

For Professor Stevenson’s other guest posts on the Africa Sting case see here and here.

Will Bistrong’s Plea Impact The Africa Sting Cases?

Last week Richard Bistrong’s plea agreement was made public.

Who is Richard Bistrong?

He is “Individual 1” – the person who worked with FBI agents as alleged in the Africa Sting indictments. (See here). (See here for the superseding indictment).

Bistrong was soon identified as Individual 1 and criminally charged.

Not in connection with the Africa Sting case, but a completely different matter. (See here). The criminal information (here) charges Bistrong with conspiracy to violate the Foreign Corrupt Practices Act’s antibribery provisions, books and records provisions, and the International Emergency Economic Powers Act and related Export Administration Regulations.

The conspiracy was broad in scope and included charges that Bistrong conspired with others: (i) to obtain for his employer [Armor Holdings, a former publicly-traded company, currently a subsidiary of BAE Systems] United Nations body armor contracts (valued at $6 million) by causing his employer to pay $200,000 in commissions to an agent while knowing that the agent would pass along a portion of that money to a United Nations procurement officer (a “foreign official” per the FCPA) to cause the officer to award the contracts; (ii) to obtain for his employer, a $2.4 million pepper spray contract with the National Police Services Agency of the Netherlands by paying a Dutch agent approximately $15,000 while knowing that the agent would pass along some of that money to a procurement officer with the Police Services Agency to influence the contract; and (iii) to obtain for his employer (although it was never obtained), a contract to sell fingerprint ink pads to the Independent National Elections Commission of Nigeria by making kickback payments to a commission official indirectly through an intermediary company.

Bistrong’s criminal information was filed on January 21, 2010.

It turns out that Bistrong agreed to plead guilty nearly a year before that – in February 2009, as indicated in the Bistrong plea agreement (see here).

So what did Bistrong agree to when he signed the plea agreement in February 2009?

To cooperate fully with with the government, including:

“whenever requested by the Government, working in an undercover role to record meetings and telephone calls under the supervision of United States law enforcement;” and

“attending all meetings at which the Government requests his presence.”

Per the Bistrong plea agreement, Bistrong “and the Department of Justice agree that the [Sentencing Guidelines] sentence is five years’ imprisonment.” Even so, the plea agreement states: “if in the sole and unreviewable judgment of the Government the defendant’s cooperation is of such quality and significance to the investigation or prosecution of other criminal matters as to warrant the Court’s downward departure from the sentence calculated by the Sentencing Guidelines, the Government may at or before sentencing make a motion pursuant to Section 5K1.1 of the Sentencing Guidelines reflecting that the defendant has provided substantial assistance and recommending a downward departure from the applicable guideline range.”

Brady Toensing (diGenova & Toensing, LLP) (see here) represents Bistrong.

What impact will Bistrong’s plea have in the Africa Sting case – particularly the defendants’ expected entrapment defense?

Per the superseding indictment, the earliest conduct forming the basis of the criminal charges against the Africa Sting defendants occurred in May 2009. In other words, Bistrong had already agreed to plead guilty to separate criminal charges prior to introducing the Africa Sting defendants to the undercover “foreign official” or the “foreign official’s” undercover representative.

Will this matter?

Unlikely says Dru Stevenson, a Professor of Law at South Texas College of Law (see here). Professor Stevenson previously offered his thoughts on the entrapment issue (here) and offered these thoughts in light of Bistrong’s plea.

“The incentives of the informant or undercover agent have never mattered in an entrapment defense, under either of the tests that courts use. For the subjective test (used in federal court), entrapment analysis focuses entirely on the defendant’s predisposition to commit the crime. The incentives of the agent provocateur are irrelevant. For the objective test (used in a minority of states, but never in the federal courts), entrapment analysis focuses on the actual conduct of the undercover agents – how outrageous it was – but not on the agent’s incentives or motives. It would be a completely novel approach if a court gives any weight to the fact that the agent provocateur had made a plea bargain. And it is not clear why this should matter any more than an undercover police officer who is paid to trick criminals into committing crimes as part of a sting operation.”

Africa Sting Updates

It’s been a while since the last post on the Africa Sting cases.

Below is a summary of recent activity.

Last week, the DOJ filed a routine discovery notice (see here) that perhaps hints at a much broader case.

In relevant part, the DOJ stated:

“The government has produced to each defendant and his or her co-defendant documents regarding the defendant’s participation in the Country A deal charged in the indictments and historic deals, including emails, invoices and quotes. Documents related to other co-conspirators’ participation in the Country A deal and historic deals have been made available to the defendants upon request.” (emphasis added).

Time will tell what is meant by “historic deals.”

However this case is already wider than the case charged in January (see here). In March, the DOJ filed a superseding indictment (see here) against Daniel Alvirez, the President of ALS Technologies, Inc. The superseding indictment contains charges against Alvirez not found in the original indictment, specifically charges related to the Republic of Georgia. Alvirez is expected to plead guilty to charges of conspiracy to violate the FCPA as set forth in the superseding indictment and cooperate in the government’s investigation.

For more on the DOJ’s discovery filing (see here) from Christopher Matthews at Main Justice.

*****

When the Africa Sting case was first announced, I raised the issue (see here) of whether the defendants could even be found guilty of violating the FCPA’s antibribery provisions given that the “foreign official” was not real.

At the time, it was yet known whether the “foreign official” was purely fictitious or an actual, yet non-participating person.

I suspected the later and Main Justice (see here) recently reported that the FBI agents involved in the sting operation were posing as representatives of Ali Ben Bongo – the current president of Gabon and the Minister of Defense of that country from 1999 to 2009.

Because the FCPA’s relevant provisions include terms such as influence and induce, it remains an open question whether one can seek to induce or influence an actual, yet non-participating “foreign official.”

*****

Finally, during a status hearing yesterday, Judge Leon indicated (see here) that it was highly unlikely that the cases would go to trial in 2010.

Also at the status conference, defense lawyers continued to argue that the DOJ has not produced sufficient information concerning Richard Bistrong – a key participant in the government undercover sting operation – yet a person who was also recently criminally charged in connection with a separate bribery scheme (see here for the prior post).

Judge Leon reportedly said that the FBI’s relationship with Bistrong is “likely relevant to the case” and that DOJ is going to have produce documents and information concerning this issue.

The next status hearing is April 21st.

Africa Sting – “Individual 1” Identified … and Charged … In a Different Case

“Individual 1” – a key player in each of the Africa Sting indictments (see here) has been identified by the New York Times (see here) as Richard T. Bistrong, a former employee of Armor Holdings. (Armor Holdings, a former publicly-traded company, is currently a subsidiary of BAE Systems).

In an ironic twist, Bistrong was charged today in a criminal information (see here) with conspiracy – not for his role in the Africa Sting case – but a wholly separate bribe scheme.

The information charges Bistrong with conspiracy to violate the FCPA’s antibribery provisions, books and records provisions, and the International Emergency Economic Powers Act and related Export Administration Regulations.

The conspiracy is broad in scope and includes charges that Bistrong conspired with others: (i) to obtain for his employer, United Nations body armor contracts (valued at $6 million) by causing his employer to pay $200,000 in commissions to an agent while knowing that the agent would pass along a portion of that money to a United Nations procurement officer (a “foreign official” per the FCPA) to cause the officer to award the contracts; (ii) to obtain for his employer, a $2.4 million pepper spray contract with the National Police Services Agency of the Netherlands by paying a Dutch agent approximately $15,000 while knowing that the agent would pass along some of that money to a procurement officer with the Police Services Agency to influence the contract; (iii) to obtain for his employer (although it was never obtained), a contract to sell fingerprint ink pads to the Independent National Elections Commission of Nigeria by making kickback payments to a commission official indirectly through an intermediary company.

As the New York times notes, a “criminal information is typically filed when the defendant has waived indictment and is negotiating a plea agreement.”

The New York Times story concludes by describing the abrupt end to today’s court hearing.

Powered by WordPress. Designed by WooThemes