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DOJ Announces FCPA And Related Charges In Relation To Griffiths Energy International’s Bribery Scheme Involving Chad

These pages have followed the bribery enforcement action against Canada based Griffiths Energy International (GEI) and related issues for quite a long time.

As highlighted in this post [1], in 2013 Canadian law enforcement brought an enforcement action against GEI under Canada’s Corruption of Foreign Public Officials Act regarding the company’s efforts to obtain a production sharing contract with the African nation of Chad to provide GEI with the exclusive right to explore and develop oil and gas reserves and resources in southern Chad.  As noted in the prior post, in resolving the action, GEI acknowledged that it “directly agreed to provide, and indirectly provided, improper benefits to a Chadian public official in order to further the business objectives of GEI and its subsidiaries.”  The public official was Chad’s Ambassador to Canada, Mahamoud Adam Bechir, and by extension his wife Ms. Nouracham Niam.  Because Chad had no embassy located in Canada, the Ambassador resided in Washington D.C. and the previous post wondered if the DOJ would get involved.

This 2014 post [2] highlighted the DOJ’s civil forfeiture complaint seeking the forfeiture of $106,488.31 in allegedly laundered funds traceable to a $2 million bribe payment made by GEI to Bechir and his wife. As stated by the DOJ:

“From 2004 to 2012, Mahamoud Adam Bechir, 49, served as Chad’s Ambassador to the United States and Canada.  According to the forfeiture complaint, Bechir agreed to use his position to influence the award of oil development rights in Chad in exchange for $2 million and other valuable interests from Griffiths Energy International Inc., a Canadian company.  In order to conceal the bribe, Bechir and his wife, Nouracham Niam, 44, allegedly entered into a series of agreements with Griffiths Energy that provided for the payment of a $2 million “consulting fee” if the company secured the oil rights in Chad.  After securing these oil rights in February 2011, Griffiths Energy allegedly transferred $2 million to an account located in Washington, D.C. held by a shell company created by Niam.  […] The complaint further alleges that, after commingling the bribe payment with other funds and laundering these funds through U.S. bank accounts and real property, Bechir transferred $1,474,517 of the criminal proceeds traceable to the bribe payment to his account in South Africa, where he is now serving Chad’s Ambassador to South Africa.  The current action seeks forfeiture of $106,488.31, which is the current balance of Bechir’s accounts in South Africa.”

This 2015 post [3] highlighted the DOJ’s additional civil forfeiture complaint seeking approximately $34 million which represented the value of “founder’s shares” GEI provided to Bechir “in exchange for Bechir exercising his official influence over the award to the company of lucrative oil development rights in Chad.”

[4]

Yesterday, the DOJ announced [5] the unsealing of a February 2019 criminal indictment against Bechir, his wife, Youssouf Hamid Takane (Chad’s former Deputy Chief of Mission for the United States and Canada) and Naeem Riaz Tyab (a citizen of Canada and founding shareholder of GEI). As stated by the DOJ:

“According to court documents, Mahamoud Adam Bechir and Youssouf Hamid Takane [Chad’s former Deputy Chief of Mission for the United States and Canada] engaged in this scheme between August 2009 and July 2014, while serving as diplomats based out of the Embassy of Chad located in Washington, D.C. According to the indictment, Bechir and Takane demanded the bribe from the Canadian start-up energy company in exchange for a promise to misuse their official positions and their influence with the government of Chad to assist the start-up energy company in obtaining oil rights in Chad. Naeem Tyab, a citizen of Canada and founding shareholder of the start-up energy company, who served as a director of the company from 2009 through 2011, is also charged in the indictment for allegedly arranging for the bribe to be paid to Bechir’s wife, co-defendant Nouracham Bechir Niam, via a sham contract for consulting services that she never actually provided. In addition to the $2 million bribe payment, the start-up energy company also issued shares in the company to Niam, to Takane’s wife, and to a third Chadian individual, as part of the bribe, according to the indictment.”

All four defendants are charged with conspiracy to commit money laundering, and Bechir, Takane, and Niam are also charged with money laundering.

Niam and Tyab are also charged with conspiracy to violate the FCPA. According to the indictment, Tyab and Niam made corrupt payments to Bechir and Takane “in order to obtain lucrative oil contracts for [GEI] from the government of Chad, thereby increasing the value of their respective holdings and property interests in [GEI].” Both Tyab and Niam are charged under the dd-3 prong of the FCPA’s anti-bribery provisions and the indictment contains several allegations regarding conduct in Washington, D.C. in furtherance of the alleged bribery scheme.

In the DOJ’s release Acting Assistant Attorney General Nicholas McQuaid stated:

“These defendants allegedly engaged in a multimillion dollar bribery scheme while in the United States and then used the U.S. financial system to launder the bribes to conceal their conduct. The charges unsealed today demonstrate the department’s determined commitment to investigate and prosecute corruption wherever it occurs and the officials who use our financial system to launder their bribes. Corruption undermines trust in governments and prevents the free market from functioning fairly for law-abiding people and companies.”

Acting U.S. Attorney Channing Phillips of the District of Columbia stated:

“The bribery and corruption of foreign officials causes grave harm to both the global economy and the interests of the United States. My office and the Justice Department are committed to prosecuting these violations and efforts to launder the proceeds of these crimes.”

Steven D’Antuono, Assistant Director in Charge of the FBI’s Washington Field Office, stated:

“Accepting and soliciting bribes seriously threatens the integrity of our economic system. When corrupt foreign officials launder funds through the United States in furtherance of their criminal activity, the FBI will work tirelessly to hold those officials accountable and send a message that we will not relent in our efforts to uphold the law.”

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