It is relatively common for the DOJ to allege a foreign bribery scheme, but “only” charge an individual with money laundering. These cases tend to involve alleged “foreign official” bribe recipients who – courts have concluded – are not subject to the FCPA anti-bribery provisions.
The DOJ has also criminally charged individuals in what “sounds” like an FCPA violation, but an FCPA violation is not alleged (see here for instance).
But what about the DOJ specifically alleging that an individual violated the FCPA’s anti-bribery provisions, yet the DOJ not charging the individual with FCPA anti-bribery violations?
As highlighted below, in recent months the DOJ has made this curious charging decision three times.
In March, the DOJ announced criminal charges against Jorge Cherrez Mino and John Robert Luzuriaga Aguinaga in connection with a bribery scheme in Ecuador. (See here). According to the criminal complaint, Cherrez (a citizen of Ecuador who is currently located in Mexico) served as the manager, president, and director of the “U.S. Investment Fund Companies” (a domestic concern under the FCPA) and Luzuriaga (a citizen of Ecuador who is currently located in Florida) served as the Risk Director for Instituto de Seguridad Social de la Policia Nacional (“ISSPOL” – an Ecuadorian public institution responsible for managing the financial contributions by Ecuadorian police officers toward their social security). The complaint alleges that “ISSPOL was controlled by the government of Ecuador and performed a function that Ecuador treated as its own, and was an ‘instrumentality’ of the Ecuadorian government.”) Even though the Cherrez complaint alleged a jurisdictional basis for FCPA anti-bribery offenses and indeed alleged that Cherrez violated the FCPA, Cherrez was “only” charged with money laundering offenses.
As highlighted in this post, in April Raymond Kohut (a Canadian citizen who lived in the Bahamas and worked in business development for Gunvor Group Ltd., a Switzerland based commodities firm) pleaded guilty in connection with an Ecuador bribery scheme. In summary fashion, the DOJ alleged that between 2012 and 2020, Kohut and others “engaged in international bribery and money laundering schemes” and that in “furtherance of those schemes, Kohut, together with others, knowingly, willfully and corruptly agreed to offer and pay bribes on behalf of Trading Company [Gunvor] to, and for the benefit of, Ecuadorian officials, in order to obtain and retain business for Trading Company.” As relevant to the FCPA, the criminal information alleged that in furtherance of the bribery scheme, Kohut met with Ecuadorian Official #1 and others at a “house in Miami, Florida to discuss one of the Petroecuador contracts for which bribes would be paid” and that Kohut met with others “at a restaurant in Coral Gables, Florida to discuss certain of the contracts for which bribes would be paid.” Nevertheless, Kohut was “only” charged with money laundering offenses to which he pleaded guilty.
Most recently, as highlighted in this post, the DOJ announced that four individuals were criminally charged in connection with a Bolivian bribery scheme to secure a tear gas contract. Among the individuals charged were Bryan Berkman, Luis Berkman, and Philip Lichtenfeld (all U.S. citizens and as to the Berkman’s owners of Florida-based companies). Even though the probable cause affidavit filed in support of the criminal complaint alleged that the Berkmans and Lichtenfeld violated the FCPA’s anti-bribery provisions, the criminal complaint “only” charges the individuals with money laundering conspiracy.
To the individuals criminally charged in the above actions, it probably is not a significant issue whether they were actually charged with FCPA offenses or not.
But to someone who tracks FCPA enforcement statistics – what to do? After all, if FCPA enforcement statistics are to mean anything – shouldn’t such statistics only capture enforcement actions in which an individual (or company) is actually charged with FCPA offenses?
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