As the saying goes – where there is smoke there is fire.
Yesterday the DOJ announced that Bryan Berkman, Luis Berkman, Philip Lichtenfeld and Sergio Mendez were criminally charged for their roles in a Bolivian bribery scheme to secure a tear gas contract.
Bryan Berkman, a U.S. citizen, is described as owning a Florida company (“Intermediary Company”) that sold tactical equipment including to the Bolivian Ministry of Defense. According to this article, the company is Bravo Tactical Solutions.
Sergio Mendez, a citizen of Bolivia, served as an official in the Bolivian Ministry of Government from 2019 – 2020.
Luis Berkman, also a U.S. citizen and Bryan’s father, is described as a “close associate” of Mendez as well as an “associate” of co-conspirator 1 (described as a high ranking official in the Bolivian Ministry of Government). According to the same article, Luis runs a Florida based company called International Defense Group.
Philip Lichtenfeld, a U.S. citizen, is described as an associate of the Berkmans and Mendez.
Even though the probable cause affidavit filed in support of the criminal complaint alleges that the Berkmans and Lichtenfeld violated the FCPA’s anti-bribery provisions, the criminal complaint only charges all four defendants with money laundering conspiracy. As will be highlighted in a future post, the DOJ has made this similar interesting charging decision (i.e. allege that an individual has violated the FCPA, but not charge FCPA violations) in other recent enforcement actions.
According to the affidavit, the Berkmans and Lichtenfeld paid bribes totaling at least $582,000 to Mendez and at least $20,000 to Co-Conspirator 2, an official in the Bolivian Ministry of Defense, in exchange for using their official positions to assist the individuals and Intermediary Company to obtain and retain business in violation of the FCPA and Bolivia’s laws against bribery of a public official and public servant.
The affidavit further alleges that the “with the intent to promote the carrying on of the illegal bribery scheme” that the charged individuals “caused transfers from a bank account at the Central Bank of Bolivia … to bank accounts belonging to Intermediary Company located in the United States, and transfers from a bank account belonging to Intermediary Company located in the U.S. to a bank account controlled by Lichtenfeld located in Bolivia.”
According to the affidavit, from November 2019 to April 2020, Mendez, Co-Conspirator 1, Co-Conspirator 2 and others “used their official positions to assist Intermediary Company with obtaining government contracts to supply non-lethal weaponry and tactical equipment to the Bolivian Ministry of Defense and to receive payment from the Bolivian Ministry of Defense.” The affidavit further alleges that:
“In November 2019, Bryan Berman … and his father Luis Berkman, sought to win a contract from the Bolivian government to act as an intermediary for the Bolivian Ministry of Defense’s purchase of tear gas and other non-lethal equipment from Brazil Company [described as a company that manufactured tactical and non-lethal defense equipment].”
[…]
On or about December 19, 2019 Intermediary Company executed a contract with the Bolivian Ministry of Defense to supply tear gas and other non-lethal equipment in exchange for approximately $5,649,137 (the Tear Gas Contract). Bryan Berkman signed the Tear Gas Contract on behalf of Intermediary Company.
A purchase order dated December 17, 2019, shows that Intermediary Company purchased the equipment required under the Tear Gas Contract from Brazil Company for approximately $2,257,735, which left Intermediary Company with approximately $2,291,402.”
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