One odd aspect of Foreign Corrupt Practices Act enforcement is that some enforcement actions are accompanied by all the bells and whistles the DOJ can find, while others – well – aren’t even mentioned at all by the DOJ.
Search the DOJ’s FCPA website and you will not find an FCPA enforcement action against Carlo Alloni (an Italian citizen and former Ericsson executive).
But there was one.
In May 2018, the DOJ charged Alloni (picture from his LinkedIn profile) with conspiracy to violate the FCPA’s anti-bribery provisions.
As alleged in the criminal information, Alloni “conspired to bribe government officials in the Republic of Djibouti in order to assist Company A in obtaining and retaining business for and with, and directing business to, Company A, a subsidiary of Company A (“Subsidiary A”), and others.”
According to the court docket, the May 2018 criminal information was sealed and remained sealed until September 2021 when Alloni pleaded guilty.
During that time period, in late 2019 Swedish telecom company Ericsson (a company with American Depositary Shares traded in the U.S.) resolved a $1.06 billion net FCPA enforcement action concerning conduct in Djibouti, China, Vietnam, Kuwait, Indonesia, and Saudi Arabia. (See here for the prior post).
September 2021 was when the DOJ announced that Afework “Affe” Bereket (another former Ericsson executive) was criminally charged with one count of conspiracy to violate the FCPA’s anti-bribery provisions and one count of conspiracy to commit money laundering “for his alleged role in a scheme to pay approximately $2.1 million in bribes to high-level government officials in the Republic of Djibouti and conspiring to launder funds to promote the scheme.” (See here for the prior post).
Earlier this week, Alloni was sentenced – well – to nothing. As noted in this article:
“Manhattan U.S. District Judge George B. Daniels credited defendant Carlo Alloni, 56, an Italian citizen who now lives in England, with giving a heavy measure of assistance over six years that led to one of the largest-ever corporate resolutions of charges brought under the Foreign Corrupt Practices Act.
“In this case, given the substantial nature and significance of the defendant’s cooperation, I am going to impose a sentence of time served,” Judge Daniels said. “I see no need to require any further supervision in the United States.”
[…]
Alloni’s lawyer asserted Wednesday that information he provided marked a “tipping point” in the U.S. probe.
Alloni, who told the court he was “nervous and emotional,” apologized and said that after 10 years of “dark clouds” he needs to restart his life and find gainful work, as he is currently unemployed.
“I made the worst mistake of my life and I regret it to this day,” he said. “I’m a broken soul. I’ve learned my lesson and I fully regret what I did. My family needs me and I need to find my life again.”
Alloni is free to return to England but he has represented that he will be available to prosecutors should they ever apprehend defendant Afework Bereket, a former Ericsson executive against whom an indictment was unsealed in 2021 in connection with the scheme. Bereket has not appeared in U.S. court.”
In a June 14th letter to the court regarding sentencing (portions of which are redacted) the government stated in pertinent part:
“As he admitted during his plea proceeding, Alloni, while working for the Swedish telecommunications provider Telefonaktiebolaget LM Ericsson (“Ericsson”), engaged in a conspiracy to bribe senior government officials of Djibouti, in violation of the Foreign Corrupt Practices Act (“FCPA”), in order to obtain for Ericsson a contract with Djibouti’s state-owned telecommunications company. But Alloni also provided valuable assistance to the Government’s investigation and prosecution of two entities, Ericsson and its subsidiary Ericsson Egypt Ltd. (“Ericsson Egypt”), which pleaded guilty to criminal offenses and paid a total criminal fine to the United States exceeding $727 million; and one individual, former Ericsson employee Afework Bereket (“Bereket”), who has been indicted but not yet arrested for his role in the bribery scheme. In addition, Alloni provided significant assistance to Swedish law-enforcement authorities and their investigation of this same criminal conduct.
[…]
In March 2017, law enforcement agents approached Alloni at an airport as he entered the United States, then interviewed him about the Ericsson bribe payments. Alloni lied during that interview, falsely denying knowledge of any corruption. For example, Alloni denied knowing what Bereket meant when he wrote about people in Djibouti needing a slice of “cake”; he denied ever dealing with public officials regarding contracts; he claimed that a reference he made in an email to [redacted] being “involved” meant merely that [redacted] was involved in monitoring the performance of Djibouti’s telecom network; and he claimed to be “100 percent sure” that Ericsson’s wire transfer of more than $1 million to [redacted] in August 2011 was not related to any payment to [redacted].
In July 2017, however, Alloni—this time accompanied by counsel—met with the Government again and confessed the truth about his role in the Djibouti bribery scheme. He admitted his active role in helping Ericsson bribe Djibouti’s top officials in order to obtain business with [redacted]. In doing so, Alloni necessarily contradicted the false denials he had made when interviewed months earlier. He admitted, for example, that he and everyone else who received Bereket’s email referring to people awaiting pieces of “cake” knew that Bereket was describing improper bribe payments. But Alloni did not merely confirm that communications already in the Government’s possession reflected discussions of improper bribes. He also disclosed additional, self-incriminating details that had not previously been known to the Government. Notably, Alloni described meetings he personally attended in Djibouti, at which he and others negotiated the bribery scheme on Ericsson’s behalf. He recounted one meeting in which [redacted] personally demanded bribes for himself, for [redacted]. Alloni also described conversations he had with Bereket and others at Ericsson about how to arrange those bribes, explaining that the conspirators falsely characterized the bribes as payments to [redacted] for consulting services. Alloni’s account of these events was credible, and it demonstrated that the bribery scheme was not the work of one or two rogue employees, but rather the work of many employees representing the larger company.”
In a June 20th brief to the court regarding sentencing, Alloni’s counsel stated in pertinent part:
“Mr. Alloni has accepted the consequences of his wrongs and has showed his family and friends – who continue to overwhelmingly support him – that there is only one right way to handle mistakes: own up to the mistake and cooperate fully and extensively with the government in its investigation of others involved in the same conduct.
Mr. Alloni was the first targeted individual who cooperated with the government regarding its investigation of Foreign Corrupt Practices Act (“FCPA”) violations at Swedish multi-national telecommunications company Telefonaktiebolaget LM Ericsson (“Ericsson”), which led to $1.3 billion in fines (both criminal and civil) and a guilty plea by corporate entities. Mr. Alloni has cooperated extensively. He gave multiple interviews to the government that led to criminal charges against Ericsson and others, provided assistance in the government’s charge that Ericsson breached its initial deferred prosecution agreement which then led to a corporate guilty plea, and even voluntarily testified as a key witness at a criminal trial in Sweden against other Ericsson executives. Mr. Alloni has been under pre-trial release since May 2018, and has behaved admirably over those five years, complying with all conditions of his release. Finally, Mr. Alloni also is willing to continue to cooperate with the government even after the conclusion of this case.”
