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The Elusive Mr. Kozeny

Today’s post is from Brian Whisler (here – a former federal prosecutor and current partner at Baker & McKenzie).


On March 28, 2012, the Bahamian Privy Council dismissed the U.S. Justice Department’s appeal of the lower court’s decision on jurisdictional grounds, largely though not entirely foreclosing the U.S. effort to extradite Victor Kozeny to stand trial and defend against FCPA/money laundering charges pending in the Southern District of New York.  (See here for the 2005 indictment).   The Privy Council’s opinion (here) reflects some unfavorable comments on the merits of the Justice Department’s extradition case, but did provide some leave for the U.S. to renew its extradition attempt. For now, Kozeny is free to remain in the Bahamas, but faces a pending extradition request from the Czech Republic (relative to defrauded investors), which was awaiting the outcome of the U.S. extradition request.

Whether the Justice Department will continue to pursue Kozeny after seven years of effort remains an open question. As the sentencings of the co-defendants in the Bourke/Kozeny matter (Bodmer, Farrell, and Lewis) have been deferred since 2005 pending extradition of Kozeny, there may be some pressure to dismiss against Kozeny and bring closure to the co-defendants’ cases.

The Kozeny quest illustrates the challenge associated with charging foreign nationals in FCPA cases (and criminal cases generally).  In the event that the U.S. authorities elect to dismiss against Kozeny, they may perhaps take some comfort knowing that Kozeny served 19 months in pre-trial detention in a Bahamian prison, while co-defendant Frederick Bourke was sentenced (though yet to serve) only 12 months, one day for his role in the conspiracy. It has also been reported that Kozeny has spent in excess of $1 million in legal fees fighting extradition to the United States.

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