In late 2023, the DOJ announced the unsealing of an indictment criminally charging: Carl Alan Zaglin (the owner of a Georgia-based manufacturer of law enforcement uniforms and accessories); Francisco Roberto Cosenza Centeno (former Executive Director of the Comité Técnico del Fideicomiso para la Administración del Fondo de Protección y Seguridad Poblacional (TASA) a Honduran governmental entity that procured goods for the Honduran National Police); and Aldo Nestor Marchena (a dual citizen of the U.S. and Peru) for their alleged participation in a scheme to pay and conceal bribes to Honduran government officials to secure contracts to provide uniforms and other goods to the Honduran National Police. (See here for the prior post).
Cosenza and Marchena previously pleaded guilty.
Last week, the Zaglin trial began in the S.D. of Florida (and is believed to be just the 24th FCPA jury trial in the FCPA’s nearly 48 years).
As stated in the DOJ’s trial brief:
“The Indictment alleges that the Defendant, the former majority owner and Chief Executive Officer of Atlanco, and his co-conspirators conspired to bribe—and did in fact bribe—Honduran government officials, including Cosenza and Molina, to obtain, and ensure payment on, over $10 million in contracts with the Comité Técnico del Fideicomiso para la Administración del Fondo de Protección y Seguridad Poblacional (TASA), a Honduran governmental agency that procured goods and services for the Honduran National Police and other government agencies. The Indictment describes two contracts won by Atlanco: the “First Uniform Contract,” executed in June 2015, and the “Second Uniform Contract,” executed in October 2016. The Indictment also alleges that the Defendant and others conspired to pay bribes in connection with a third uniform contract in 2019, which was ultimately unsuccessful. The government expects that the evidence at trial will show that the conspiracy began in approximately March 2015 and continued through approximately November 2019.
The Indictment alleges that, in furtherance of the scheme, the Defendant and his coconspirators laundered over $2 million in funds that were used to pay bribes to Honduran officials, including Cosenza and Molina. The evidence at trial will show that Zaglin orchestrated the scheme with his business partner, Brian DeHart (then-President of Atlanco) [who died in 2023] Luis Berkman (Atlanco’s then-Vice President of International Sales), and several others. Beginning in or around early 2015, executives from Atlanco and representatives of a Florida-based distributor of tactical gear and equipment named Tactical Products Group (TPG) sought to win a contract worth approximately $4.8 million to sell uniforms and accessories to the Honduran National Police, which was part of the Honduran Ministry of Security.
The evidence at trial will show that, to create a pool of money for the bribes, and to conceal the scheme, the Defendant and his co-conspirators allocated $750,000 for a so-called “admin” fee. Further, in or about September 2015, the Defendant and his co-conspirators recruited Marchena, who lived and worked in the Southern District of Florida, to launder the bribes and to make payments to Cosenza, Molina, and others on Atlanco’s behalf. To conceal the scheme, the Defendant (on behalf of Atlanco) entered into purported “Brokerage Agreements” with Marchena and paid Marchena through invoices that purported to reflect actual work completed by Marchena on behalf of the Defendant and Atlanco.
Under the Brokerage Agreement, corresponding to the First Uniform Contract, the Defendant paid Marchena approximately 25% of Atlanco’s contract proceeds, or approximately $1.2 million. Under the second Brokerage Agreement, backdated to correspond to the Second Uniform Contract, the Defendant paid Marchena approximately 21% of Atlanco’s contract proceeds, or approximately $1.2 million.
The evidence at trial will show that Marchena did in fact pay bribes to Cosenza and Molina on behalf of the Defendant. Marchena wired bribe payments to bank accounts in Belize and the United States, among other payments. The Defendant and his co-conspirators also paid bribes to Cosenza in cash, and made payments to an individual named Jaime Nativi, knowing that some or all of those payments would be used to pay bribes.
In approximately 2018, the Defendant and Atlanco bid on a third uniform contract, which was ultimately awarded to another manufacturer. However, in 2018 and 2019, the Defendant and Atlanco entered into two additional contracts with TASA. In approximately June 2019, the Defendant wire transferred a portion of the proceeds from the 2019 contracts to International Defense Group, an entity controlled by coconspirator Luis Berkman. Luis Berkman used the proceeds, in part, to pay cash bribes.
Finally, the evidence will show that, in 2019, the Defendant and others agreed to pay bribes to Cosenza and others in connection with the 2019 uniform contracts bid. In furtherance of their corrupt agreement, in or about November 2019, the Defendant aided and abetted and caused DeHart to email a bid for the additional uniform contract to a Florida-based consultant.”
Earlier today, the jury found Zaglin guilty of a substantive FCPA anti-bribery violation, conspiracy to violate the FCPA’s anti-bribery provisions, and conspiracy to commit money laundering.
Sentencing is set for December 3rd.
In this release, Acting Assistant Attorney General Matthew Galeotti of the Justice Department’s Criminal Division stated:
“Instead of playing by the rules, Carl Zaglin unfairly sought to get ahead and enrich himself by paying bribes to Honduran officials. Bribing government officials to win business undermines the rule of law and distorts competitive markets. [This] verdict reaffirms the Criminal Division’s commitment to rooting out corruption and providing an equal playing field for American businesses.”
