Foreign Corrupt Practices and The Dream Factory: Recent Cases in Point

Yet Another FCPA Matter — This Time It’s Lucent: The White-Collar Crime Prof also notes a trend toward more vigorous enforcement of the Foreign Corrupt Practices Act.

On Lucent-Alcatel, see also

I am interested in Latin American cases of this kind, as you know. See, for example,

Cases involving the Foreign Corrupt Practices Act (FCPA) are clearly on the rise. This time it involves a settlement with Lucent Technologies, Inc. The company will be paying a fine of one million dollars to resolve FCPA allegations. What is happening with these settlements is that the contours of what is permitted expenses and what will not be tolerated are coming to light. Companies are finding out the hard way, that it is better to err on the side of not paying sums that might in any way be considered bribery to a foreign official.

Factory inspections of Disneyland (in Jack Abramoff’s case, it was a coveted tee-off time at St. Andrews in Scotland):

Between 2000 and 2003, Lucent also provided Chinese government officials with post-sale trips that were typically characterized as “factory inspections” or “training” in contracts with its Chinese government customers. By 2001, however, Lucent had outsourced most of its manufacturing and no longer had any Lucent factories for its customers to tour. Nevertheless, Lucent provided individuals with trips for “factory inspections” to the United States, Europe, Australia, Canada, Japan and other countries that involved little or no business content. These trips consisted primarily or entirely of sightseeing to locations such as Disneyland, Universal Studios, the Grand Canyon, and in cities such as Los Angeles, San Francisco, Las Vegas, Washington, D.C., and New York City, and typically lasted 14 days each and cost between $25,000 and $55,000 per trip.

Another recent FCPA prosecution raises some interesting questions because of its domestic political ramifications in the case of

There are parts of the world where corruption charges flow like the mighty Amazon, and not all of them are credible, you know.

A Press Release of the DOJ tells that “a film executive and his spouse were arrested today on allegations of making corrupt payments to a Thai government official in order to obtain lucrative contracts to run an international film festival in Bangkok, in violation of the Foreign Corrupt Practices Act (FCPA).” The case – -charged in early December, but just unsealed — alleges that the defendants “conspired to make more than $1.7 million in bribe payments for the benefit of a government official with the Tourism Authority of Thailand (TAT) in order to obtain the film festival contract and contracts with TAT worth more than $10 million.” The defendants are alleged to have been bidding “for the management contract for the annual Bangkok International Film Festival.”

These sorts of stories tend to omit the name of the bribe recipient by convention, it seems.

The complaint alleges that from 2003 and continuing into 2007, the Greens conspired with others to bribe a senior Thai government official who was, at the time, the President of the BKKIFF and the Governor of the TAT.

Variety does name the official, however, and reports:

An FBI affidavit identifies 80 payments, including 41 that were made to the governor’s daughter, who was not an official of the festival.It is not clear whether the Thai antigraft agency cooperated with the FBI in the Green probe or whether it will bring its own charges against Siriwan.

That was just the question that occurred to me, too.Variety: A proud tradition of good, thorough journalism on a lucrative industry that earns its daily bread from the “circuses” side of the “bread and circuses” equation.

It even offers equal time to the accused:

Siriwan held a press conference Wednesday in Bangkok to face down the accusations. “I have made an inquiry into the company in L.A., and was informed that the issue of bribery was raised by staff who were fired from the firm, so I believe this is an internal conflict,” she said.

The Bangkok Post:

The complaint did not directly name Thai official allegedly involved but said “she” was president of the Bangkok International Film Festival and governor of the TAT. The only person apparently meeting that description is Juthamas Siriwan. She is currently contesting the December 23 parliamentary election with the Puea Pandin party. Ms Juthamas denied any involvement in the scandal. She said she would sue the US Justice Department if it attempted to tie her to the case. Her statement was difficult to reconcile since the US authorities have already directly tied her to the case.

The Post again:

Prime Minister Surayud Chulanont will hold talks with National Police Chief Seripisuth Temiyavej on the bribery scandal surrounding the former governor of the Tourism Authority of Thailand (TAT), Juthamas Siriwan on Thursday afternoon. They are hoping to ask for cooperation from the Federal Bureau of Investigation to provide Thai police with more information on the case after Los Angeles police arrested Gerald Green, 75, and his wife, Patricia, 52, for violating the Foreign Corrupt Practices Act.

How do you make a case that someone has engaged in “foreign corrupt practices” without information from foreign persons about the corrupt practices in their foreign country? Without judicial cooperation, it seems like it might serve as a forum-shopping mechanism whereby one can make charges against persons in another country that the accused cannot answer in their own.

When the Manhattan DA indicted Paulo Salim Maluf, for example, it took some work by Brazilian authorities, who had to plead their case to Morgy and show that Maluf had committed crimes in New York. Have the Thai authorities made their case to the federal prosecutor in California? Reportedly not.

The Nation, and a number of other sources, shortly thereafter, reported:

Juthamas Siriwan, former governor of the Tourism Authority of Thailand, Thursday resigned as deputy leader and member of the Puea Pandin Party. Her resignation automatically disqualified [her] as the party’s party-list candidate.

Variety Asia:

Siriwan, the former governor of the Tourism Authority of Thailand and prexy of the fest, insisted that she had not accepted bribes but said she wanted to spare her political party any association with the scandal. She was deputy leader of the Puea Pandin Party, which was favored to win the largest share of Sunday’s vote but didn’t win an absolute majority.

No one has been convicted of bribery yet, of course.

How do such cases get made, anyway?

If the act occurs in a foreign jurisdiction (run by generalissimos who overthrew the prime minister who appointed the official in question)?

I am just curious because of the slight resemblance to the maleta case involving mountains of cash money, a shady Venezuelan who later turned up in Miami, and the (indignant) new president of Argentina: “¡Basura!

Let me see if I can get a copy of the complaint through the (infernally slow) PACER system, if if the case has been assigned.

Oh, wait: here is the FBI affidavit.

The charge was brought by unnamed “present and former associates” and a “confidential informant.”

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One of the firms allegedly set up to funnel commissions was called ConsultAsia Ltd, according to the affidavit.

Now, there happens to be this resume posted to the Internet by a certain YANICHNAT CHALERMTIARANA — it turned up in a simple Google search — who lists the following job experience:

From July 2004 to April of 2006, he says worked as Exports and International Affairs Manager for ConsultAsia Ltd.

Among his stated duties:

  • Promoted Bangkok Fashion City Project to global fashion industry by partnering with public relations companies from United States and Japan

Which public relations companies?

From October 2003 to April 2006, CHALERMTIARANA says he worked as an Administrative Officer in the office of the TAT governor, where among other things he says he

  • Developed a strategy to market local cultural events such as Bangkok International Film Festival, Water Festival (Songkran) to international tourism industry

Which would seem to suggest he worked for the government tourist authority and ConsultAsia Ltd. at the same time.

Which would kind of seem like either (1) a conflict of interest, or (2) possibly a function of some kind of public-private partership, either formal or ad hoc.

In other words, “it’s not a conflict of interest, it’s an innovation synergy!”

See also “It’s not a bug, it’s a feature!”

CHALERMTIARANA expects to receive his M.A. in Southeast Asia Studies from Johns Hopkins next year, he says. He lives in Washington, D.C.

Our FBI agent charges that the Governor and Greene were partners in ConsultAsia, as was, possibly, the Governor’s daughter.

Our John Hopkins scholar might be in a position to know about that.

Someone should e-mail the guy and ask him if he knows anything about the matter. He seems to be in a unique position to.


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