Articles Posted in bribe

Ng Chong Hwa,known as “Roger Ng,” a citizen of Malaysia, has been extradited to the United States from Malaysia to face charges of conspiring to launder billions of dollars embezzled from 1Malaysia Development Berhad (1MDB), Malaysia’s investment development fund, conspiring to violate the Foreign Corrupt Practices Act (FCPA) by paying bribes to multiple government officials in Malaysia and Abu Dhabi, and conspiring to violate the FCPA by circumventing the internal accounting controls of a major New York-headquartered financial institution (Financial Institution). In a three-count indictment unsealed last year, Ng, was charged with crimes he allegedly committed while employed as a Managing Director at the Financial Institution, which underwrote more than $6 billion in bonds issued by 1MDB in three separate bond offerings in 2012 and 2013.  Ng was arrested in Malaysia on November 1, 2018, pursuant to a provisional arrest warrant issued at the request of the United States, later waived extradition to the United States, and is scheduled to be arraigned today before U.S. Magistrate Judge Peggy Kuo in federal court in Brooklyn, New York.

As set forth in the indictment, between approximately 2009 and 2014, Ng conspired with others to launder billions of dollars misappropriated and fraudulently diverted from 1MDB, including funds 1MDB raised in 2012 and 2013 through three bond transactions it executed with the Financial Institution.  As part of the scheme, Ng and others conspired to bribe government officials in Malaysia and Abu Dhabi to obtain and retain lucrative business for the Financial Institution, including the 2012 and 2013 bond deals.  They also conspired to launder the proceeds of their criminal conduct through the U.S. financial system by funding major Hollywood films and purchasing, among other things, artwork from a New York-based auction house and luxury residential real estate in New York City and elsewhere.

As alleged, Ng, co-defendant Low Taek Jho (also known as “Jho Low”), and their co-conspirators used Low’s close relationships with high-ranking government officials in Malaysia and Abu Dhabi to obtain and retain business for the Financial Institution through the promise and payment of hundreds of millions of dollars in bribes.  In the course of executing the scheme, Ng and others at the Financial Institution conspired to circumvent the Financial Institution’s internal accounting controls. Through its work for 1MDB during that time, the Financial Institution received approximately $600 million in fees and revenues along with increased reputational prestige.  At the same time, Ng and other co-conspirators at the Financial Institution received large bonuses and enhanced their own reputations at the Financial Institution.  In total, Ng and the other co-conspirators misappropriated more than $2.7 billion from 1MDB.  Low remains at large.

 

 

Australia whistleblower lawsThose looking to report corruption, fraud, tax evasion, and other forms of misconduct in the corporate world can finally get the protection they deserve as new whistleblower laws in Australia clear federal parliament.

Corporate whistleblower laws introduced in late 2017 have managed to pass the lower house in early 2019. These laws put into place offer greater protection for anyone wishing to voice concerns about fraudulent activities within a division of the corporate world.

Corporate crime is an illegal act that is committed by a company or business with the goal of giving the company a boost or advantage they normally would be unable to receive. Examples of this are all over the world and are committed by even some of the best-known brands. Many in the U.S. may even recall back in 2014 when Rite Aid, one of the largest drug stores, was required to pay almost 3 billion for violating the False Claims Act by allegedly using gift cards to sway those on Medicare and Medicaid to switch their prescriptions to their pharmacies. This would be considered an act of bribery, and one of the many types of corporate crime. Corporate crime has cost many countries a considerable amount, and so whistleblowers, those who have set out to inform others about illicit activity, are one of the best defenses we have to fight against this type of crime.

briberyFCPA is Being Encouraged to Fight Foreign Bribery

The US Justice Department is apparently bulking up its anti-foreign bribery program.  According to HETQ, the US plans to expand benefits for companies who report on any acts of foreign bribery their employees may have committed.  Deputy Attorney General Rod Rosenstein announced the new policy at the 34th International Conference on the FCPA in Maryland.

The FCPA

There is a constant drumbeat of daily news about Russia and investigations of possible collusion to fix the election. Also,  following the release of the “Panama Papers” stories about Russian corruption and offshore moneys leading  to friends of Vladimir Putin added to the fuel of interest in the Russian way of business. As a result, independent Counsel Robert Mueller will have lots of leads from the information previously released by the investigative media which may connect to his  investigation of meetings by election officials with Russian representatives.

Interestingly, a large number of U.S. companies not only still do business in Russia, but they own subsidiary companies there and those companies are doing quite well. However, a look at cases investigated and settled by either the Securities and Exchange Commission (SEC) or the Department of Justice (DOJ) reveals that many of the companies doing business in Russia are settling cases alleging that they have been paying substantial bribes to government officials in violation of the Foreign Corrupt Practices Act (FCPA). Also, there is another trend and that is that whistleblowers, seeking the allowed 15-30% reward of what the U.S. recovers are bringing forth cases under the False Claims Act (FCA) allowing for citizens or non-citizens to file cases on behalf of the government when they reveal new info not known by the Government. Because the whistleblowers are insiders with detailed information, often presenting supportive emails and document to corroborate their cases, the fact of cases alleging bribes to Russian officials is no longer uncommon.

What companies have settled such cases in recent years?

Defense and government contracting company IAP Worldwide Services  will pay a $7.1 million penalty and entered into a non-prosecution agreement with the Department of Justice to end a government investigation into whether the company bribed Kuwaiti officials to secure a government contract.

James Michael Rama, a former vice president of IAP, also pleaded guilty before U.S. District Court Judge James Cacheris of the Eastern District of Virginia to one count of conspiracy to violate the anti-bribery provisions of the FCPA for his involvement in the bribery scheme. His sentencing will take place on Sept. 11.

In 2004, Kuwait’s Ministry of the Interior (MOI) initiated the Kuwait Security Program (KSP), a project intended to provide nationwide surveillance capabilities for several Kuwaiti government agencies primarily through the use of closed-circuit television. The project was divided into two phases: a planning and feasibility period called “Phase I” and an installation period called “Phase II.”

A former top executive at Volkswagen China  was sentenced to life in prison for accepting $42 million in bribes, state media reported.

Shi Tao, former deputy general manager of FAW-Volkswagen Sales Co, was convicted for taking 33 million yuan (H$42 million ) in bribes, the state-owned Shanghai Daily reported.

Shi helped advertisers and car dealers obtain business orders from FAW-Volkswagen in exchange for the bribes, the newspaper said.

Stryker Corporation, a major manufacturer of medical devices will pay more than $13.2 million to resolve charges of violating the Foreign Corrupt Practices Act for paying bribes to foreign officials in Argentina, Greece, Mexico, Poland and Romania.

The bribes were paid in order to obtain approximately $7.5 million in gains.

The moneys were apparently paid by Stryker’s foreign subsidiaries in those nations, which does not diminish the culpability of corporations here to the anti-bribe laws which are now being more stringently enforced by the Securities and Exchange Commission(SEC).

Canada is number one and the U.S. number two on the World Bank’s list of firms blacklisted from bidding on it’s global projects under its fraud and corruption policy. A lot of the information obtained about the fraud, especially foreign bribes is now coming from highly placed whistleblowers seeking rewards from the newly enhanced Securities and Exchange whistleblower program in the U.S.

The majority of the Canadian companies on the blacklist came as a result of an investigation into the Montreal-based engineering and construction company SNC-Lavalin. The firm and it’s affiliates were debarred in April 2103 for ten years as part of a settlement and that meant that 115 Canadian firms were blacklisted.

The United States had the second largest number with 44 companies on the debarment list, several SNC-Lavalin companies.

There are media reports circulating that Saudi Arabia has offered Russia to purchase $15 billion in arms as well as render oil and gas concessions if Russia will withdraw its support of Syria’s present regime. The reports refer to a meeting between Russian President Vladimir Putin and head of Saudi Intelligence Prince Bandar bin sultan at Mr. Putin’s Novo Ogaryovo dacha outside Moscow.

In stories leaked to the media, Prince Bandar offered Putin generous contracts to buy tanks, attack helicopters and other weapons in return for Russia’s agreement to scale down its support for Assad and also an agreement not to veto any more UN Security Council resolutions relating to Syria. The Kremlin has denied the stories.

Russia and Saudi Arabia are the world’s number one and two oil producers. Both nations have a strong interest in the assurance of a stable market and both would be damaged if the Syrian civil war expanded to other nations.