Top 10 International Anti-Corruption Developments for April 2021
Top 10 International Anti-Corruption Developments for April 2021
In order to provide an overview for busy in-house counsel and compliance professionals, we summarize below some of the most important international anti-corruption developments from the past month, with links to primary resources. This month we ask: Which company resolved foreign bribery charges in the United Kingdom? What did the former CEO of a New York Stock Exchange listed company plead guilty to in a New York federal court? What are the latest developments in the investigations of alleged corruption at the national oil companies in Ecuador and Venezuela? The answers to these questions and more are here in our April 2021 Top 10 list.
1. UK Subsidiary of Aircraft Manufacturer Pleads Guilty to Saudi Arabia Bribery Scheme. On April 28, 2021, the UK’s Serious Fraud Office (SFO) announced that GPT Special Project Management Ltd. (GPT), a former subsidiary of Airbus SE which ceased operations in April 2020, had pleaded guilty to one count of corruption, contrary to section 1 of the Prevention of Corruption Act 1906. According to the SFO, GPT paid bribes to win a £2 billion contract to provide military communications services to the Saudi Arabian National Guard. The company was ordered to pay a confiscation order of £20.6 million, a fine of £7.5 million, and the SFO’s costs of £2.2 million. The investigation into the company’s work in Saudi Arabia began in 2012. In July 2020, the SFO brought charges against the company and three individuals, who are due to face trials in May 2022. This also follows the separate $3.9 billion deferred prosecution agreement (DPA) entered into by Airbus SE with U.S., British, and French authorities in January 2020.
2. Former Brazilian Petrochemical Company CEO Pleads Guilty to Brazil Bribery Scheme. On April 15, 2021, the U.S. Department of Justice (DOJ) announced that former Braskem S.A. CEO Jose Carlos Grubisich had pleaded guilty in the Eastern District of New York to conspiring to violate the anti-bribery and books and records provisions of the Foreign Corrupt Practices Act (FCPA). According to the indictment, Grubisich and his co-conspirators engaged in a massive bribery scheme involving Braskem and its parent company that resulted in the diversion of approximately $250 million of Braskem’s funds into a secret slush fund, which was used to pay bribes to government officials, political parties, and others in Brazil. Grubisich admitted that, while he was CEO, he agreed to pay bribes to Brazilian government officials to ensure that the company would retain a contract for a significant petrochemical project from Brazil’s national oil company, Petroleo Brasileiro S.A. (“Petrobras”). Grubisich also admitted to agreeing to falsely record payments to offshore shell companies as payments for legitimate services. Grubisich faces up to 10 years in prison and has agreed to pay approximately $2.2 million in forfeiture. He is scheduled to be sentenced on August 5, 2021. In December 2016, Braskem reached related resolutions with DOJ and the Securities and Exchange Commission (SEC).
3. Former Barbados Official Sentenced for Laundering Bribe Payments. On April 27, 2021, DOJ announced that Donville Inniss, a former member of Parliament and Minister of Industry, International Business, Commerce, and Small Business Development in Barbados, had been sentenced to two years in prison, following his January 2020 conviction by a jury in the Eastern District of New York on several money laundering charges. Inniss was also ordered to forfeit approximately $36,000 in bribes he allegedly received from the Insurance Corporation of Barbados Limited (ICBL) in exchange for renewing contracts from the Barbados government to insure government property worth over $100 million. In July 2020, Inniss unsuccessfully tried to persuade the trial court to overturn his convictions.
4. Former Logistics Company Executive Sentenced for Scheme to Bribe a Russian Official. On April 30, 2021, Daren Condrey, former co-president of Maryland-based Transport Logistics International (TLI), was sentenced to two years in prison, three years of supervised release, and a fine of $12,500 following his June 2015 guilty plea in the District of Maryland to FCPA and wire fraud conspiracy charges. Condrey allegedly agreed to pay approximately $2 million to Vadim Mikerin, an official at a subsidiary of Russia’s state-owned uranium company, to secure contracts for TLI. DOJ announced guilty pleas by Condrey and Mikerin in August 2015. Condrey’s former co-president, Mark Lambert, was convicted following a jury trial in November 2019 and sentenced to four years’ imprisonment in October 2020. TLI resolved related charges with DOJ in March 2018.
5. Former Employee of Switzerland-Based Commodities Firm Pleads Guilty in Connection with Ecuador Bribery Scheme. On April 6, 2021, Raymond Kohut pleaded guilty in the Eastern District of New York to one count of conspiracy to launder the proceeds of a scheme to pay at least $22 million in bribes to officials at Ecuador’s national oil company, Empresa Pública de Hidrocarburos del Ecuador (“Petroecuador”). According to the Information, the officials caused Petroecuador to enter into a series of contracts with two Asian state-owned oil and gas entities (the “Asian SOEs”) under which the Asian SOEs provided loans to Petroecuador secured by oil to be delivered over a period of years. Kohut’s employer, an unnamed European energy trading company (reportedly Gunvor Group, Ltd.), then entered into agreements with the Asian SOEs to market and sell the oil products delivered under those contracts. Kohut’s employer allegedly paid fees to two consulting firms to generate the bribe money, some of which was transmitted through the U.S. banking system. Kohut faces up to 20 years in prison and has agreed to forfeit $2.2 million. (For more on the Petroecuador prosecutions, please see our April 2018, September 2018, November 2018, April 2019, October 2019, November 2019, December 2019, January 2020, February 2020, September 2020, and January 2021 Top 10s, as well as the stories below.)
6. Argentine National Sentenced for Ecuador Bribery Scheme. On April 16, 2021, Ramiro Andres Luque Flores was sentenced to four years of probation with six months of home confinement following his October 2017 guilty plea in the Eastern District of New York to FCPA and money laundering conspiracy charges. Luque was also ordered to pay a fine of $30,000. Luque allegedly paid bribes worth $3.2 million to Petroecuador officials to secure and retain approximately $38 million in oil and gas contracts for his hazardous waste disposal company, Galileo Energy SA. Luque’s cooperation with the government and probationary sentences for other cooperators factored into Luque’s sentence.
7. Ecuadorian Business Executive Sentenced for Bribery at Ecuadorian State-Owned Surety Company. On April 26, 2021, Roberto Heinert was sentenced to three years in prison and three years of supervised release following his guilty plea in the Southern District of Florida to one count of conspiracy to commit money laundering in connection with a $3 million bribery scheme involving officials at Seguros Sucre S.A., Ecuador’s state-owned surety company. According to prosecutors, Heinert and his business partner, José Vicente Gómez Avilés, assisted Felipe Moncaleano Botero, the former CEO of a UK reinsurance company’s Colombian subsidiary, in paying bribes to the chairman of Seguros Sucre, Juan Ribas Domenech, to retain a reinsurance contract between the UK reinsurance company and Ecuador’s Ministry of Defense. In March 2021, both Gómez and Ribas received prison terms for related conspiracy charges.
8. Venezuelan Business Executive Pleads Guilty to Conspiracy to Commit Money Laundering. On April 19, 2021, Carlos Enrique Urbano Fermin pleaded guilty in the Southern District of Florida to one count of conspiracy to commit money laundering in connection with a scheme to bribe a Venezuelan prosecutor not to prosecute his companies, which had won several large contracts from three subsidiaries of Venezuela’s national oil company Petróleos de Venezuela SA (PDVSA). According to the Information and factual proffer, $1 million in bribe payments was wired in or from the United States, including a $100,000 wire transfer from Fermin’s U.S. bank account to a bank account in Coral Gables, Florida, held by an intermediary who had a relationship with the prosecutor and described himself as an “insurance policy” against the charges. Fermin is scheduled to be sentenced on September 3, 2021. (For more on PDVSA-related prosecutions, please see our October 2017, May 2019, February 2020, August 2020, September 2020, November 2020, and January 2021 Top 10s, as well as the stories below.)
9. Former Venezuelan State-Owned Oil Company General Counsel Sentenced for Laundering Bribe Payments. On April 21, 2021, Edoardo Orsoni, a former general counsel at PDVSA, was sentenced in the Southern District of Florida to three years’ probation following his August 2020 guilty plea to one count of conspiracy to commit money laundering in connection with an alleged PDVSA joint venture bribery scheme. Orsoni and Lennys Rangel, a former procurement chief of Petrocedeño (a joint venture between PDVSA and two European oil companies), allegedly received bribes from various contractors to secure contracts with the joint venture. Prosecutors said that Orsoni provided substantial assistance to the government investigation and prosecution of others.
10. Miami-Based Business Executive Sentenced for Venezuela Bribery Scheme. On April 30, 2021, Gustavo Adolfo Hernandez Frieri was sentenced to 46 months in prison, three years supervised release, and a $50,000 fine following his November 2019 guilty plea in the Southern District of Florida to one count of conspiracy to commit money laundering in connection with an alleged conspiracy to embezzle $1.2 billion from PDVSA. DOJ announced Hernandez’s arrest in July 2018. According to prosecutors, Hernandez allowed PDVSA’s former finance director, Abraham Edgardo Ortega, to launder $12 million in bribes through his financial advisory firm, Global Securities Advisors LLC. Ortega pleaded guilty in October 2018.
 United States v. Daren Condrey, No. 8:15-CR-336-TDC, ECF No. 99, 101 (D. Md. Apr. 30, 2021).
 United States v. Ramiro Andres Luque-Flores, No. 1:17-cr-00537-CBA (E.D.N.Y. Apr. 16, 2021).
 United States v. Roberto Heinert, No. 1:20-cr-20187-RNS, ECF No. 59, 60 (S.D. Fla. Apr. 26, 2021).
 United States v. Edoardo Orsoni, No. 19-CR-20725-MGC, ECF No. 46, 47 (S.D. Fla. Apr. 21, 2021).
 United States v. Gustavo Adolfo Hernandez Frieri, No. 18-CR-20685-KMW, ECF No. 388 (S.D. Fla. Apr. 30, 2021).