Former KPMG Executive And Former PCAOB Employee Convicted of Wire Fraud

On March 11, 2019, a jury convicted David Middendorf, the former National Managing Partner for audit quality at KPMG LLP (“KPMG”), and Jeffrey Wada, a former employee of the Public Company Accounting Oversight Board (“PCAOB”), of wire fraud charges in connection with a scheme to use confidential PCAOB materials to improve KPMG’s performance on PCAOB inspections.  At trial, the government asserted that, beginning in fall 2015, Wada—an inspections leader at the PCAOB—began passing confidential information
Continue Reading

Mozambique’s Former Finance Minister Indicted Alongside Other Former Mozambican Officials, Business Executives, and Investment Bankers in Alleged $2 Billion Fraud and Money Laundering Scheme that Victimized U.S. Investors

On March 7, 2019, a four-count indictment was unsealed charging three former senior Mozambican government officials, investment bankers, and business executives in connection with a $2 billion fraud and money laundering scheme.  According to the indictment, between 2013 and 2016 the defendants organized loans made to entities controlled by the Mozambican government.  The defendants allegedly defrauded U.S. investors by misrepresenting the purpose of the loans and the ability of Mozambique and its state-owned entities to
Continue Reading

Deputy Attorney General Rod Rosenstein and Assistant Attorney General Brian A. Benczkowski Deliver Remarks on Corporate Enforcement Policies

Outgoing Deputy Attorney General Rod Rosenstein and Assistant Attorney General Brian A. Benczkowski both delivered public remarks in early March that touched upon familiar themes in relation to FCPA enforcement and corporate prosecutions more generally.  These themes included the front-line role that companies play in detecting and preventing corruption through robust compliance programs; changes made to DOJ’s “anti-piling-on” and corporate compliance monitor policies; and recent efforts by DOJ to increase transparency in its enforcement policies. 
Continue Reading

Mobile TeleSystems PJSC and Its Uzbek Subsidiary Enter into Resolutions of $850 Million with the Department of Justice for Paying Bribes in Uzbekistan

On February 22, 2019, Mobile TeleSystems PJSC (“MTS”), the largest mobile telecommunications company in Russia and an issuer of publicly traded securities in the United States, and its wholly owned Uzbek subsidiary, Kolorit Dizayn Ink LLC (“Kolorit”), entered a deferred prosecution agreement and guilty plea, respectively, to resolve charges based on their roles in a scheme to pay bribes in Uzbekistan.  In total, the entities agreed to pay a penalty of $850 million.

The entities
Continue Reading

Former President and Former Chief Legal Officer of Publicly Traded Fortune 200 Technology Services Company Indicted in Connection with Alleged Multimillion Dollar Foreign Bribery Scheme

On February 14, 2019, a federal grand jury returned an indictment charging two former officers of Cognizant Technology Solutions Corporation (“Cognizant”), a publicly traded Fortune 200 technology services company, in connection with a foreign bribery scheme.  The indictment alleged that, in April 2014, the two officers—the company’s former president and chief legal officer—authorized a $2 million payment to government officials in India to obtain the permit necessary to open a new office campus.  The individuals,
Continue Reading

Chinese Telecommunications Conglomerate, Affiliates, and CFO Indicted in Separate Alleged Fraud Schemes

On January 28, 2019, indictments were unsealed in Seattle and Brooklyn against Chinese telecommunications conglomerate Huawei Technologies Co. Ltd., a number of Huawei affiliates (collectively, “Huawei”), and Huawei’s CFO in connection with two separate alleged fraud schemes.  The indictment in Seattle charged two Huawei affiliates with theft of trade secrets, attempted theft of trade secrets, wire fraud, and obstruction of justice.  According to the indictment, between 2012 and 2014, Huawei undertook concerted, company-wide efforts to
Continue Reading

Two Ukrainian Nationals Indicted in Computer Hacking and Securities Fraud Scheme Targeting U.S. Securities and Exchange Commission

On January 15, 2019, DOJ unsealed indictments charging two Ukrainian individuals with conspiring to hack into the SEC’s computer systems and profit by trading on critical information they stole.  The indictment alleges that, between February 2016 and March 2017, defendants hacked into the SEC’s Electronic Data Gathering, Analysis and Retrieval (EDGAR) system and stole thousands of files, including annual and quarterly earnings reports containing confidential, nonpublic, financial information, which the SEC requires publicly traded companies
Continue Reading

IAV GmbH to Pay $35 Million Criminal Fine in Guilty Plea for Its Role in Emissions Issues

On December 18, 2018, officials announced that Germany-based automotive system maker IAV GmbH  (“IAV”) has agreed to plead guilty to one felony count and pay a $35 million criminal penalty in connection with its role in Volkswagen AG’s (“VW’s”) use of so-called “defeat device” software to improve performance on U.S. emissions tests.  According to court filings, starting in 2006, IAV worked with VW to design, test, and implement this software in VW- and Audi-branded diesel
Continue Reading

Former Head of Organization Backed by Chinese Energy Conglomerate Convicted of International Bribery, Money Laundering Offenses

On December 5, 2018, a federal jury in New York convicted the head of a Hong Kong- and Virginia-based nongovernmental organization on seven criminal counts for his participation in a multi-year, multimillion-dollar scheme to bribe top officials of Chad and Uganda to secure business advantages for a Chinese oil and gas conglomerate.  According to trial evidence and court documents, the defendant, Chi Ping Patrick Ho, was involved in two schemes: offering a $2 million bribe
Continue Reading

Four Defendants Charged in Panama Papers Investigation for Their Roles in Panamanian-Based Global Law Firm’s Decades-Long Scheme to Defraud the United States

On December 4, 2018, four individuals were charged with wire fraud, tax fraud, money laundering, and other counts in connection with a criminal scheme involving Mossack Fonseca & Co. (“Mossack Fonseca”), a Panamanian law firm.  According to the indictment, from 2000 through 2017, the defendants conspired with others to help U.S. taxpayers and clients of Mossack Fonseca to conceal assets from the IRS through fraudulent means.  These individuals allegedly used sham foundations and shell companies
Continue Reading

Deputy Attorney General Rod J. Rosenstein Delivers Remarks at the American Conference Institute’s 35th International Conference on the Foreign Corrupt Practices Act

On November 29, 2018, Deputy Attorney General Rod Rosenstein clarified several aspects of the DOJ’s corporate cooperation and resolution policies in remarks at the American Conference Institute’s 35th International Conference on the Foreign Corrupt Practices Act.  With respect to cooperation credit, Rosenstein acknowledged that, when the government alleges criminal conduct that continued at the company over a long period of time, it may not be reasonable or practical to require companies to identify every employee
Continue Reading

Venezuelan Billionaire News Network Owner, Former Venezuelan National Treasurer, and Former Owner of Dominican Republic Bank Charged in Money-Laundering Conspiracy Involving over $1 Billion in Bribes

On November 20, 2018, a Venezuelan billionaire who owns the Globovision news network was charged for his alleged role in a billion-dollar currency exchange and money-laundering scheme.  On the same day, a former Venezuelan national treasurer and former owner of Dominican Republic-based Banco Peravia pleaded guilty to charges for their roles in the scheme.  The charges involve a scheme to pay and receive bribes in exchange for the right to conduct foreign exchange transactions on
Continue Reading

MoneyGram International Inc. Agrees to Extend Deferred Prosecution Agreement, Forfeits $125 Million in Settlement with Justice Department and Federal Trade Commission

On November 8, 2018, officials announced that money services business MoneyGram International, Inc. (“MoneyGram”) had breached a 2012 deferred prosecution agreement (“DPA”) with DOJ in relation to its anti-fraud and anti-money laundering (“AML”) programs.  MoneyGram was charged in November 2012 with failing to maintain an effective AML program and aiding and abetting wire fraud, after MoneyGram agents and others engaged in fraud schemes through the company’s payment systems.  At the time, DOJ agreed to defer
Continue Reading

Malaysian Financier and Former Banker Indicted for Conspiring to Launder Billions of Dollars in Illegal Proceeds and to Pay Hundreds of Millions of Dollars in Bribes

On November 1, 2018, an indictment was unsealed charging two individuals with conspiring to violate the FCPA and to launder billions of dollars embezzled from Malaysia’s investment development fund, 1Malaysia Development Berhad (“1MDB”), between approximately 2009 and 2014.  The first individual, known as “Jho Low,” is a Malaysian financier, while the other, known as “Roger Ng,” is a former managing director at a New York-based financial institution (the “Financial Institution”).  On the same day that
Continue Reading

Former Executive Director at Venezuelan State-Owned Oil Company, Petroleos De Venezuela, S.A., Pleads Guilty to Role in Billion-Dollar Money Laundering Conspiracy

On October 31, 2018, a former executive director at the Venezuelan state-owned oil company, Petróleos de Venezuela, S.A. (“PDVSA”), pleaded guilty to one count of conspiracy to commit money laundering for his role in a billion-dollar international scheme to launder funds embezzled from PDVSA.  Abraham Edgardo Ortega, who was PDVSA’s Executive Director of Financial Planning, admitted as part of his plea that in his position with PDVSA, he accepted $5 million in bribes to give
Continue Reading

LexBlog