Panasonic Avionics Corporation Agrees to Pay $137 Million to Resolve Foreign Corrupt Practices Act Charges

On April 30, 2018, DOJ officials announced that Panasonic Avionics Corp. (“PAC”), a subsidiary of publicly traded Panasonic Corporation (“Panasonic”), agreed to pay a $137 million criminal penalty under a deferred prosecution agreement to resolve FCPA liability.  According to the agreement, PAC caused parent Panasonic to falsify its books and records with respect to improper payments that PAC made to third-party consultants and sales agents, in violation of the FCPA’s accounting provisions.  In addition to ... Continue Reading

Former Venezuelan Official Pleads Guilty to Money Laundering Charge in Connection with Bribery Scheme

On April 19, 2018, Cesar David Rincon Godoy, a former general manager of the procurement subsidiary of Venezuelan state-owned energy company Petroleos de Venezuela S.A. (“PDVSA”), pleaded guilty to one count of conspiracy to commit money laundering.  The charge stemmed from an alleged scheme involving the payment of bribes by the owners of U.S.-based companies to Venezuelan government officials to secure contracts with PDVSA and payment priority on outstanding invoices.  According to admissions made in ... Continue Reading

Cambridge, Massachusetts Man Sentenced in Manhattan Federal Court for Insider Trading

On March 30, 2018, Fei Yan, a post-doctoral associate at a university located in Cambridge, Massachusetts, was sentenced to 15 months in prison for insider trading.  Yan’s spouse worked at an international law firm where she learned material nonpublic information concerning the acquisition of Stillwater Mining Company, a publicly traded company whose shares are listed on the New York Stock Exchange.  According to court filings, while his spouse was working on the potential merger, Yan ... Continue Reading

Yevgeniy Nikulin Appears in U.S. Court Following Extradition

On March 30, 2018, a Russian national charged with illegally accessing and stealing data from the computers of LinkedIn, DropBox, and Formspring made his initial appearance in federal court, following his extradition from the Czech Republic.  The defendant, Yevgeniy Aleksandrovich Nikulin, had been indicted for the crimes in 2016 and was detained on an international warrant. United States v. Nikulin, 16-cr-00440 (N.D. Cal.)

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Barclays Agrees to Pay $2 Billion in Civil Penalties to Resolve Claims for Fraud in the Sale of Residential Mortgage-Backed Securities

On March 29, 2018, officials announced that Barclays Capital, Inc. and several of its affiliates agreed to settle a civil action brought in December 2016 in relation to the underwriting and issuance of residential mortgage-backed securities (“RMBS”) between 2005 and 2007.  Barclays agreed to pay $2 billion in civil penalties in exchange for dismissal of the government’s amended complaint.  The complaint alleged that Barclays misled investors about the quality of underlying mortgage loans in 36 ... Continue Reading

Indictment Charges Nine Iranian Citizens with Massive Cyber Theft of Documents and Data on Behalf of Iranian Government

On March 23, 2018, an indictment was unsealed charging nine Iranian citizens, all affiliated with the Iran-based Mabna Institute, with involvement in a coordinated campaign to steal intellectual property and academic data from a variety of U.S. and foreign targets.  The indictment alleged that, in total, the defendants stole more than 31 terabytes of material from targets that included universities, private sector companies, the U.S. Department of Labor, and the United Nations Children’s Fund.  Many ... Continue Reading

Iranian Citizen Charged with Involvement in Scheme to Avoid U.S. Economic Sanctions Against Iran by Funneling $115 Million from Venezuela Through U.S. Banks

On March 20, 2018, an indictment was unsealed alleging that Ali Sadr Hashemi Nejad, an Iranian citizen, evaded U.S. sanctions by funneling his company’s proceeds from a Venezuelan infrastructure project through the U.S. financial system.  According to the indictment, Nejad and a co-conspirator used false passports to incorporate entities in Switzerland and Turkey and to set up U.S.-dollar bank accounts for these entities in Switzerland.  By concealing the Iranian nexus to the payments, Nejad was ... Continue Reading

Former Siemens Executive Pleads Guilty to Involvement in $100 Million Bribery of Argentine Government Officials

On March 15, 2018, Eberhard Reichart, the former Technical Manager of Siemens Business Services’ Major Projects division, pleaded guilty to one count of conspiracy to bribe Argentine government officials.  According to court documents, Reichert was involved in a decades-long scheme to pay tens of millions of dollars in bribes to the Argentine officials in order to secure a contract to create national identity cards.  To effectuate payment of the bribes, Reichert and his co-conspirators created ... Continue Reading

Chief Executive and Four Associates Indicted for Conspiring with Global Drug Traffickers by Providing Encryption Services to Evade Law Enforcement and Obstruct Justice

On March 15, 2018, officials announced the indictment of the CEO of Canada-based encrypted communication device and services Phantom Secure, along with four associates, on charges of racketeering conspiracy and narcotics distribution conspiracy.  According to court documents, Phantom Secure advertised its devices and services as impervious to decryption, wiretapping, or legal records requests, and guaranteed that the company would remotely destroy evidence contained on customer devices in the event of compromise by informants or law ... Continue Reading

Transport Logistics International Inc. Agrees to Pay $2 Million Penalty to Resolve Foreign Bribery Case

On March 13, 2018, federal officials announced that they had resolved FCPA charges through a deferred-prosecution agreement (“DPA”) against a Maryland-based nuclear material transportation company.  According to court documents, Transport Logistics International, Inc. (“TLI”) conspired with others to pay more than $1.7 million in bribes to an official of Russian state-owned JSC Techsnabexport to secure improper business advantages and obtain or retain business.  TLI executives reportedly caused fake invoices to be prepared to create the ... Continue Reading

Martin Shkreli Sentenced to Seven Years’ Imprisonment for Multimillion-Dollar Fraud Scheme

On March 8, 2018, Martin Shkreli was sentenced to seven years’ imprisonment for committing securities fraud and securities fraud conspiracy.  A jury found that Shkreli, a former hedge fund manager and CEO of the biopharmaceutical company Retrophin Inc., made false representations and omissions to defraud investors.  Shkreli was also convicted, alongside former Retrophin outside counsel Evan Greebel, of illegally attempting to control the price and trading volume of Retrophin’s stock.  In addition to his prison ... Continue Reading

Deputy Attorney General Rosenstein Delivers Remarks at the 32nd Annual ABA National Institute on White Collar Crime

On March 2, 2018, Deputy Attorney General Rod Rosenstein delivered the keynote address at the American Bar Association’s National Institute on White Collar Crime, highlighting recent convictions, resolutions, and areas of focus for the DOJ.  In his prepared remarks, Rosenstein noted that the current administration was not relaxing its enforcement efforts targeting white collar crime, but added that DOJ will seek to “avoid imposing penalties that disproportionately punish innocent employees, shareholders, customers, and other stakeholders.” ... Continue Reading

Deputy Associate Attorney General Stephen Cox Delivers Remarks at the Federal Bar Association Qui Tam Conference

On February 28, 2018, Deputy Associate Attorney General Stephen Cox delivered remarks on DOJ’s False Claims Act (“FCA”) enforcement efforts at the Federal Bar Association’s Qui Tam Conference.  Cox reported that the Department recovered more than $3.4 billion for the United States in Fiscal Year 2017 under the FCA and emphasized that while there are many FCA cases that DOJ can pursue, it is seeking to avoid “regulation by enforcement.”  Cox discussed recent DOJ regulatory ... Continue Reading

False Claims Act Complaint Charges Pharmacy, Two Pharmacy Executives, and Private Equity Firm with Participation in Kickback Scheme

On February 23, 2018, DOJ announced that it was intervening in an FCA suit brought by two former employees against a Florida pharmacy, Diabetic Care Rx LLC, doing business as Patient Care America.  DOJ’s complaint in intervention alleges that the pharmacy paid illegal kickbacks to induce prescriptions for drugs reimbursed by TRICARE, a federally funded health care program for members of the military and their families.  Two pharmacy executives were also named in the complaint, ... Continue Reading

Former CEO of Tech Company Pleads Guilty to Insider Trading

On February 21, 2018, Peter C. Chang, the former President and CEO of Directors of Alliance Fiber Optic Products (“AFOP”), pleaded guilty to insider trading and tender offer fraud.  AFOP, which is publicly traded on the NASDAQ, is a manufacturer of fiber optic components.  As part of his guilty plea, Chang admitted that he traded AFOP stock through brokerage accounts in the names of his wife and brother sold AFOP stock before two public announcements ... Continue Reading