On Friday, August 5, 2011, a Florida jury convicted Joel Esquenazi and Carlos Rodriguez, former executives of Terra Telecommunications Corporation, for their roles in a conspiracy to violate the FCPA and commit money laundering. U.S. v. Esquenazi, Case No. 09-cr-21010 (S.D. Fla. Filed Dec. 4, 2009), The convictions were the latest event in Government’s aggressive prosecution of FCPA violations for bribes paid to Telecommunications D’Haiti S.A.M. ("Haiti Teleco"), a state-owned telecommunications company in Haiti.
The case has been closely watched in FCPA circles because the Government not only pursued Mr. Esquenazi, President of Terra, and Mr. Rodriguez, an Executive Vice President of Terra, but also two employees of Haiti Teleco, Robert Antoine, director of international relations and Jean Rene Duperval, the subsequent director of international relations. The Government had also indicted Marguerite Grandison, the sister of Mr. Duperval, who was President of Telecom Consulting Services, Corp., a Florida corporation, through which payments were made in violation of the FCPA.
In his defense, Mr. Esquenazi raised the issue of whether payments to a employees of state-owned companies constituted a violation of the FCPA. The Government claimed Messrs. Antoine and Duperval were "foreign officials" and the Court agreed, denying the motion to dismiss: "The plain language of this statute and the plain meaning of this term show that as the facts are alleged in the indictment Haiti Teleco could be an instrumentality of the Haitian government." The same issue has been raised in other cases this year, as discussed here and here.
Another issue which arose in the case is that, while the Government cannot charge foreign officials with violations of the FCPA or conspiring to violate the Act (see, e.g., U.S. v. Blondek, 741 F. Supp. 116, 120 (N.D. Tex. 1990), aff’d sub. nom., U.S. v. Castle, 925 F.2d 831 (5th Cir. 1991)), the prosecution pursued Messrs. Antoine and Duperval by indicting them for offenses relating to money laundering in connection with the bribes. Mr. Antoine subsequently pled guilty to conspiracy to commit money laundering, admitting that between May 2001 to April 2003 he accepted bribes from U.S. telecommunications companies and he laundered those through intermediary companies. In June 2010, he was sentenced to 48 months in prison.
Messrs. Esquenazi and Rodriguez will probably be joining Mr. Antoine in prison. Following a two-and-a-half week trial, the pair were convicted of one count of conspiracy to violate the FCPA, seven counts of violating the FCPA, one count of conspiring to commit money laundering and 12 counts of money laundering. The jury convicted the pair after only five hours of deliberation.
Following Friday’s verdict, Assistant Attorney General Lanny Breuer stated: "This verdict is another powerful example that bribery of government officials – whether at home or abroad – has serious consequences. In finding the defendants guilty on all charged counts, the jury sent an unmistakable message that paying off foreign officials does not, in fact, pay off."
Others ensnared in the Government’s close enforcement of the statute include the defendants in: U.S. v. Fourcand, No. 10-cr-20062 (S.D. Fla.) (Jean Fourcand pled guilty to a one-count information alleging money laundering in connection with the bribes paid to Mr. Antoine); U.S. v. Diaz, No. 09-cr-20346 (S.D. Fla.) (Juan Diaz pled guilty to a one-count information charging him with conspiring to violate the FCPA); and U.S. v. Perez, No. 09-cr-20347 (S.D. Fla.) (Antonio Perez also pled guilty to a one-count information charging him with conspiring to violate the FCPA).