Criminal informations were filed today against three Fiat subsidiaries in U.S. District Court for the District of Columbia. Iveco S.p.A. (Iveco) and CNH Italia S.p.A. (CNH Italia) were each charged with one count of conspiracy to commit wire fraud and to violate the books and records provisions of the Foreign Corrupt Practices Act (FCPA). CNH France S.A. (CNH France) was charged with conspiracy to commit wire fraud.
Fiat has acknowledged responsibility for the actions of its three subsidiaries, Iveco, CNH Italia and CNH France, whose employees and agents made improper payments to the former Iraqi government in order to obtain contracts with Iraqi ministries to provide industrial pumps, gears and other equipment. The agreement requires the company and its subsidiaries to cooperate fully with the Justice Department’s ongoing Oil for Food investigation.
According to the agreement and the informations filed today, between 2000 and 2002, Iveco, CNH Italia and CNH France paid a total of approximately $4.4 million to the Iraqi government by inflating the price of contracts by 10 percent before submitting the contracts to the United Nations for approval, and concealed from the United Nations the fact that the price contained a kickback to the Iraqi government. Iveco and CNH Italia also inaccurately recorded the kickback payments as "commissions" and "service fees" for its agents in its books and records.
In recognition of Fiat’s thorough review of the illicit payments and its implementation of enhanced compliance policies and procedures, the Department has agreed to defer prosecution of criminal charges against Fiat and its three subsidiaries for a period of three years. If Fiat abides by the terms of the agreement, at the end of the three-year period the Department will dismiss the criminal informations against the subsidiaries.
The Oil for Food Program was established by the United Nations to enable Iraq to sell its oil for humanitarian purposes, in the context of an extensive international sanctions regime. The Oil for Food Program mandated that the proceeds of oil sales be deposited in a United Nations bank account and that those proceeds be used by the Iraqi government only to purchase humanitarian goods and services, such a food and medicine, approved by the United Nations. Beginning in 2000, the Iraqi government began requiring companies wishing to sell humanitarian goods to government ministries to pay a kickback, often mischaracterized as an "after sales services fee," to the government in order to be granted a contract. The amount of that fee was usually 10 percent of the contract price. Such payments were not permitted under the Oil for Food Program or other sanction regimes then in place.
In a related matter, Fiat reached a settlement today with the U.S. Securities and Exchange Commission (SEC) on a complaint and agreed to pay $3.6 million in civil penalties and $7,209,142 in disgorgement of profits, including pre-judgment interest, in connection with contracts for which its subsidiaries paid kickbacks to the Iraqi government.
The investigation of Iveco, CNH Italia and CNH France, and of
other humanitarian goods suppliers involved with the Oil for Food Program,
is being conducted by the Criminal Division’s Fraud Section and the FBI’s Washington Field Office. This case is being prosecuted by Fraud Section Trial Attorney Lori Weinstein.
To date, more than $24 million in penalties have been levied by the Department of Justice in cases involving the suppliers of humanitarian goods under the U.N. Oil for Food program.
The Department acknowledges and expresses its appreciation of
the significant assistance provided by the staff of SEC’s Enforcement Division in the ongoing Oil for Food investigation.
Tuesday, December 23, 2008
Saturday, December 13, 2008
The Justice Department has accused Siemens of making bribes and trying to falsify its corporate books from 2001 to 2007. It has also accused some of the conglomerate's subsidiaries of bribery, including paying kickbacks to the former Iraqi government to get some of the United Nations Oil-for Food contracts.
Siemens and its subsidiaries in Bangladesh, Venezuela and Argentina have agreed to plead guilty on Monday in U.S. District Court in Washington in front of Judge Richard J. Leon.
Siemens has agreed to pay $448.5 million in fines, with the three subsidiaries paying at least $500,000 each, according to court papers.
A spokeswoman for the U.S. division of Siemens had no immediate comment late Friday. The Justice Department also refused to comment.
Siemens, which makes everything from trains to light bulbs, was first rocked by claims of corruption in 2006. Evidence began to surface in 2007 and the company has since acknowledged dubious payments to secure business worth up to $1.7 billion around the world.
Tuesday, December 9, 2008
The request, which was the result of hours of private meetings among the detainees, appeared intended to undercut the government’s plan for a high-profile trial while drawing international attention to what some of the five men have said was a desire for martyrdom.
But the military judge, Col. Stephen R. Henley of the Army, said a number of legal questions about how the commissions are to deal with capital cases had to be resolved before guilty pleas could be accepted.
The case is likely to remain in limbo for weeks or months, presenting the Obama administration with a new issue involving detainees at the naval base at Guantánamo Bay to resolve when it takes office next month.
At the start of what had been listed as routine proceedings Monday, Judge Henley said he had received a written statement from the five men dated Nov. 4 saying they planned to stop filing legal motions and “to announce our confessions to plea in
Speaking in what has become a familiar high-pitched tone in the cavernous courtroom here, the most prominent of the five, Khalid Shaikh Mohammed, said, “we don’t want to waste our time with motions.”
“All of you are paid by the U.S. government,” continued Mr. Mohammed, who has described himself as the mastermind of the 2001 attacks. “I’m not trusting any American.”
Mr. Mohammed and the others presented their decision almost as a dare to the American government. When Judge Henley raised questions about the procedure for imposing the death penalty after a guilty plea, some of the detainees immediately suggested they might change their minds if they could not be assured they would be executed.
The announcement Monday sent shockwaves through the biggest case in the war crimes system here — the case for which some government officials say the system was expressly devised. With the case suddenly at a critical juncture, President-elect Barack Obama may find it more complicated to carry out his pledge to close the detention camp here.
. . .
In Monday’s session, which was covered by an international press corps from the Arab world, Spain, Brazil, Japan and elsewhere, Judge Henley directed prosecutors to submit full legal arguments by Jan. 4 on the procedures in capital cases outlined by the Military Commissions Act, which governs proceedings here.
Among other fundamental issues, Judge Henley asked for analysis of whether the men could be sentenced to death if they pleaded guilty instead of being found guilty by a panel of military officers. Because this week’s proceedings were to consider legal motions to be decided by the judge, no panel was present.
Another potential hurdle to guilty pleas was a claim by lawyers for two of the detainees that they may not be mentally competent to represent themselves.
The judge ruled that those two detainees could not make decisions about their cases on Monday. The two are Mr. bin al-Shibh and Mustafa al-Hawsawi, charged as a Qaeda financial operative. In addition to Mr. Mohammed, the other detainees are Walid bin Attash, who is accused of selecting many of the hijackers, and Ammar
al-Baluchi, a nephew of Mr. Mohammed who is said to have been one of his key deputies in the Sept. 11 plot.
The judge said the competency issues might not be resolved for a substantial period. The three detainees who are representing themselves said they would wait to enter a plea, as Mr. Mohammed put it, “until a decision is made about our brothers.”
The judge ruled that he would permit the three men who represent themselves to withdraw motions filed on their behalf, which would set the stage for a guilty plea.
O.J. Simpson is headed to prison for at least nine years, but a prosecutor says the former football star could have spent less time behind bars if he had accepted a plea deal before he was convicted.
Clark County District Attorney David Roger said Simpson was offered a deal for less prison time than the nine-to 33-year prison terms the graying former football star was sentenced to on Friday for kidnapping and assaulting two sports memorabilia dealers with a deadly weapon.
"Mr. Simpson wanted something just short of a public apology," Roger said. "We didn't think that was appropriate."
For an interesting discussion of the varying reports in the media regarding how many years Simpson actually received during sentencing last week, see here.
The Minnesota Court of Appeals on Tuesday rejected U.S. Sen. Larry Craig's effort to withdraw his guilty plea to a misdemeanor offense of disorderly conduct in connection with a sex-sting operation.
"Because we see no abuse of discretion in the denial and conclude that the statute is not overbroad, we affirm" a lower court's decision, the three-judge panel wrote in a 10-page ruling.
In a written statement, Craig said he was "extremely disappointed" by the action and was considering an appeal.
"I disagree with their conclusion and remain steadfast in my belief that nothing criminal or improper occurred at the Minneapolis airport," Craig said.
The Idaho Republican was arrested in the Minneapolis-St. Paul airport in June 2007 after an undercover police officer accused him of soliciting sex by using hand signals and tapping his foot in a bathroom stall. Two months after his arrest, and without consulting a lawyer, Craig pleaded guilty to the charge without appearing in
After the incident became public, he attempted to withdraw his plea, contending that his "wide stance" had been misinterpreted by the arresting officer and that he had pleaded guilty simply to get the matter over with.
. . .
And the judges denied Craig's assertion that he was entitled to withdraw his plea because he was the victim of entrapment.
They wrote that "failure to explore an entrapment defense has been found not to justify withdrawal of a guilty plea."
They cited a precedent ruling that said entrapment "exists only where the criminal intent originates in the enforcement officials of the government rather than in the mind of the accused."
Then, they added, "Here, the complaint clearly indicates that the criminal intent originated in the mind of appellant, not in the officer."
. . .
Craig initially said he would resign after the incident was reported in the news media, then decided to remain in the Senate and fight to have his guilty plea thrown out. But the three-term senator did not seek re-election this year and will retire when his term ends in January.