FCPA Fugitives

by Michael Volkov

fugitive2The FCPA has broad extraterritorial reach. Everyone knows that and understands how foreign conduct can be prosecuted in the United States courts.

FCPA violators, however, are learning about the long-arm of the law and the United States government’s ability to apprehend suspected criminals around the globe.

The recent guilty plea of Bernd Kowalewski, the former CEO of BizJet, should be an important reminder. Kowalewski was arrested in Amsterdam in March of 2014, and he plead guilty to one count of conspiracy and one substantive count of an FCPA violation.

The BizJet case stands as one of the most impressive prosecutions conducted by the Justice Department, not for its size ($11.8 million fine) but for the sheer tenacity of DOJ to pursue and convict FCPA criminals.

The BizJet case was the result of a voluntary disclosure by the company, coupled with extraordinary cooperation, culminating in a deferred prosecution of BizJet and a non-prosecution of its parent company, Lufthansa.fugitive

Four executives from BizJet were indicted and their indictments were placed under seal. Two executives plead guilty and cooperated. One of the executives sought to record conversations and/or assist in the apprehension of the two remaining executives. Both of these cooperating executives received significant reductions resulting in no jail time.

Kowalewski was apprehended and waived extradition. One defendant, Jaid Jensen, remains at large. In time, he will be apprehended.

FCPA fugitives are always at risk of being apprehended, unless they retire and avoid travel. The US government is very effective at tracking down criminals and bringing them back to face charges.

DOJ apprehended an Alstom executive with a sealed indictment when the executive sought to enter the United States. Even outside the United States, however, DOJ relies on other countries to assist in catching FCPA fugitives.

DOJ often files a red notice that INTERPOL sends to all member states to locate and arrest a fugitive. A red notice is quickly circulated among countries and can be triggered when the suspect seeks to enter a new country.

DOJ also maintains border alerts to apprehend the individuals when they are in the United States, even in one case apprehending a fugitive at a Los Angeles stopover on his way to Mexico. Growing cooperation in this area means that foreign violators will not escape prosecution.

fugitive3DOJ has used these same tactics in pursuing global cartels and apprehending executives for antitrust violations. In April, DOJ successfully extradited an Italian national and former executive to the United States to face criminal antitrust charges. In that same investigation, seven executives were arrested on sealed indictments while in Houston for an industry conference.

DOJ has experienced frustrations in two high-profile cases: Victor Kozeny remains in the Bahamas despite US attempts to extradite him to face FCPA (and other) charges. In addition, James Tillery, a former Willbros executive, renounced his citizenship and became a Nigerian citizen to avoid extradition and FCPA criminal charges.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Michael Volkov, The Volkov Law Group | Attorney Advertising

Written by:

Michael Volkov

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