Designed for busy in-house counsel, compliance professionals, and anti-corruption lawyers, this newsletter summarizes some of the most important international anti-corruption law and enforcement developments from the past month, with links to primary resources. This month we ask: Which U.S. congressman was charged with accepting bribes from foreign companies? What advice does the Enforcement Director of the U.S. Securities and Exchange Commission (“SEC”) have for companies hoping to get cooperation credit? Which UK-based renewable energy company and its director were charged for bribing a Caribbean official? The answers to these questions and more are here in our May 2024 Top 10.
1. U.S. Congressman Indicted for Allegedly Accepting Bribes from Azerbaijani and Mexican Companies
On May 3, 2024, The U.S. Department of Justice ("DOJ”) announced the unsealing of an indictment in the Southern District of Texas charging U.S. Congressman Enrique Roberto “Henry” Cuellar and his wife with participating in two schemes involving bribery, unlawful foreign influence, and money laundering. Over a course of seven years, Congressman Cuellar and his wide allegedly accepted approximately $600,000 in bribes from two foreign entities, an oil and gas company owned and controlled by the government of Azerbaijan and a bank headquartered in Mexico City. In return for these bribes, Congressman Cuellar allegedly agreed to influence U.S. foreign policy to benefit Azerbaijan and to manipulate legislative activities to favor the Mexican bank. The indictment includes multiple charges against the Cuellars, including bribery, violations of the Foreign Agents Registration Act (“FARA”), and money laundering, with potential penalties of up to 20 years’ imprisonment for some counts. Congressman Cuellar’s trial is currently scheduled to begin in March 2025.
2. U.S. Senator’s Egypt- and Qatar-Related Bribery Trial Begins
On May 15, 2024, the corruption trial of U.S. Senator Robert Menendez began in the Southern District of New York. DOJ first announced the charges, which involved allegations that Menendez accepted bribes to further Egyptian interests in September 2023. In January 2024, a superseding indictment added allegations that Menendez accepted bribes from a New Jersey businessman in exchange for furthering the businessman’s interests in Qatar. One of Menendez’s co-defendants, Jose Uribe, who allegedly provided a luxury car to Menendez’s wife in exchange for the Senator’s assistance in trying to stop an investigation into one of Uribe’s associates, pleaded guilty in March 2024 and is expected to testify for the government during the trial.
3. Financial Asset Manager Pleads Guilty to Venezuela Money Laundering Scheme
On May 14, 2024, financial asset manager Luis Fernando Vuteff of Argentina pleaded guilty in the Southern District of Florida to conspiracy to commit money laundering. Vuteff admitted that, beginning around 2015, he and another asset manager, Ralph Steinman of Switzerland, were retained to launder the proceeds of an alleged foreign currency exchange scheme using loan contracts with Venezuela’s national oil company, Petróleos de Venezuela, S.A. (“PDVSA”), that exploited Venezuela’s fixed foreign currency exchange rate and that were obtained via bribes and kickbacks. Vuteff admitted that more than $9.5 million was transferred to bank accounts in the United States, including bank accounts located in Miami. Vuteff faces up to 10 years’ imprisonment and agreed to forfeit over $4 million in unlawfully obtained assets, including real estate in Miami, Paraguay, and Spain. DOJ first announced charges against Vuteff and Steinman in July 2022. DOJ has obtained money laundering charges against other financial professionals in connection with this alleged scheme (see, for example our October 2018 and April 2021 Top 10s), as well as several former Venezuelan officials (see, for example, our May 2021 and June 2022 Top 10s).
4. Financial Asset Manager and Former PDVSA Official Sentenced in Procurement-Related Bribery Case
At two back-to-back hearings in the Southern District of Texas on May 21, 2024, Swiss-Portuguese banker Paulo Casquiero Murta[1] and former PDVSA official César David Rincón Godoy[2] were sentenced to time served following their guilty pleas related to alleged schemes involving payments by U.S.-based companies to Venezuelan government officials to improperly obtain energy contracts and priority payment for outstanding invoices. Murta was charged in September 2019 for allegedly helping launder the proceeds of these schemes. The charges against Murta were dismissed by the district court on jurisdictional grounds in July 2022 and reinstated by the United States Court of Appeals for the Fifth Circuit in February 2023, only to be dismissed again by the district court, this time on Speedy Trial Act grounds, in May 2023 (followed by an explanatory opinion in June 2023). In November 2023, the Fifth Circuit affirmed the Speedy Trial Act dismissal but remanded to a different district court judge to determine whether the dismissal should have been with or without prejudice. In Murta’s sentencing memo,[3] his counsel stated that he “decided not to fight any longer.” In April 2018, DOJ announced that Rincón had pleaded guilty to money laundering, admitting that he accepted bribes from business owners in Florida and Texas in exchange for assisting those businesses in receiving payment priority and additional PDVSA contracts and then laundered the proceeds through a series of financial transactions, including wire transfers to accounts in the United States and Switzerland.
5. Agent for Florida-based Asphalt Company Sentenced in Brazilian Bribery Case
On May 23, 2024, Luiz Eduardo Andrade was sentenced in the Eastern District of New York to one year of probation and ordered to forfeit $140,000 following his 2017 guilty plea to one count of conspiring to violate the Foreign Corrupt Practices Act (FCPA).[4] DOJ announced Andrade’s guilty plea in September 2020, at the same time that it announced that Sargeant Marine had pleaded guilty to conspiring to violate the FCPA in connection with millions of dollars in bribes allegedly paid to officials in Brazil, Ecuador, and Venezuela in order to secure approximately $38 million in contracts from those countries’ national oil companies. Andrade, acting as Sargeant Marine’s agent, allegedly agreed with a consultant in Brazil to bribe Brazilian politicians and officials of Brazil’s national oil company, Petróleo Brasileiro S.A. (“Petrobras”), to help obtain contracts with Petrobras.
6. Court Denies Motion to Dismiss Fraud Charges Against Mozambique’s Former Minister of Finance
On May 31, 2024, Judge Nicholas Garaufis of the Eastern District of New York denied[5] a motion to dismiss wire fraud and securities fraud charges against Manuel Chang, the former finance minister of Mozambique. DOJ announced the charges against Chang in March 2019, alleging that he and two other Mozambique officials coordinated with three former London-based investment bankers and two executives at a shipbuilding company to steal approximately $200 million from a total of $2 billion in loans issued to state-controlled companies between 2012 and 2016 for three maritime projects, including one related to tuna fishing. For his role in the scheme, Chang allegedly received at least $5 million in bribes and kickbacks that were not disclosed to investors. South Africa extradited Chang to the United States to stand trial on the charges in July 2023. Chang moved to dismiss the indictment based on a number of grounds, including that the wire fraud and securities fraud counts should be dismissed following the Supreme Court’s decision in Ciminelli v. United States, 598 U.S. 306 (2023), which invalidated the right‑to‑control theory of wire fraud. That theory had allowed for a conviction when the “defendant’s scheme denies the victim the right to control its assets by depriving it of information necessary to make discretionary economic decisions.” Judge Garaufis held that Ciminelli did not warrant dismissal because Chang’s indictment did not rely on the right-to-control theory and instead made allegations that Chang “sought to deprive investors and potential investors of money, a ‘traditional property interest.’” (For an example of a successful Ciminelli argument in an international bribery case, see our September 2023 Top 10 describing the vacating of honest services fraud convictions of two defendants prosecuted as part of the global bribery scandal involving the Fédération Internationale de Football Association (“FIFA”) and affiliated continental and regional soccer confederations.)
7. SEC Enforcement Director Provides Guidance on Self-Reporting, Cooperation, and Remediation
At the annual West Coast Securities Enforcement Forum on May 23, 2024, SEC Enforcement Director Gurbir S. Grewal remarked on the “Five Principles of Effective Cooperation in SEC Investigations.” First, organizations should start with self-policing to detect potential securities law violations early. Second, organizations should self-report any potential violations without delay, even before knowing all the facts. Third, organizations should remediate the potential violation. Fourth, organizations should cooperate with the SEC by going above and beyond what is legally required, especially because organizations often have the best access to and understanding of relevant evidence. Finally, organizations should collaborate with the SEC early, often, and substantively. By helping simplify the issues and improve the efficiency of an investigation, organizations can establish their credibility with the SEC. Grewal concluded, “In the end, a cooperative and collaborative approach, guided by the principles I’ve outlined today, can help put [attorneys and their] clients in the best position to get cooperation credit.” Of course, the decision to self‑report potential misconduct to a government agency involves a complicated weighing of numerous factors, but publicly traded companies that discover potential FCPA violations should incorporate Grewal’s remarks into their calculus.
8. Director of UK-based Renewable Energy Company Charged with Bribing Antigua and Barbuda Official
On May 23, 2024, the UK National Crime Agency (“NCA”) announced that Peter Virdee, also known as Hardip Singh and as Batman, had been charged with bribery of a foreign public official, contrary to Section 6 of the UK Bribery Act 2010 (“UKBA”), in relation to an alleged multi-million-pound bribery scheme. Virdee, a wealthy real-estate mogul, serves as a director for PV Energy Ltd, a UK-based renewable energy company. Between January 2015 and July 2017, Virdee allegedly bribed Asot Michael, Antigua, and Barbuda’s then-Minister of Tourism, Economic Development Investment and Energy, for the benefit of PV Energy Ltd. As a result of Virdee’s actions, the energy company has also been charged with failing to prevent bribery, contrary to Sections 7 and 11(3) of the UKBA.
9. Former Aide to Madagascar President and Her Associate Sentenced in Bribery Case
On May 10, 2024, the NCA announced that Romy Andrianarisoa, the former Chief of Staff to the President of Madagascar, was sentenced three-and-a-half years’ imprisonment following her February 2024 trial conviction on bribery charges. On the same day, Philippe Tabuteau, Adrianarisoa’s associate, was sentenced two years and three months’ imprisonment following his September 2023 guilty plea to related charges. According to the NCA, Andrianarisoa and Tabuteau attempted to solicit bribes from Gemfields, a UK ruby and emerald mining company, in exchange for their help securing an exclusive mining joint venture with the Government of Madagascar. The company reported the suspected bribe demands to the NCA, which commenced an investigation that made use of surveillance and other covert tactics and led to the pair’s arrest in August 2023.
10. African Tax Corruption Trial Begins in France
On May 13, 2024, trial began for eight former executives of Bourbon, a French oil and gas company. The executives and the company are being prosecuted for allegedly bribing tax officials in Nigeria, Cameroon, and Equatorial Guinea to reduce Bourbon’s tax assessment from $227 million to $4.1 million. The alleged scheme was discovered in 2012 when law enforcement caught Bourbon’s then-tax director Marc Cherqui smuggling $250,000 cash in his suitcase at the Marseille-Provence Airport. Law enforcement later learned Cherqui was returning from Nigeria and that the cash allegedly constituted Cherqui’s reward for successfully paying $2.7 million in bribes to government officials.
[1] Minute Entry for Sentencing, United States v. Paulo Jorge da Costa Casquiero Murta, Case No. 4:17-cr-00514-8 (S.D. Tex. May 21, 2024).
[2] Minute Entry for Sentencing, United States v. Cesar David Rincon-Godoy, Case No. 4:17-cr-00514-3 (S.D. Tex. May 21, 2024).
[3] Sentencing Memorandum, United States v. Paulo Jorge da Costa Casquiero Murta, Case No. 4:17-cr-00514-8, ECF No. 631 (S.D. Tex. May 19, 2024).
[4] Judgment, United States v. Luiz Eduardo Andrade, Case No. 1:17-cr-00497-ENV, ECF No. 43 (E.D.N.Y May 23, 2024).
[5] Memorandum & Order, United States v. Manuel Chang, Case No. 1:180-cr-00681-NGG, ECF No. 573 (E.D.N.Y. May 31, 2024).
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