FBI beefs up resources against foreign corruption

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Posted: Jan 14, 2015 9:56 PM
FBI beefs up resources against foreign corruption

WASHINGTON (AP) — The FBI is stepping up efforts against international corruption, creating new squads to search for cases of bribery that are rooted overseas but reach to the United States, law enforcement officials said.

The three squads, based in the FBI's largest field offices, will concentrate on a crime that the Justice Department has identified as a key priority in the last decade.

Officials say the need for additional resources is evident in an expanding global economy in which the impact of corruption can easily have ripple effects in the U.S. and contribute to a foreign government's destabilization. The work complements the Justice Department's ongoing efforts against kleptocracy, the enrichment of foreign rulers at the expense of their citizens, officials said.

"Corruption leads to lack of confidence in government. Lack of confidence in government leads to failed states. Failed states lead to terror and national security issues," said Jeffrey Sallet, chief of the FBI's public corruption and civil rights section, in an interview.

The initiative's goals are to identify additional violations of the Foreign Corrupt Practices Act, a statute that makes it illegal to bribe foreign government officials, that can be prosecuted in U.S. courts and to strengthen the FBI's expertise in the area.

More than 50 people have been convicted of violations of that law and related crimes since 2009, and some 50 corporations have paid more than $3 billion in penalties and forfeitures during that same time period, according to Justice Department data.

Last month, the department announced what it said was the largest penalty under the act — a $772 million fine and guilty plea from Alstom SA, a French power and transportation company with a U.S. subsidiary, to resolve criminal allegations that executives had bribed officials in foreign countries for business.

Common bribery schemes involve efforts by corporate officials to curry favor with foreign government leaders for help with business. For example, a Chinese subsidiary of Avon Products Inc., a U.S. cosmetics company, pleaded guilty last month to charges that executives and employees tried to conceal gifts, cash and other favors given to Chinese officials to obtain business benefits.

Under the new initiative, roughly 30 agents will be assigned to squads based in New York, Washington and Los Angeles, where a supervisor will manage investigators drawn from multiple cities, Sallet said.

The Washington field office has had a dedicated foreign corruption squad for several years, though it also worked on other corporate fraud, said Jennifer Leonard, who supervises the office's public corruption and white-collar crime efforts. Now that squad, along with the other two, will participate in the headquarters initiative and have more resources.

"We'll just be falling within an enhanced program," Leonard said.

As the government in recent years has ramped up its focus on overseas corruption, defense lawyers and business groups have criticized the approach as overly aggressive and inconsistent. Prosecutors have scored successes, though the track record isn't perfect. In Washington, for instance, the Justice Department endured a high-profile stumble in 2012 with the collapse of a case arising from a sting operation and a purported plot to bribe undercover FBI agents for business in the African nation of Gabon.

"I think all of us collectively would like a greater degree of clarity on the statute, and I think we would love a greater degree of clarity from the agencies as to what their view is on some of these matters," said William Steinman, a Washington lawyer who advises companies on how to comply with FCPA regulations.

FBI officials hope the new structure yields additional expertise for investigations that can be challenging and labor intensive, often requiring investigators to follow an overseas paper trail and identify international witnesses. They also hope to construct additional criminal cases against individuals, beyond large penalties levied against corporations.

"We really believe this is a global responsibility of the U.S. government," Sallet said.

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