Two former executives admit paying foreign bribes

Reuters News
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Posted: Apr 17, 2012 6:08 PM
Two former executives admit paying foreign bribes

By Aruna Viswanatha

WASHINGTON (Reuters) - Two former executives at a California valve company pleaded guilty to foreign bribery charges, the Justice Department said on Tuesday, handing the department a victory after a string of defeats.

Control Components Inc's former president, Stuart Carson, and his wife, Hong Carson, the company's former director of sales for China and Taiwan, pleaded guilty late Monday before a federal judge in Santa Ana, California, the DOJ said.

The company, which makes valves used at nuclear, oil and gas plants, pleaded guilty in July 2009 to violating the Foreign Corrupt Practices Act, which bars U.S. firms from paying bribes to officials of foreign governments.

The company, owned by IMI plc, paid an $18.2 million fine and admitted to paying bribes in more than 30 countries in exchange for business from which it reaped profits of around $46.5 million.

But many of the more than half-dozen company executives who were also charged for their alleged role in the scheme fought back. Two are scheduled to stand trial in June.

The guilty pleas come after several high-profile defeats for the Justice Department's foreign bribery team.

Earlier this year, for example, the department moved to dismiss a case involving almost two dozen defendants in the arms industry after prosecutors were unable to convince two juries that what the defendants did was illegal.

Another federal judge in California in December dismissed the conviction of power products firm Lindsey Manufacturing based on what he said was prosecutorial misconduct.

Stuart Carson, 73, faces up to 10 months in prison. Hong Carson, 48, faces three years of probation.

Lawyers for the Carsons did not immediately respond to requests for comment.

(Reporting By Aruna Viswanatha; Editing by Phil Berlowitz)