Smartmatic, a voting machine company with its headquarters in London, is under investigation by American authorities for what is alleged to be corruption in its business dealings in the Philippines.
While the allegations being probed by the FBI aren't related to the 2020 election here in the United States, Smartmatic is under increasing scrutiny for its potential violations of the federal law, as a new report in Semafor explains based on conversations with a Smartmatic lawyer and two other people familiar with the DOJ's investigation.
?????? NEWS: Voting machine company Smartmatic is under investigation by DOJ for allegedly engaging in corrupt business practices in the Philippines, @semaforben & @ShelbyTalcott report.
— Semafor (@semafor) September 26, 2022
Investigators are focused on how the company won a 2016 contract. https://t.co/vnEwgr9deo
"Federal investigators are conducting an intensifying inquiry, which began in 2019 under President Trump, into whether Smartmatic violated the Foreign Corrupt Practices Act, according to the two sources and a document connected to the case," Semafor reports. "That law bars U.S. citizens and companies from paying bribes to foreign officials."
And while two presidential administrations in Washington have pursued the case, Smartmatic's alleged troubles began some 8,000+ miles away from the FBI's headquarters:
The current investigation centers on allegations that emerged after the 2016 election in the Philippines, in which Ferdinand “Bongbong” Marcos Jr. — who is now the country’s president — claimed he had been robbed of the vice presidency. He blamed both Smartmatic and the country’s Commission on Elections (known as Comelec) for the outcome. Last year, the country’s Supreme Court unanimously dismissed the claims of a stolen election.
But the allegations of financial malfeasance proved more damaging. In 2017, the estranged wife of the chairman of the country’s election commission claimed that the chairman, Andrew Bautista, had received a “commission” from a law firm that also served as Smartmatic’s legal counsel, CNN Philippines reported.
In a telephone interview, Bautista told Semafor that he did receive a “referral fee” from the law firm representing Smartmatic, but that it was before he joined government and had “nothing to do with Smartmatic.”
Bautista noted that Smartmatic had also been awarded a contract for the 2010 and 2013 elections. “Any implication that I was ‘bribed’ to secure the contract is untrue because a) Smartmatic had been working with Comelec years before I was appointed; b) Smartmatic was already the chosen provider for the 2016 elections when I joined and c) Smartmatic continued to be Comelec’s technology partner for the 2019 and 2022 elections,” Bautista wrote. He resigned in October 2017, and reportedly relocated to the United States amid an investigation of his finances.
Bautista, who said he had left the Philippines but declined to give his location, citing safety concerns, declined to say whether he’d been contacted by U.S. investigators.
“If they did, that would be a confidential proceeding that I would not be able to disclose to you,” he said.
It’s unclear how closely, if at all, the specific public allegations regarding Bautista are connected to the current U.S. investigation of Smartmatic.
For its part, Smartmatic's lawyer told Semafor that "companies working in the election industry always face scrutiny and inquiries" and added that the company "has cooperated with the authorities since learning about this inquiry and will continue to do so."
The lawyer emphasized that the current probe "has nothing to do with election security and integrity" and said the company has "been informed that it is on business in Asia almost a decade ago by one of our subsidiaries there."
If the name Smartmatic sounds familiar, it's likely due to the company's $2.7 billion defamation lawsuit against Fox News over claims about the voting company's role in the outcome of the 2020 presidential election — along with a smattering of similar lawsuits against allies of former President Donald Trump.
However, as Semafor's report notes, the U.S. probe of alleged wrongdoing "could take pressure off Fox, as defamation lawsuits typically focus on reputational damages, and charges under the Foreign Corrupt Practices Act could also do deep damage to Smartmatic’s reputation."
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