[chottala.com] Sufficient evidence to trigger FBI corruption probe: US lawyer

Sufficient evidence to trigger FBI corruption probe: US lawyer

David Bergman

The FBI should consider conducting an investigation into whether a US
company, which won a contract to assist the Bangladesh government in
launching the country's first space satellite named Bangubandhu 1, had
committed offences under the Foreign Corrupt Practices Act, a senior
US corruption lawyer told New Age.
Dan Pickard, a partner in the Washington-based law firm, Wiley Rein
LLP, and a specialist in US business corruption offences, said that
the evidence about the $10 million deal, disclosed by New Age in a
series of articles published in May, was sufficient to 'trigger' a US
police investigation even though there was no evidence of corrupt
payments.

'In my view the circumstances that appear to exist in relation to this
tender concerning the Bangladesh space satellite, where a US company
has won a contract even though it reportedly did not meet the minimum
tender requirements, itself should be enough to trigger an FCPA
investigation,' he said. 'It is certainly reasonable to expect them to
conduct an investigation.'

New age's articles published in May showed that Space Partnership
International not only failed to meet the minimum tender requirements
but won the contract despite receiving a significantly lower score in
the technical evaluation compared with another US company, Globecomm
Systems Inc, which was then improperly disqualified.

The articles also revealed a network of family and business
connections in which the vice-president of the winning company was
related to Farid Khan, who is both the brother of minister Faruk Khan
and also the director of Summit Communications which was a junior
partner in the deal.

Both Space Partnership International and Farid Khan deny any
wrongdoing. The company has stated that the selection process was
'conducted properly' and 'we were selected because we were the most
qualified.'

Earlier, in response to a written parliamentary question about the
tender, the posts and telecommunications minister, Rajiuddin Ahmed
Raju, also denied that there was any 'corruption and irregularities'
in the selection of the consultant. He pointed to a review panel of
the Central Procurement Technical Unit which had concluded, after
receiving a complaint from one of the losing consultants, that 'the
tender process was completed in an appropriate manner.'

The Foreign Corrupt Practices Act, which became law in 1988, makes it
an offence for any US citizen or company to give bribes or offer any
inducement to a government official of another country in order to
obtain or retain business.
The US embassy, whose ambassador was present at the signing of the
agreement between the government and Space Satellite International,
has refused to comment on whether it has referred the case for
investigation. 'We do not comment on possible ongoing cases and
matters of investigation,' Kelly McCarthy, the embassy's Press and
Information Officer, told New Age.

'The US embassy takes seriously any allegations regarding violations
of US law, including the Foreign Corrupt Practices Act,' she added.
'We evaluate these allegations on a case-by-case basis to determine
whether the evidence presented justifies a referral for further
investigation.'

The Department of Justice also declined to comment.
Pickard, a corruption law expert who has written a manual about the
legislation concerned, said that an FCPA investigation could be
started even though there was 'no smoking gun of evidence of a corrupt
payment or an offer to pay.'
'I wouldn't be surprised if they investigate a case like this,
particularly considering that Bangladesh is a country which has a high
corruption rating by such organisations as Transparency
International,' he said.

However, another lawyer was more cautious. 'What sometimes happens in
these situations is that contracting rules are violated simply to
award the contract to a friend or relative, but there are no "under
the table" payments involved, and hence no FCPA implications,' said
Scott Thomas, the head of the political law practice at Dickstein
Shapiro.

'So, while I think there certainly are bases for investigation here —
violation of contracting rules, conflict of interest rules, and
providing false information rules — I'm not seeing a basis for an FCPA
investigation yet,' he told New Age.
The call for an FCPA investigation is likely to increase as New Age
can reveal that in signing the contract with Space Partnership
International, the Bangladesh government appears to have paid over $3
million more than the bid made by Globecomm, the company which was
improperly disqualified after receiving the highest technical score

A Globecomm official told New Age that its bid was about $6.5 million
compared with Space Partnership International's offer of around $10
million.The claim could not be independently confirmed as its bid was
not opened by the Bangladesh Telecommunication Regulatory Commission.

The claim, however, does correspond to the signed statement made by
Globecomm to a procurement review panel that looked into the deal.
This stated that 'the company understands that the financial offer of
SPI, USA is much greater than [Globecomm] has quoted in its financial
offer.'The company official also told New Age, '$10 million is a large
amount of money for the actual amount of work that needs to be carried
out.'

The Department of Justice has made enforcement of the FCPA one of its
priorities.
In November 2011, assistant attorney general Lanny A Breuer told a
conference, 'The Justice Department has been vigorously enforcing the
Foreign Corrupt Practices Act and achieving strong results. … [J]ust
two weeks ago, we secured the longest prison sentence — 15 years —
ever imposed in an FCPA case.'
Iftekharuzzamn, the executive director of Transparency International,
told New Age that he supported a 'credible investigation by the
relevant US authorities, such as the FBI, to establish whether [Space
Partnership International] was involved in any irregularities like
influence peddling and conflict of interest with or without
kickbacks.'

Two former officials of the large Canadian engineering company
SNC-Lavalin, seeking a consultancy contract supervising the
construction of the Padma bridge, have recently been charged in Canada
for corruption offences similar to those contained in the FCPA. The
officials are accused of trying to bribe Bangladesh government
officials.The World Bank formally cancelled its financial support for
the project recently alleging 'a high-level corruption conspiracy
among Bangladeshi government officials'.

http://www.newagebd.com/detail.php?date=2012-07-10&nid=16574


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