United States: Department of Justice
Terra Telecommunications Corp. (Miami-based telecommunications company)("Terra")
Joel Esquenazi (President of Terra)
Carlos Rodriguez (former Executive Vice President of Terra)
Antonio Perez (former Controller at Terra)
Juan Diaz (President of J.D. Locator Services, a Miami-based shell intermediary for three private telecommunications companies)
Jean Fourcand (President and Director of Miami-based Fourcand Enterprises Inc.)
Marguerite Grandison (former President of Telecom Consulting Services Corp., an intermediary for a Miami-based telecommunications company, and sister of Jean Rene Duperval)
Robert Antoine (former Director of International Relations at Haiti’s state-owned Telecommunications D’Haiti)
Jean Rene Duperval (former Director of International Relations for Telecommunications at Haiti’s state-owned Telecommunications D’Haiti)
Patrick Joseph (former General Director for Telecommunications at Haiti’s state-owned Telecommunications D’Haiti)
Venel Joseph (Patrick Joseph's father, governor of the Bank of Haiti, appointed by Jean-Bertrand Aristide, named in the indictment as Official A)
Cinergy Telecommunications Inc. (Miami-based telecommunications company) ("Cinergy")
Uniplex Telecommunications Inc. (Miami-based telecommunications company related to Cinergy) ("Uniplex")
Washington Vasconez Cruz (President of Cinergy and Uniplex)
Amadeus Richers (former Director of Cinergy and Uniplex)
Cecilia Zurita (former vice president of Cinergy Telecommunications Inc.)
Digitek (suspected to be Company A named in indictment, owned by former president Jean-Bertrand Aristide's brother-in-law, Lesly Lavelanet)
Jean-Bertrand Aristide (former president of Haiti, suspected of being Official B named in indictment)
DESCRIPTION OF BUSINESS
Miami, Florida, United States
NATIONALITY OF FOREIGN OFFICIALS
SUMMARY OF ALLEGATIONS
In Spring 2009, the DOJ charged Juan Diaz, President of J.D. Locator Services, a Miami-based shell intermediary for three private telecommunications companies and Antonio Perez, former Controller at Terra Telecommunications Corp., a Miami-based telecommunications company, with conspiracy to violate the FCPA and money laundering laws in connection with over $1 million in improper payments made to former Haitian government officials. [While court documents do not specifically identify Terra as one of the companies at issue, the company's identity was reported in the press.]
Diaz was charged with conspiring to make corrupt payments to Haitian officials for the purpose of securing business advantages from Haiti's state-owned telecommunications company, Telecommunications D'Haiti ("Haiti Teleco"), on behalf of three different Miami-based telecommunications companies, including Terra. He paid, and concealed payments of, over $1,028,851 to Haitian officials in his capacity as an intermediary for the three companies. Diaz earned $73,824 in commissions for laundering the bribes.
Perez was charged with conspiring to make corrupt payments to officials of Haiti Teleco on behalf of Terra. He was Controller at the company from March 1998 through January 2002 and assisted the company in making improper payments to former Haitian officials, which totaled approximately $674,193 through the course of the conspiracy, which spanned from 1998 to 2005. Perez assisted in paying $36,375 worth of side payments from November 2001 through January 2002 and helped conceal the payments through Diaz's shell company and by recording them as consulting services.
According to court documents, Terra and two other Miami-based telecommunications companies executed a series of contracts with Haiti Teleco so that the company's customers could place telephone calls to Haiti. Diaz and Perez conspired with the companies to make side payments to the Director of International Relations and the Director General at Haiti Teleco at the time. The side payments were made through a shell company owned by Diaz. In exchange for the improper payments, the former Haitian officials provided the Miami-based telecommunications companies with a variety of business advantages, including preferential connection rates and various credits towards sums owed, such as reductions in the number of minutes for which payments were due.
In an indictment unsealed on December 7, 2009, five additional individuals were charged for their alleged roles in the foreign bribery, wire fraud and money laundering scheme, under which, between November 2001 and March 2005, Terra allegedly paid more than $800,000 to shell companies to be used for bribes to foreign officials of Haiti Teleco.
Joel Esquenazi, President of Terra, and Carlos Rodriguez, former Executive Vice President at Terra, were indicted for conspiracy to violate the FCPA, conspiracy to commit wire fraud, substantive violations of the FCPA, conspiracy to commit money laundering and substantive counts of money laundering. Robert Antoine and Jean Rene Duperval, two former Directors of International Relations at Haiti Teleco were charged with conspiracy to commit money laundering and conspiracy and substantive counts of money laundering, respectively. Marguerite Grandison, President of Telecom Consulting Services Corp., an intermediary for a Miami-based telecommunications company (and Duperval's sister) was charged with conspiracy to violate the FCPA and commit wire fraud, substantive violations of the FCPA, conspiracy to commit money laundering and substantive counts of money laundering.
On February 1, 2010, a criminal information was filed against Jean Fourcand, President and Director of Miami-based Fourcand Enterprises Inc., alleging that, between November 2001 and August 2002, Fourcand received funds originating from U.S. telecommunications companies for the benefit of Haiti Teleco official Robert Antoine. Various U.S. telecommunications companies sent money to Diaz, who then dispersed the funds by issuing J.D. Locator checks made payable to Fourcand Enterprises. In one instance, Fourcand received a $18,500 check on February 20, 2002, drawn on J.D. Locator Service’s bank account, which Fourcand deposited into a Fourcand Enterprises account. The check contained a false invoice number to make the payment appear to be for legitimate services. Fourcand then used the funds to facilitate a real estate transaction for the benefit of Robert Antoine.
On July 13, 2011, a superseding indictment was filed in connection with the Haiti Teleco-related foreign bribery, wire fraud and money laundering scheme. Cinergy Telecommunications Inc., a privately-held Florida telecommunications company, was charged with one count of conspiracy to violate the FCPA and to commit wire fraud, six counts of FCPA violations, one count of conspiracy to commit money laundering and 19 counts of money laundering. Washington Vasconez Cruz, the President of Cinergy and another Florida telecommunications company, Uniplex Telecommunications Inc., was charged with one count of conspiracy to violate the FCPA and to commit wire fraud, six counts of FCPA violations, one count of conspiracy to commit money laundering and 19 counts of money laundering. Amadeus Richers, the then-director of Cinergy and Uniplex, was charged with one count of conspiracy to violate the FCPA and to commit wire fraud, six counts of FCPA violations, one count of conspiracy to commit money laundering and 19 counts of money laundering. Patrick Joseph, a former General Director for Telecommunications at Haiti Teleco, was charged with one count of conspiracy to commit money laundering. Jean Rene Duperval and Marguerite Grandison, who were previously charged in the initial December 2009 indictment, were each charged with two counts of conspiracy to commit money laundering and 19 counts of money laundering.
The DOJ described the alleged misconduct at issue in the superseding indictment as follows in its July 13, 2011 press release:
"According to the superseding indictment, the defendants allegedly participated in a scheme to commit foreign bribery and money laundering from December 2001 through January 2006. The indictment alleges that during this time period Cinergy and its related company, Uniplex Telecommunications Inc., allegedly paid more than $1.4 million to shell companies to be used for bribes to foreign officials of the Republic of Haiti’s state-owned national telecommunications company, Telecommunications D’Haiti (Haiti Teleco).
According to court documents, Cinergy and Uniplex executed a series of contracts with Haiti Teleco that allowed the companies’ customers to place telephone calls to Haiti. The bribe payments allegedly were authorized by Washington Vasconez Cruz, the telecommunications companies’ president, and Amadeus Richers, the companies’ director, and were allegedly paid to Haitian government officials at Haiti Teleco, including Patrick Joseph and Jean Rene Duperval. According to the superseding indictment, the purpose of these bribes was to obtain various business advantages from the Haitian officials for Cinergy and Uniplex, including preferred telecommunications rates and credits toward sums owed. To conceal the bribe payments, the defendants allegedly used various shell companies to receive and forward the payments, including J.D. Locator Services, Fourcand Enterprises and Telecom Consulting Services."
Esquenazi and Rodriguez were charged in the initial December 2009 indictment and are unaffected by the July 2011 superseding indictment.
A second superseding indictment was filed on 20 January 2012, against Cecilia Zurita, who had served as vice president of Cinergy and is married to Vasconez Cruz. Zurita is accused of writing checks to shell companies in order for the funds to be used to bribe Haitian officials. The indictment alleges that over $2.9 million is subject to forfeiture.
Media reports dated 4 March 2012 allege that Company A as named in the indictment is Digitek, a suspected front owned by Lesly Lavelanet, the brother-in-law of former president Jean-Bertrand Aristide. Official B as named in the indictment is said to be Aristide himself, while Venel Joseph (Patrick Joseph's father), who was governor of the Bank of Haiti and appointed by Jean-Bertrand Aristide, is presumed to be named in the indictment as Official A.
RATIO OF IMPROPER PAYMENTS TO BUSINESS ADVANTAGE
Approximate Payments to Officials at Haiti’s State-Owned Telecommunications Company
Business Advantage Obtained
USD 2.3 million are alleged to have been paid by Cinergy and Uniplex to shell companies for kickbacks to officials
Preferential connection rates and reduced connection fees; discounted rates on long distance calls.
HOW CONDUCT WAS DISCOVERED
On April 27, 2009, Perez pleaded guilty to conspiring to commit FCPA violations and money laundering for his role in the payment of bribes to former officials of Haiti Teleco. On January 21, 2011 Perez was sentenced to 24 months in prison, followed by two years of supervised release, and to forfeit $36,375. He had faced a maximum of five years in prison and a fine of the greater of $250,000 or twice the gross gain.
On May 15, 2009, Diaz pleaded guilty to one count of conspiracy to violate the FCPA and money laundering. He admitted to receiving more than $1 million in bribe money from the telecommunication companies and then laundering the money for a former Haitian official. On July 30, 2010, Diaz was sentenced to 57 months in prison, to be followed by three years of supervised release. He was also ordered to pay $73,824 in restitution and to forfeit $1,028,851.
Antoine was extradited from Haiti to the U.S. on December 12, 2009 and held in Miami on $1 million bail. On March 12, 2010, Antoine pleaded guilty to a money laundering conspiracy count. He agreed to a forfeiture order of $1,580,771. On June 2, 2010, Antoine was sentenced to 48 months in prison, to be followed by three years of supervised release. In addition to the agreed forfeiture amount, he was also ordered to pay $1,852,209 in restitution. After cooperating with the government and testifying as a witness in two of the Haiti Teleco cases, Antoine's four year sentence was reduced to 18 months, on 29 May 2012, when he had already served 16 months of the original sentence.
On February 19, 2010, Fourcand pleaded guilty to laundering money used to bribe former Haiti Teleco officials. On May 5, 2010, he was sentenced to six months in prison. As part of his guilty plea, he also agreed to forfeit $18,500. An order was entered on 3 May 2012 granting Fourcand's motion for a reduction in sentence, requiring Fourcand to serve 2 months in prison, followed by a period of supervised release. A fine of $100 was levied.
On July 20, 2011, Duperval, Grandison and Joseph entered pleas of not guilty in response to the July 13 superseding indictment.
On August 4, 2011, a federal jury convicted Joel Esquenazi and Carlos Rodriguez, former executives of Terra Telecommunications Corp., on all counts for their roles in a scheme to bribe Haiti Teleco officials. They were each convicted of one count of conspiracy to violate the FCPA and commit wire fraud, seven counts of FCPA violations, one count of money laundering conspiracy, and 12 counts of money laundering. The verdict was reached after five hours of jury deliberations, following a two-and-a-half-week trial. On October 25, 2011, Esquenazi was sentenced to 15 years in prison and Rodriguez was sentenced to 84 months in prison.
On 9 May 2012, both Esquenazi and Rodriguez appealed their guilty verdicts to the 11th Circuit Court of Appeals, challenging "whether the District Court erred as a matter of law in its jury instruction regarding what constitutes an “instrumentality” of a foreign government for purposes of construing the counts, including the money laundering counts, that were dependent upon the Foreign Corrupt Practices Act (“FCPA”)" (Rodriguez), and "Whether the appellant] is entitled to an acquittal because employees of Haiti Teleco were not 'foreign officials' within the meaning of [the] FCPA simply because the National Bank of Haiti owned shares of Haiti Teleco and the Haitian government appoint board members and directors." (Esquenazi).
On 8 February 2012, Patrick Joseph, former director general of Haiti Teleco, changed his initial not- guilty plea to guilty, entering an agreement with the Department of Justice in the hopes of a reduced sentence in exchange for cooperation with the government. Joseph was sentenced on 6 July 2012 to one year and one day imprisonment to begin on 6 August 2012, plus a fine of USD 100, and one year of supervised release following release from prison, based on one count of conspiracy to commit money laundering.
On 24 February 2012, U.S. District Court Judge Jose Martinez granted the DOJ's motion to dismiss the case as against Cinergy, on the grounds that the government had determined the company to be "a non-operational entity that exists only on paper for the benefit of two fugitive defendants, Washington Vasconez Cruz and Cecilia Zurita."
Jean Rene Duperval, former head of international relations at Haiti Teleco, was convicted on 12 March 2012 on all counts of conspiracy and money laundering for which he was tried. This included two counts of conspiracy to commit money laundering, and 19 counts of money laundering. The DOJ statement announcing the conviction noted, “To conceal the payment and receipt of bribes, Duperval participated in a money laundering scheme to funnel about half a million dollars to two shell companies under his control...This verdict confirms that American taxpayers will not tolerate bribery, either at home or abroad, to obtain unfair business advantages.” Duperval testified in his own defense at trial, claiming that the payments were "tokens of appreciation," not bribes. Judge Martinez found Duperval guilty of perjury on the witness stand, and sentenced him 9 years in prison on 21 May 2012. Duperval was also required to forfeit USD 497,331.
On 16 May 2014, the 11th Circuit affirmed the DOJ's expansive view of a "foreign official" under the FCPA, upholding Joel Esquenazi and Carlos Rodriguez's convictions, and keeping intact the longest prison sentence ever imposed in an FCPA case. A unanimous three-judge panel defined "instrumentality" as "an entity controlled by the government of a foreign country that performs a function the controlling government treats as its own."
On 14 August 2014, Mr. Esquenazi and Mr. Rodriguez petitioned the U.S. Supreme Court to review their convictions on FCPA-related charges and to determine whether "an entity controlled by the government of a foreign country that performs a function the controlling government treats as its own” (1) fails to satisfy the constitutional requirement of adequate notice of what specific conduct violates the FCPA, and (2) is erroneously derived from commentary to an unrelated treaty [the OECD anti-bribery convention] that postdates the FCPA’s enactment."
The DOJ's investigation and proceedings against other companies and individuals involved in the scheme is ongoing.
- The DOJ will utilize prosecutions of corporate entities to assist in establishing cases against individual wrongdoers, as well as prosecutions of individuals to assist in establishing cases against corporate entities.
- Where feasible, the DOJ will solicit the assistance of its prosecutorial and investigative counterparts overseas, including those in the countries where the recipients of the bribes resided.
- In appropriate circumstances, DOJ may bring related charges - such as money laundering charges - against the foreign official recipients in a bribe-tainted transaction, such as where the officials reside in a U.S. state and committed part of the alleged offense while in the U.S.
DOJ Press Release: May 15, 2009 (Two Florida Businessmen Plead Guilty to Participating in a Conspiracy to Bribe Foreign Government Officials and Money Laundering)
Criminal Information: U.S. v. Juan Diaz (April 22, 2009)
Plea Agreement: U.S. v. Juan Diaz (April 21, 2009)
Factual Agreement: Juan Diaz (May 15, 2009)
Criminal Information: U.S. v. Antonio Perez (April 22, 2009)
Plea Agreement: U.S. v. Antonio Perez (April 22, 2009)
Factual Agreement: Antonio Perez (April 27, 2009)
DOJ Press Release: December 7, 2009 (Two Florida Executives, One Florida Intermediary and Two Former Haitian Government Officials Indicted for Their Alleged Participation in Foreign Bribery Scheme)
Indictment: U.S. v. Esquenazi et al (December 4, 2009)
DOJ Press Release: February 19, 2010 (Florida Businessman Pleads Guilty to Money Laundering in Foreign Bribery Scheme)
Criminal Information: U.S. v. Jean Fourcand (February 1, 2010)
Plea Agreement: U.S. v. Jean Fourcand (February 1, 2010)
Factual Agreement: U.S. v. Jean Fourcand (February 19, 2010)
DOJ Press Release: March 12, 2010 (Former Haitian Government Official Pleads Guilty to Conspiracy to Commit Money Laundering in Foreign Bribery Scheme)
Change of Plea: U.S. v. Robert Antoine (March 12, 2010)
DOJ Press Release: June 2, 2010 (Former Haitian Government Official Sentenced to Prison for His Role in Money Laundering Conspiracy Related to Foreign Bribery Scheme)
DOJ Press Release: July 30, 2010 (Florida Businessman Sentenced to 57 Months in Prison for Role in Foreign Bribery Scheme)
Plea Agreement: U.S. v. Robert Antoine (March 12, 2010)
Factual Agreement: U.S. v. Robert Antoine (March 12, 2010)
DOJ Press Release: July 13, 2011 (Florida Telecommunications Company, Two Executives, an Intermediary and Two Former Haitian Government Officials Indicted for Their Alleged Participation in Foreign Bribery Scheme)
DOJ Press Release: August 5, 2011 (Two Telecommunications Executives Convicted by Miami Jury on All Counts for Their Involvement in Scheme to Bribe Officials at State-Owned Telecommunications Company in Haiti)
DOJ Press Release: October 25, 2011 (Executive Sentenced to 15 Years in Prison for Scheme to Bribe Officials at State-Owned Telecommunications Company in Haiti)
Haiti Teleco - Patrick Joseph plea agreement (8 Feb. 2012)
Haiti Teleco - DOJ-Motion-to-Dismiss-Cinergy-Telecommunications
Haiti Teleco (Duperval) - DOJ Press Release (13 March 2012), Former Haitian Government Official Convicted in Miami for Role in Scheme to Launder Bribes Paid by Telecommunications Companies
Haiti Teleco - Duperval Forfeiture Motion (18 May 2012)
Haiti Teleco - Duperval Forfeiture Order (21 May 2012)
Haiti Teleco - Duperval sentencing minutes (21 May 2012)
Haiti Teleco - DOJ Press Release (21 May 2012), Duperval - Former Haitian Government Official Sentenced to Nine Years
Haiti Teleco - Appellate brief (Esquinazi) (9 May 2012)
Haiti Teleco - Appellate brief (Rodriguez) (9 May 2012)
Haiti Teleco - Alert (29 May 2012), Antoine receives reduction in sentence
Haiti Teleco - Amended Judgment (Fourcant) (3 May 2012, filed 17 April 2012)
Haiti Teleco - Amended Judgment (Fourcant) (3 May 2012, filed 17 April 2012
Hati Teleco - Judgment (10 July 2012), Patrick Joseph
IntermediariesProsecution of IndividualsTransportation/Communications