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violations,”®° three former Haitian officials involved in the
same scheme were convicted of money laundering,”
Mail and Wire Fraud
The mail and wire fraud statutes may also apply. In 2006, for example, a wholly owned foreign subsidiary of a US. issuer pleaded guilty to both FCPA and wire fraud counts where the scheme included overbilling the sub- sidiary’s customers—both government and private—and using part of the overcharged money to pay kickbacks to the customers’ employees. The wire fraud charges alleged that the subsidiary had funds wired from its parent’s Oregon bank account to off-the-books bank accounts in South Korea that were controlled by the subsidiary. The funds, amounting to almost $2 million, were then paid to manag- ers of state-owned and private steel production companies in China and South Korea as illegal commission payments and kickbacks that were disguised as refunds, commissions,
and other seemingly legitimate expenses.”
Certification and Reporting Violations
Certain other licensing, certification, and reporting requirements imposed by the U.S. government can also be implicated in the foreign bribery context. For example, as a condition of its facilitation of direct loans and loan guar- antees to a foreign purchaser of US. goods and services, the Export-Import Bank of the United States requires the US. supplier to make certifications concerning commis- sions, fees, or other payments paid in connection with the financial assistance and that it has not and will not violate the FCPA. A false certification may give rise to criminal liability for false statements."
Similarly, manufacturers, exporters, and brokers of certain defense articles and services are subject to regis- tration, licensing, and reporting requirements under the Arms Export Control Act (AECA), 22 U.S.C. § 2751, et seq., and its implementing regulations, the International Traffic in Arms Regulations (ITAR), 22 C.ER. § 120, e¢ seq. For example, under AECA and ITAR, all manufactur- ers and exporters of defense articles and services must reg-
ister with the Directorate of Defense Trade Controls. The
sale of defense articles and services valued at $500,000 or more triggers disclosure requirements concerning fees and commissions, including bribes, in an aggregate amount of $100,000 or more.” Violations of AECA and ITAR can
result in civil and criminal penalties.”*
Tax Violations
Individuals and companies who violate the FCPA may also violate U.S. tax law, which explicitly prohibits tax deduc- tions for bribes, such as false sales “commissions” deductions intended to conceal corrupt payments.”*’ Internal Revenue Service-Criminal Investigation has been involved in a num- ber of FCPA investigations involving tax violations, as well as
other financial crimes like money laundering.
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