The Wall Street Journal Interviews Manatt Partner on Investor’s Bribery Conviction
“’See No Evil’ No Defense in Bribery Case”The Wall Street Journal – Private Equity Beat Blog
December 14, 2011 – The Wall Street Journal’s Private Equity Beat Blog looked to Manatt’s Jacqueline C. Wolff, co-chair of the firm’s Corporate Investigations & White-Collar Defense Practice Group, for insight into the implications of a Foreign Corrupt Practices Act case ruling.
As reported by The Wall Street Journal, a federal appeals court recently upheld the conviction of Frederic Bourke Jr. in a case that found him guilty of conspiracy to violate the Foreign Corrupt Practices Act (FCPA). Bourke is to serve one year and one day in prison after being convicted in 2009 for knowing about a bribery scheme between his business partner and the government of Azerbaijan.
Bourke’s conviction demonstrates that anti-bribery enforcement could also apply to private equity investors who have not directly paid bribes, but who retain information or knowledge of bribery schemes ensuing.
Wolff told The Wall Street Journal that in addition to pointing to the need for due diligence, the case shows that “if you think you can rely on what other PE firms are doing in not conducting due diligence, that may be a bad call.”
She pointed out that the court backed the trial judge in allowing the government “to present evidence of another potential investor conducting due diligence and determining that the FCPA risk was too high to invest while not allowing the defense to call another investor whose general due diligence practices were not as robust.”
Read the article here.
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