Jury to Weigh Reach of U.S. Bribery Law -- Update

Date : 07/11/2019 @ 02h56
Source : Dow Jones News
Valeur : Alstom (ALO)
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Jury to Weigh Reach of U.S. Bribery Law -- Update

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By Dylan Tokar 

NEW HAVEN, Conn. -- A jury is expected to deliberate Thursday in a long-running case that is testing the reach of the U.S.'s foreign bribery law.

Closing arguments were delivered Wednesday in the trial of Lawrence Hoskins, a former Alstom SA senior vice president. The U.S. government's case against Mr. Hoskins hinges in part on whether he qualifies as an "agent" under the U.S. Foreign Corrupt Practices Act, which prohibits bribes to foreign government officials.

To make that determination, the jury will consider whether Mr. Hoskins, who was charged in 2013 with helping organize a scheme to bribe Indonesian officials for a $118 million power contract, had sufficient ties to a former Alstom subsidiary based in Windsor, Conn.

"The question of agency is absolutely critical to this case," Christopher Morvillo, a lawyer for Mr. Hoskins said Wednesday. Mr. Hoskins couldn't be found guilty of any FCPA-related charges unless jurors first concluded beyond a reasonable doubt that the former executive was an agent of the U.S. subsidiary, he said.

The statute, enacted in 1977, applies to companies listed on U.S. stock exchanges and private companies organized under U.S. laws, their shareholders, directors, employees and agents, as well as other individuals who violate the statute while in U.S. territory.

Prosecutors allege that Mr. Hoskins acted as an agent of Alstom Power Inc., the former Alstom subsidiary, which served as headquarters of Alstom's world-wide boiler business.

He did so by supporting API's bid to secure the Indonesia power contract -- known as the Tarahan Project -- including by helping to hire two consultants who paid bribes to a member of Indonesia's parliament and executives at the country's state-owned electricity company, they said.

"The defendant very clearly was working on behalf of API," one of the prosecutors, Daniel Kahn, said. "What you are concerned about are the services he was providing on the Tarahan Project."

Lawyers for Mr. Hoskins, a British national who worked in suburban Paris and didn't visit the U.S. during his three years at Alstom, have disputed the government's characterization of his relationship with the U.S. subsidiary.

API didn't have enough control over Mr. Hoskins's activities to meet the common legal definition of an agent, they have said.

"A supporter is not always a person who is under the control of the person being supported," Mr. Morvillo said Wednesday. "It only means that Mr. Hoskins's job was to provide assistance where he could. It does not create an agency relationship."

Mr. Morvillo also argued that the government had failed to prove that Mr. Hoskins, who didn't testify during the trial, had sufficient knowledge of the bribery scheme. Emails by Mr. Hoskins shown to jurors were consistent with an understanding that the consultants were being hired merely to provide local lobbying services, he said.

"In other words, you will find a man doing his job," Mr. Morvillo said.

The case is before the U.S. District Court for the District of Connecticut. Mr. Hoskins is also facing money-laundering and conspiracy charges.

The case against Mr. Hoskins already has yielded a ruling that placed more defined limits on who the government can charge with conspiring to violate the statute. The trial, which began Oct. 28, was delayed in part because of a lengthy appeal by the Justice Department of that ruling.

A U.S. government investigation of Alstom ended when the company resolved its own FCPA violations. Alstom sold its power business to General Electric Co. in 2015, after agreeing to pay $772 million to resolve the FCPA probe.

Write to Dylan Tokar at dylan.tokar@wsj.com

 

(END) Dow Jones Newswires

November 06, 2019 20:41 ET (01:41 GMT)

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