Friday, October 7, 2005

FCPA Indictment for Bribery of Azerbaijan Officials

The U.S. Attorney's Office for the Southern District of New York announced the indictment of three men for allegedly paying millions of dollars in bribes to officials in Azerbaijan to gain control of that country's oil company, which was in the process of being privatized. One of the defendants, David Pinkerton, works for American International Group Inc. in its private equity group and was responsible for overseeing AIG's investments in Azerbaijan.  According to the government's press release (here), Pinkerton and two other defendants, Viktor Kozeny and Frederic Bourke, paid over $11 million in 1998 to gain control of the State Oil Company of the Azerbaijan Republic ("SOCAR"):

The Indictment charges that KOZENY, acting on his own behalf and as an agent of BOURKE, PINKERTON, and other members of the investment consortium, made a series of corrupt payments and promises to pay to a senior official of the Government of Azerbaijan (the "Senior Azeri Official"); a senior official of SOCAR (the "SOCAR Official"); and two senior officials of the State Property Committee or "SPC" (the "SPC Officials"), the agency that was responsible for administering the privatization program.

(ph)

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