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  • Guilty plea from former Venezuelan official in bribery scheme

    The DOJ announced on Thursday, April 19, that a former Venezuelan official had pleaded guilty to one count of conspiracy to commit money laundering. The charge arose from Cesar David Rincon Godoy’s role in a bribery scheme involving bribes paid by the owners of U.S. companies to Venezuelan government officials to secure energy contracts and payments on outstanding invoices. As the former general manager of the procurement subsidiary of the Venezuelan state-owned energy company, Petroleos de Venezuela S.A. (PDVSA), Rincon had solicited and accepted bribes. The judge entered a personal money judgment of $7,033,504.71. As a government official receiving the bribes, Rincon could not be charged himself with FCPA offenses (which are targeted at those paying the bribes). Related charges against four other individuals remain pending, including charges of conspiracy to violate the FCPA; 11 individuals have already pleaded guilty in the PDVSA cases.  

    For prior coverage of the PDVSA enforcement actions, please see here.

    DOJ Petroleos de Venezuela Venezuela Bribery FCPA Anti-Money Laundering

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  • Houston-based energy company sues former Venezuelan government officials for bribery related conduct related to Petroleos

    On February 16, 2018, Harvest Natural Resources and HNR Energia B.V (collectively, “Harvest”), a Houston-based energy corporation that formally dissolved in May 2017, filed suit in the Southern District of Texas against two former presidents of Venezuela’s national oil company Petroleos de Venezuela, S.A. (“PDVSA”), Rafael Dario Ramirez Carreno (“Ramirez”) and Eulogio Antonio Del Pino Diaz (“Del Pino), and others who allegedly worked for Ramirez and PDVSA. According to the complaint filed by Harvest, Venezuela’s Ministerio del Poder Popular de Petroleo y Mineria twice refused to allow Harvest to sell energy assets co-owned with PDVSA because Harvest refused to pay bribes requested by the defendants. According to Harvest, the denials forced the company to sell the same assets at a loss of $470 million. Harvest has sued the defendants alleging civil violations of the Racketeer Influenced and Corrupt Organizations Act (“RICO”), the Sherman Act, the Robinson-Patman Act, and the Texas Free Enterprise and Antitrust Act.

    This suit was filed days after the DOJ unsealed charges against five former Venezuelan government officials for their involvement in a money laundering scheme at PDVSA. Previous FCPA Scorecard coverage of the ongoing DOJ and ICE-HIS investigation into bribery at Petroleos can be found here.

    DOJ Harvest Natural Resources Petroleos de Venezuela Bribery

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  • DOJ unseals charges against former Venezuelan government officials for money laundering and FCPA violations in Petroleos scheme

    On February 12, the DOJ unsealed charges against five former Venezuelan government officials for their involvement in a money laundering scheme at Venezuela’s state-owned energy company Petroleos de Venezuela (Petroleos). The five defendants—Luis Carlos De Leon Perez (De Leon), Nervis Gerardo Villalobos Cardenas (Villalobos), Cesar David Rincon Godoy (Cesar Rincon), Alejandro Isturiz-Chiesa, and Rafael Ernesto Reiter Munozare (Reiter)—are each charged with conspiracy to commit money laundering. De Leon and Villalobos are also charged with conspiracy to violate the FCPA. 

    De Leon, Villalobos, Cesar Rincon, and Reiter were arrested in Spain in October 2017 on arrest warrants based on an indictment filed in the Southern District of Texas last August. Cesar Rincon has been extradited from Spain, while the others are pending extradition. 

    The indictment alleges that the five defendants possessed significant influence within Petroleos, which permitted them to solicit PDVSA vendors for “bribes and kickbacks in exchange for providing assistance to those vendors in connection with their PDVSA business.” The Petroleos vendors included residents of the U.S. and vendors who owned U.S.-based businesses. According to the indictment, two Petroleos vendors, Roberto Enrique Rincon Fernandez and Jose Shiera-Bastidas, transferred more than $27 million to accounts in Switzerland that were connected to De Leon and Villalobos. Rincon and Shiera previously pleaded guilty in the Southern District of Texas to FCPA charges related to the bribery of Petroleos officials. 

    The charges are part of an ongoing investigation by the DOJ and ICE-HSI into bribery at Petroleos, which has resulted in charges against fifteen individuals, ten of whom have pleaded guilty. Previous FCPA Scorecard coverage of the Petroleos investigation can be found here.

    Score Card Bribery FCPA Petroleos de Venezuela DOJ Anti-Money Laundering Financial Crimes

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  • Florida Energy Company Owner Pleads Guilty to Conspiracy to Violate the FCPA in Venezuelan Bribery Scheme

    On October 11, the DOJ announced that Fernando Ardila Rued – a co-owner of several Florida-based energy companies – pleaded guilty to FCPA charges that he conspired to bribe foreign officials in exchange for obtaining contracts from Venezuela’s state-owned energy company, Petroleos de Venezuela S.A. (PDVSA). In his plea, Ardila admitted to conspiring with two other individuals – Abraham Jose Shiera Bastidas and Roberto Enrique Rincon Fernandez – from 2008 through 2014 to bribe PDVSA purchasing analysts through cash payments and other entertainment in order to win contracts for Shiera and Rincon’s companies. Ardila is the tenth individual who has pleaded guilty in connection with the PDVSA scheme.    

    This investigation has been a collaboration between the DOJ, ICE-HSI, and IRS-Criminal Investigation Division. Previous FCPA Scorecard coverage of the PDVSA investigation can be found here.

    Score Card Bribery FCPA DOJ Petroleos de Venezuela Financial Crimes International

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  • Two Additional Businessmen Plead Guilty in Petroleos Scheme

    On January 10, it was announced that two additional defendants, Juan Jose Hernandez Comerma and Charles Quintard Beech III, owners of Florida and Texas-based energy companies, had pleaded guilty to foreign bribery charges related to a scheme to corruptly secure energy contracts from Venezuela’s state-owned oil company, Petroleos de Venezuela S.A.

    According to admissions by Hernandez and Beech, they conspired with other previously charged defendants from 2008 through 2012 to pay bribes and other things of value, including recreational travel, meals, and entertainment to Petroleos officials to obtain energy contracts or receive payment for previously awarded contracts. Some of the bribes were paid to a Petroleos official’s relative to conceal the nature, source, and ownership of the bribe.

    In total, eight individuals have now pleaded guilty in cases related to the government’s investigation into bribery at Petroleos. The government’s investigation is ongoing. Previous FCPA Scorecard coverage on the Petroleos investigations can be found here.

    Score Card Bribery FCPA Petroleos de Venezuela

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  • Businessman Pleads Guilty to Foreign Bribery in Petroleos Scheme

    On June 16, the DOJ announced that Roberto Enrique Rincon Fernandez, the owner of several U.S.-based energy companies, had pleaded guilty to bribery charges related to a scheme to corruptly secure energy contracts from Venezuela's state-owned oil company, Petroleos de Venezuela (Petroleos).  This stems from the previously reported December 2015 charges against Mr. Rincon and Jose Shiera-Bastidas, the owner of an oil-field supply company. According to admissions made by Rincon, he worked with Shiera to submit bids for equipment and services to Petroleos.  Beginning in 2009, Rincon and Shiera agreed to pay bribes to Petroleos purchasing analysts to ensure that their companies were placed on Petroleos bidding panels, which enabled the companies to secure lucrative energy contracts.  Rincon also admitted to making bribe payments to other Petroleos officials to ensure that his companies were placed on Petroleos-approved vendor lists and given payment priority over other vendors with outstanding invoices.  Previous FCPA Scorecard coverage on the Petroleos investigations can be found here.

    Venezuela Petroleos de Venezuela

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  • Contractor Pleads Guilty in Venezuela Oil Probe

    On March 23, 2016, the DOJ announced that Abraham Jose Shiera-Bastidas pleaded guilty in a federal court in Texas to violating the FCPA and committing wire fraud by paying bribes to ensure that two companies won contracts and received other preferential treatment from Venezuela’s state-owned oil company, Petroleos de Venezuela (Petroleos).  Mr. Shiera-Bastidas was the owner of an oil-field supply company that supplied goods and services to Petroleos de Venezuela.  Mr. Shiera-Bastidas was charged in December 2015 along with the owner of the other involved company, Mr. Roberto Enrique Rincon Fernandez. The charges against Mr. Rincon Fernandez are still pending and he has been detained pending his trial, which is scheduled for April. The judge also unsealed guilty pleas made by four other individuals in connection with the same probe into Petroleos.  One of these individuals was an employee of Mr. Shiera-Bastidas’ company, while the other three individuals were former officials of Petroleos.  Mr. Shiera-Bastidas is due to be sentenced in July and faces a maximum of five years in prison for each count. Previous FCPA Scorecard coverage on the Petroleos investigations can be found here.

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  • Two Contractors Arrested in Venezuela Oil Probe

    According to news reports, a DOJ spokesman has confirmed the December 20 arrest of two contractors in connection with an ongoing probe of Venezuela’s state-owned oil company, Petroleos de Venezuela.  One of the contractors, Roberto Rincon, is the owner of a Houston-based oil-field supply company.  The other, Abraham Jose Shiera-Bastidas, is a Venezuelan national living in Florida. The indictment, filed in a Texas federal court, alleges violations of the FCPA’s anti-bribery provisions as well as money laundering offenses, and seeks forfeiture of several Swiss bank accounts.  The indictment alleges that between 2009 and 2014, Rincon and Shiera-Bastidas conspired to bribe Venezuelan officials in exchange for rigging the bidding panels that award contracts from Petroleos de Venezuela.  The indictment identifies nine alleged bribes paid by Rincon and Shiera-Bastidas totaling $790,000.

    Venezuela Petroleos de Venezuela

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