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Indian origin man held by FBI in kickbacks sting

January 20, 2010 15:42 IST

An Indian-origin British national is among 22 executives of military and law enforcement suppliers arrested by the Federal Burea of Investigation on charges of attempting to bribe the Defence Minister of an African country in what is being described as the largest ever corruption expose of its kind in the US.

43-year-old Pankesh Patel, managing director of a UK firm that acts as a sales agent for companies in law enforcement and military products industries, and two more Britons --David Painter (56) and Lee Wares (43)-- were among 22 people arrested, the US Department of Justice said. Wares is the chairman and director of a British company that markets armoured vehicles.

Of the 22 executives, 21 were arrested from Las Vegas on Monday. The 22nd person was arrested in Miami. None of the people arrested are from Las Vegas, but all were in town for the 2010 Shooting, Hunting and Outdoor Trade Show, which began at Sands Expo and Convention Centre on Tuesday, Fox News said. The indictments unsealed before a US court on Tuesday allege that these arrested individuals engaged in a scheme to pay bribes to the defence minister of an African country. The name of the country has not been revealed. The scheme was part of the undercover operation, with no actual involvement from any minister. The defendants allegedly agreed to pay 20 per cent "commission" to a sales agent who they believed represented the defence minister of an African state in order to win a portion of a US $ 15 million deal to outfit the country's presidential guard. In reality, the "sales agent" was an undercover FBI agent. 


defendants were told that half of that 'commission' would be paid directly to the Minister of Defence. The defendants allegedly agreed to create two price quotations in connection with the deals, with one quote representing the true cost of the goods and the second quote representing the true cost, plus the 20 per cent 'commission'."The defendants also allegedly agreed to engage in a small 'test' deal to show the Minister of Defence that he would personally receive the 10 per cent bribe," the Justice Department said in a statement.
The unsealed 16 indictments represent the largest single investigation and prosecution against individuals in the history of Department of Justice's enforcement of the Foreign Corrupt Practices Act (FCPA), a law that prohibits US persons and companies, and foreign persons and firms acting in the United States, from bribing foreign government officials for the purpose of obtaining or retaining business. The maximum prison sentence for the conspiracy count and for each FCPA count is five years. The maximum sentence for the money laundering conspiracy charge is 20 years in prison.
"This ongoing investigation is the first large-scale use of undercover law enforcement techniques to uncover FCPA violations and the largest action ever undertaken by the Justice Department against individuals for FCPA violations," Assistant Attorney General Lanny A Breuer said. "The fight to erase foreign bribery from the corporate playbook will not be won overnight, but these actions are a turning point. From now on, would-be FCPA violators should stop and ponder whether the person they are trying to bribe might really be a federal agent," Breuer said.

Lalit K Jha in Washington
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