A Los Angeles grand jury yesterday indicted a Mexican husband and wife for their alleged roles in bribery and money laundering involving Mexican government officials at the state-owned electric utilitiy, Comisión Federal de Electridad, or CFE.
Enrique Faustino Aguilar Noriega, 56, of Cuernavaca, Mexico, was charged in a seven-count indictment with conspiracy to violate the Foreign Corrupt Practices Act, four substantive FCPA violations, money laundering conspiracy, and money laundering. Angela Maria Gomez Aguilar, 55, also of Cuernavaca, was charged with money laundering conspiracy and money laundering.
Angela Gomez Aguilar was arrested last month in Houston. She was moved to the Central District of California, where she’s in custody.
According to the indictment, their company, Grupo Internacional de Asesores S.A. (Grupo), acted as a sales agent for an Azusa, Calif.,-based company. From 2002 until 2009, the indictment alleges, Enrique Aguilar was paid a 30 percent commission for sales to CFE. The indictment alleges that all or part of the commission was intended to be used to bribe Mexican officials in exchange for contracts with CFE. The final price of goods and services sold to CFE was increased by 30 percent to cover the cost of the alleged bribery.
The couple allegedly laundered the money in the Grupo brokerage account. The indictment alleges they bought a yacht for $1.8 million and a Ferrari for $297,500 for a CFE official. They’re also charged with paying more than $170,000 worth of American Express bills and sending about $600,000 to relatives of a CFE official.
In November 2009, the general manager of a Sugar Land, Texas-based ABB subsidiary was arrested for his alleged role in a conspiracy to bribe Mexican government officials to win work from CFE.
John Joseph O’Shea, 57, of Pleasanton, California, was charged with one count of conspiracy to violate the Foreign Corrupt Practices Act (18 U.S.C. § 371), 12 counts of violating the FCPA (15 U.S.C. § 78dd-2 et seq), four counts of international money laundering (18 U.S.C. § 1956), and one count of falsifying records in a federal investigation (18 U.S.C. § 1519).
O’Shea allegedly hired Fernando Maya Basurto, 47, of Mexico City, to act as the ABB Texas unit’s sales agent in Mexico. In December 1997, the CFE awarded a contract that generated more than $44 million dollars in revenue for ABB’s Texas unit. In October 2003, CFE also awarded it a multi-year contract for maintenance and upgrades that generated more than $37 million in revenue.
ABB discovered the alleged bribery and fraud during an internal investigation. It self-disclosed the payments and related activities to the Justice Department and the Securities and Exchange Commission and helped with their investigations. In late 2008, the Swiss-based engineering company said it reserved about $850 million for possible resolution of U.S. and European corruption charges.
Basurto was first arrested in Dallas in April 2009 on a criminal complaint charging him with conspiracy to structure transactions and structuring transactions to evade currency reporting requirements. As part of his plea deal, the DOJ filed a superseding criminal information charging him with one count of conspiracy to violate the FCPA, to launder money, and to falsify records. The information said jurisdiction over Basurto was based on his being “an agent of a domestic concern, as that term is defined in the FCPA, 15 U.S.C. § 78dd-2(h)(1).”
He pleaded guilty in November 2009 in Houston and has been cooperating in the investigation. He faces up to five years in prison. The Justice Department hasn’t announced his sentencing date.
Enrique Aguilar faces a up to five years in prison for the FCPA conspiracy count and each of the four substantive FCPA counts. The conspiracy and substantive money laundering counts each carry a maximum penalty of 20 years in prison. The government is also seeking criminal forfeiture.
As the DOJ says, an indictment is merely an accusation, and defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
View the DOJ’s September 15, 2010 release here.
Download the indictment in U.S. v. John Joseph O’Shea here.
Download Fernando Maya Basurto’s plea agreement with the Justice Department here.