A federal judge Wednesday partially acquitted the former Alstom S.A. executive convicted by a federal jury in November of bribing officials in Indonesia, ruling that prosecutors had failed to prove he violated the Foreign Corrupt Practices Act by acting as an agent of Alstom’s Connecticut subsidiary.
Judge Janet Bond Arterton acquitted Lawrence Hoskins on the seven FCPA-related counts he faced. But she let stand the four money laundering counts.
Hoskins, 69, a UK citizen, had been convicted by the jury in Connecticut on one count of conspiracy to violate the Foreign Corrupt Practices Act and six counts of substantive FCPA violations. Judge Arterton said the jury’s guilty verdict on all those counts “was against the weight of the evidence adduced at trial.”
She granted Hoskins’ motion for a new trial on the seven FCPA-related counts on a “conditional” basis in case prosecutors appeal Wednesday’s ruling and her acquittal is “later vacated or reversed.”
But on one money laundering conspiracy count, and three substantive money laundering counts, Judge Arterton said in her 29-page decision that prosecutors produced sufficient evidence for the jury to convict Hoskins. She let his conviction on those counts stand.
At his trial in November, prosecutors convinced the jury that although Hoskins worked for Alstom’s parent company in France and never traveled to the United States, he violated the FCPA by acting as an agent for Alstom’s Connecticut subsidiary when he helped arrange bribes in Indonesia.
Prosecutors said Hoskins played a role in hiring two “consultants” who bribed Indonesian officials, including a member of parliament. Alstom’s Connecticut unit eventually won a $118 million contract from Indonesia’s state-owned electricity company.
But Judge Arterton said prosecutors hadn’t demonstrated that the Connecticut subsidiary exercised “control over Mr. Hoskins’s actions sufficient to demonstrate agency.” Without that control, she said, no agency between the Connecticut subsidiary and Hoskins existed as a matter of law.
Alstom S.A. pleaded guilty in December 2014 to violating the Foreign Corrupt Practices Act by bribing officials in Indonesia, Saudi Arabia, Egypt, and the Bahamas. The company paid $772 million in criminal penalties to settle the charges.
Three other Alstom executives pleaded guilty in the United States for the Indonesia bribes.
After the company’s FCPA resolution, General Electric bought Alstom’s power business in 2015.
Alstom’s consortium partner in Indonesia, Marubeni Corporation, pleaded guilty in 2014 to one count of conspiracy to violate the FCPA and seven substantive FCPA offenses. The Japan-based company paid a criminal penalty of $88 million to resolve the offenses.
Last week, the DOJ unsealed an indictment against three former Indonesia-based executives — two from Alstom and one from Marubeni — for their alleged roles in the Indonesia bribery. The three defendants were all charged with substantive violations of the Foreign Corrupt Practices Act, as well as FCPA conspiracy and money-laundering related counts.
Although the DOJ indicted Hoskins in 2013, his trial was delayed until last year while he challenged the reach of the FCPA, and during government appeals.
In earlier rulings, Judge Arterton had dismissed part of the indictment against Hoskins. She said a non-U.S. citizen, national, or resident couldn’t be held criminally liable for conspiring to violate or aiding and abetting a violation of the FCPA.
The Second Circuit mostly agreed, but said Hoskins could still be charged with FCPA offenses if the DOJ could show he had acted as an agent of a “domestic concern” (Alstom’s Connecticut subsidiary). On that basis the DOJ went ahead with his trial.
In Wednesday’s order, Judge Arterton didn’t set a date for sentencing Hoskins on his money laundering conviction.
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