From Swoop to Woops?...when federal agents "swooped in" on SHOT Show two years ago and arrested 21 industry folks on charges they'd conspired to bribe a supposed African defense minister by padding bids for military equipment, the administration said it was a masterful sting operation carried out under the United States Foreign Corrupt Practices Act (FCPA). Under FCPA, it is illegal to bribe foreign officials.
The supposed African defense minister was, in fact, a federal agent and the whole deal was a sting. Stung in the operation were well-known industry figures, including a Vice President of Smith & Wesson, a former U.S. Secret Service Agent, and others. They were charged with a litany of offenses including violating the FCPA, conspiracy to violate anti-bribery laws, and conspiracy to commit money laundering.
Two years later, the Justice Department's cases have, well, fallen apart, primarily because justice department prosecutors were repeatedly unable to prove to juries that what the defendants had done was illegal. Now, citing two hung juries, rulings during the cases as to what constituted "evidence" and the "substantial governmental resources, as well as judicial, defense, and jury resources" needed to continue the case, the head of the Justice Department's Criminal Division Lanny Breuer has decided to drop the case.
Now the question is: what about the defendants? Three were acquitted, three others pleaded guilty at earlier stages of the case, and the remaining sixteen were awaiting trial or re-trial. There's no word on whether the convictions will be voided, but the nineteen other defendants appear to be free from further actions.
There's a larger wrinkle in this story: the "setbacks" of the Justice Department in this case may, in fact, lead to more defendants accused under the FCPA to fight their cases in court rather than seek settlements. If you'd like to read more about the case, it's USA vs. Goncalves et al, No. 09-cr-335, in the United States District Court for the District of Columbia.
As always, we'll keep you posted.
