Avon Embroiled in Bribery Probe

by Leslie Wayne / Published March 23, 2012 in The Big Sweep | Leave a comment

Avon ladies selling products at a sale in New York in 2009. / REUTERS

In an amended lawsuit, shareholders of Avon Products allege that a top Avon executive was about to provide government regulators with information about foreign bribery — until the company bought his silence.

The shareholders charge that Fabian LaPresa, who had drafted an internal audit showing that Avon executives had bribed Chinese officials, received extra benefits when he left the company in 2006. Those benefits, the shareholders say, came after LaPresa told his supervisor that he would disclose the contents of the audit unless he received the extra benefits. LaPresa was about to be booted from the company for expense account violations, and was seeking to extract a larger severance benefit.

The lawsuit, according to Reuters, was filed by two German investment funds, LBBW Asset Management Investmentgesellschaft mbH and SGSS Deutschland Kapitalanlagegesellschaft mbH, on behalf of other Avon shareholders. LaPresa managed to negotiate one year of salary and health benefits rather than a few months of support.

In 2008, Avon, the cosmetics giant, announced it had opened an internal inquiry into whether it had violated the U.S. anti-bribery laws in China. Two years earlier, in what was seen as a major coup, Avon received the first-ever license by a western company to sell its products door-to-door.

Sweep to Suit alleges Avon paid to keep official quiet in bribery probe

Former Irish Prime Minister Bertie Ahern. / REUTERS

Former Irish Prime Minister Bertie Ahern was once known as a party-hardy premier who could seemingly do no wrong.

Now, in a long-awaited verdict, three judges have found that Ahern received at least $276,000 in secret payments and then repeatedly lied about this under oath. Still, Ahern seems to have escaped any serious consequences for his alleged actions. The judges cleared Ahern of corruption charges, citing a lack of evidence that Ahern gave favors in exchange for the money.

Ahern left office in 2008, after 11 years in power, just as evidence being collected by a tribunal looking into his finances began to leak out. Reuters reports that Ahern’s downfall tracks that of the nation. Ahern was widely praised for a banking bubble that brought new wealth to the nation, and then blamed when the bubble burst, shaking the Irish economy and angering voters.

The judge’s report said that corruption was “endemic and systemic” at every level of government in Ireland in the late 1990s.

One point that aided Ahern was the absence of credible anti-bribery laws in Ireland until 1996, making tax evasion the only easily proven offense. Some of the charges against Ahern dated back to 1994.

Sweep to Former Irish PM Ahern’s explanation of benefits untrue — inquiry 

The press has an important role in rooting out corruption. People are innocent until proven guilty. And the government should respond to reports of corruption by the media.

Those are the words of . . . Russian President Dimitry Medvedev. In a speech, he said that it is the duty of the press to monitor the work of all leaders and civil servants to expose corruption. ”All of us – from the president to the village chieftain — must react to publications in the media,” said Medvedev, according to a report in the Russian press agency RT.

Given that Russia has long ranked as one of the most corrupt countries, it will be interesting to see how much resonance his words will actually have.

Sweep to Media has key role in war against corruption-Medvedev

Pennsylvania Speaker of the House: Guilty as Charged of Corruption

by Aaron Kessler / Published March 21, 2012 in The Big Sweep | Leave a comment

Pennsylvania Attorney General Tom Corbett upon state Speaker of the House John Perzel's arrest in 2009.

Former Pennsylvania House Speaker John Perzel is headed for the big house after being sentenced on corruption charges.

As the Pittsburgh Post-Gazette reports, the judge sentenced the former Republican leader to “between 30 months and five years in prison and ordered him to pay $1 million in restitution for masterminding a $10 million scheme to use public resources to aid in GOP political campaigns.”

Prosecutors say Perzel and nearly a dozen other House Republican lawmakers used tax dollars “to purchase sophisticated computer databases designed to target voters,” according to the Post-Gazette.

Perzel will begin serving his sentence on April 11. He is one of a host of former lawmakers being prosecuted as part of the scheme.

Sweep to Former speaker of the Pa. House sentenced in corruption case

Most politicians busted for bribery just a week before an election might face a tough time at the polls. Apparently, not in Chicago.

As the Chicago Sun-Times reports, Illinois State Rep. Derrick Smith “scored a big win Tuesday against his Republican-turned-Democratic challenger in a quirky primary contest a week after his arrest on a federal bribery charge.”

Smith is charged with allegedly accepting a $7,000 bribe to “write a recommendation letter for a daycare center he thought was seeking a state grant.” He garnered more than 75 percent of the vote Tuesday.

Smith’s challenger, Tom Swiss, told the Sun-Times he felt the arrest may actually have helped raise Smith’s name recognition with Chicago voters and thus contributed to his win. Go figure.

Sweep to One week after bribery charge, State Rep. Derrick Smith wins big

Nigeria, frequently ranked among the most corrupt countries in the world, has signed a new accord with the European Union to pump $46 million into a sweeping anti-corruption effort.

The agreement was signed late Monday by Nigeria’s national planning minister and the head of the EU’s delegation to Nigeria, the AFP reports.

“The overall objective of these three projects is to promote good governance and contribute to Nigeria’s efforts in enhancing transparency, accountability and combating corruption,” the EU said in a statement.

The projects, to be implemented by the UN Office on Drug and Crime, will include not just the anti-corruption programs but also additional funding for related projects to tackle drug-related issues.

Sweep to EU, Nigeria sign accord on corruption

No State Gets an A on Corruption Report Card

by Diana Jean Schemo / Published March 20, 2012 in The Big Sweep | Leave a comment

Daniel Van Pelt, a New Jersey assemblyman, shields his face as he leaves a Newark, N.J., courthouse in July. He was among 40 people arrested in a corruption probe. / REUTERS

To the complete shock of lawmakers in that state, New Jersey led the nation in a 50-state survey of ethics and corruption released today.

The national report card, a joint project of the Center for Public Integrity, Global Integrity and Public Radio International, ranked states on some 330 indicators of corruption in 14 categories, including ethics enforcement, access to information, campaign finance laws and legislative and executive accountability. (Full disclosure: 100R contributed a report on New York.)

It is the most comprehensive study available of corruption at the state level, and comes as newspapers have drastically reduced the share of reporters assigned to state houses, compromising their watchdog function.

Overall, no state drew bragging rights. New Jersey, at the top, received a grade of B+, largely because a spate of scandals involving elected officials prompted tougher laws and stepped up enforcement. Five states drew grades of B, while eight flunked outright.

Sweep to Fifty states and no winners

A subsidiary of Lufthansa, BizJet, has agreed to pay $11.8 million to settle accusations that it bribed officials in Mexico and Panama to obtain aircraft maintenance contracts.

The accusations by the U.S. Justice Department, brought under the Foreign Corrupt Practices Act, involve payments to Mexico’s federal Preventive Police, its Presidential Air Transport Service and the state governments of Sonora and Sinaloa, as well as the Panamanian Civil Air Authority.

Under the deal, U.S. authorities agreed to defer prosecution for three years, during which time BizJet has pledged to cooperate with an ongoing federal investigation.

Sweep to BizJet settles bribery case for $11.8 million

Corruption investigators in Great Britain has ordered the arrest of a former prime minister of the islands of Turks and Caicos.

Authorities on the islands in the West Indies have been seeking the former premier, Michael Misick, for several months in connection with allegations of corruption and money laundering during his time in office.

The islands are overseas territories of Great Britain, which imposed direct rule on them in 2009 over charges of government corruption.

Sweep to UK seeks arrest of former Turks and Caicos premier

Going Down, Limelight in Tow

by Leslie Wayne / Published March 16, 2012 in The Big Sweep | Leave a comment

Former Governor of Illinois Rod Blagojevich outside his Chicago home one day before reporting to federal prison. / REUTERS

While some may slink off to prison in the dead of night, that’s not the way that former Illinois Governor Rod Blagojevich decided to go.  In the sharp glare of the spotlight that Blagojevich so loved, he headed off to a Colorado prison from his Chicago home after hugging well-wishers and reading off a list of his accomplishments.

In doing so, Blagojevich follows in the tradition of Illinois politicians.  He is the fourth Illinois governor in recent memory to head off to prison. He will begin serving a 14-year sentence on corruption charges at the Federal Correctional Institution, outside Denver.

Blagojevich was convicted of profiting from his office, in part by seeking to trade or sell the U.S. Senate seat formerly held by President Barack Obama. After leaving office in 2009, Blagojevich had a fleeting, and failed, career on reality television.

Never one to avoid the spotlight – to the contrary – Blagojevich expressed optimism as he teared up during his lengthy farewell.  The 55-year-old Blagojevich will be 67 when he becomes eligible to leave prison.  At home, he leaves his wife and two children, the youngest of which is eight years old.

Sweep to Cameras in tow, Blagojevich surrenders to prison

In this case, it may have been the government who was more corrupt than the man on trial.

U.S. Republican Sen. Ted Stevens of Alaska sits in a van outside the U.S. Federal Courthouse in Washington in 2008. /REUTERS

A 525-page report laid out, in blistering detail, prosecutorial misconduct in the botched 2008 corruption case against the former Alaska Ted Stevens, who died in a 2010 plane crash. The report shows how prosecutors failed to live up to their obligation to turn over material to Stevens’ lawyers that could have cleared his name.

Following his conviction, a federal judge threw out the case. But this came after Stevens, a long-time member of the Senate, has lost his 2008 re-election bid.  He had been charged with lying on his Senate financial disclosure statement over gifts and services to renovate his Alaska home.

The report was ordered by Federal Judge Emmet G. Sullivan, who had overseen the case. U.S. Attorney General Eric Holder had asked that he set aside the conviction on learning that evidence had been withheld by the prosecutors.

The Justice Department is concluding its own investigation, which will recommend disciplinary action against some of the prosecutors involved.

Sweep to Evidence concealed in Stevens corruption case

And now some good news on the corruption front.

The Ethisphere Institute, a think tank that promotes good business practices, has just released its sixth annual selection of the World’s Most Ethical Companies.  A total of 145 made the list representing three dozen industries, with 43 of the winners located outside of the U.S.

According to the Institute’s press release, some familiar corporate names made the cut, among them Cisco, Ford and Timberland.  Others were not exactly household names: Ethical Fruit Company of the U.K.  and Tokio Marine Holding of Japan.

To make the list, companies had to exceed legal minimums for ethical complaints, promote ideas that benefited the public good and prod their competitors to do the same.

A total of 23 companies have made the list all six years. Among them are:  Aflac, American Express, Fluor, General Electric, Milliken & Company, Patagonia and Starbucks, among others.

A tip of the hat to all the winners.

Sweep to Ethisphere recognizes exceptional ethical leadership

Leaked Emails Show Syrian First Couple Ignoring Bloodshed in Country

by Diana Jean Schemo / Published March 14, 2012 in The Big Sweep | Leave a comment

Syrian President Bashar al-Assad and his wife Asma, after voting on a referendum for a new constitution last month. / REUTERS

A cache of some 3,000 emails said to be from Syrian President Bashar al-Assad and his wife, obtained by The Guardian, show Syria’s first couple as largely disregarding the bloodshed raging in their home country.

The emails, many of which coincide with the Syrian military’s crackdown on pro-democracy protestors, show Asma al-Assad, who signed her emails “aaa,” as enjoying Internet shopping sprees. She ordered jewelry from a small Paris atelier, an expensive vase from Harrod’s and mused over bling-studded shoes from a special private line of Christian Louboutin.

Bashar al-Assad comes across as self-pitying and insulated from the bloodshed he was unleashing on his country, and relying closely on Iran. In one email to his wife, Assad sends a YouTube link and lyrics to a country western song by Blake Shelton, which laments, “The person that I’ve been lately/ain’t who I wanna be.”

Increasingly, seems he’s not the man Syrians want him to be, either.

Sweep to Exclusive: secret Assad emails lift lid on  life of leader’s inner circle

Another pain in the neck for Gloria Arroyo. / REUTERS

The former first couple of the Philippines, Gloria and Mike Arroyo, faced an order of arrest by the nation’s anti-corruption court Tuesday. They are charged with graft in connection with a $330 million contract to build a National Broadband Network in the Philippines.

The contract with China’s ZTE Corp. to build a high-speed communications system linking government offices at the national and local levels originally came in at $130 million. But it swelled by $200 million—allegedly the result of top government officials demanding payoffs.

In 2008, Gloria Arroyo, then president, canceled the contract in the face of a Senate inquiry that proved kickbacks to government officials had inflated the price.

Gloria Arroyo, who is frequently seen in a neck brace these days, had asked to be allowed to apply for bail from the Veterans Memorial Medical Center, where she is being held before trial on electoral fraud charges. Her husband posted bail Tuesday and was released ahead of trial. The couple denies any wrongdoing, and have said they are the victims of a political vendetta by the current president, Benigno Aquino III.

Sweep to Arroyo couple, 2 others ordered arrested over NBN deal

Burma’s government is pledging a new-found openness to democracy, but hasn’t quite gotten the hang of free speech.

Its Ministry of Mining has vowed to sue a Rangoon-based journal, The Voice Weekly, for reporting on allegations of corruption within the ministry. In a statement, the ministry denied the accusations, and said the report “tarnishes the dignity of the ministry and [that it] is not ethical for the media to write like this.”

The allegations were contained in a government audit taken up by the lower house of Burma’s parliament. The audit said the at the mining ministry had sold 50 percent of a copper mining project to one company for $100 million, but that another company had actually made the payment.

It also alleged corruption in five other government ministries, none of which plans to sue.

Sweep to Burmese ministry vows to sue over graft allegations

As the director of international relations for Haiti’s minister for telecommunications, Jean Rene Duperval officially earned $25,000 a year. But that money was chump change in comparison to the bribes his office allowed Duperval to collect.

This week, a Miami jury convicted Duperval of pocketing some $500,000 in bribes from two Miami companies with contracts to provide long-distance service to Haiti. With the money, Duperval paid for his home in Miramar, and made deposits to his children’s prepaid college tuition plans.

The bribes, paid by executives at Terra Telecommunicaitons and Cinergy Telecommunications, won the companies better terms for their long-distance rates.

Duperval, who was convicted on 21 counts related to money laundering, faces up to 20 years in prison.

Sweep to Miami jury convicts former Haiti official on bribery charges

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