The Grease That Got School Buses Rolling in Samoa

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Bribery at the schoolhouse door. / REUTERS

A high-ranking education official in American Samoa was convicted Thursday of obstructing justice and witness tampering related to a bribery scheme involving, of all things, school buses.

Paul Solofa, director of the school lunch program for the government of American Samoa – a U.S. territory in the southern Pacific – faces up to 30 years in prison and $500,000 in fines, the U.S. Department of Justice said Thursday.

Justice officials say Solofa was caught after an investigation into “cash bribes and kickbacks paid by vendors … in connection with the government’s purchase of school bus parts and services.”

Evidence presented at Solofa’s trial included taped conversations of him shaking down vendors providing the bus parts – insisting they wouldn’t get caught if they kept the bribes in cash.

“They cannot do anything with cash. Nothing,” Solofa said during one taped conversation, according to a DOJ release. “They cannot track down you on cash.”

Guess we know how that plan turned out.

Sweep to American Samoa Department of Education Official Convicted

David Einhorn / REUTERS

British financial regulators, fresh from fining prominent hedge fund manager David Einhorn $11 million this week for insider trading, have also set their sights on a former Bank of America/Merrill Lynch broker.

The broker, Andrew Osborne, will have to pay $550,000 in fines for his role in Einhorn’s illegal trading, the Financial Times reports. The problematic trades by Greenlight Capital, Einhorn’s firm, centered on the stock offering of a UK company called Punch Taverns.

The British government says that Osborne “took part in a phone call with the hedge fund manager and Punch management shortly before the equity fundraising,” the FT reports, and during that call provided details that “added up to inside information about the coming transaction.”

Osborne disputes that account and is expected to appeal the fine.

Sweep to Ex-BofA broker faces fine after Einhorn action

The infamous former chairman of HealthSouth, Richard Scrushy, will be released from prison as soon as a month from now – more than a year ahead of schedule – after a federal judge agreed to reduce his sentence.

Scrushy was convicted of numerous bribery and corruption charges in 2006 related to his dealings with former Alabama Gov. Don Siegelman. Last year the 11th Circuit tossed out the specific charges for what’s known as “honest services fraud” after Scrushy appealed.

As the Montgomery Advertiser reports, the prosecution of Scrushy centered on $500,000 in “donations Scrushy made to Siegelman’s 1999 campaign for a state lottery,” after which he was appointed to the state board that oversees hospital improvements.

Scrushy may be just as well-known for his bribery conviction as he is for beating the wrap on an earlier fraud case involving HealthSouth itself. Scrushy was the first CEO to be tried under the Sarbanes-Oxley Act, which aims to hold executives more accountable for crimes committed by their companies. But an Alabama jury acquitted him on all counts in 2005.

Sweep to Scrushy gets year removed from sentence

Aaron Kessler

Aaron Kessler

Aaron Kessler is an award-winning journalist who for nearly a decade has investigated a wide range of subjects from financial crimes by corporations and individuals, to politics and government abuses at the local, state and federal levels, to terrorist financing networks.

1 COMMENT

  1. The higher-ups in the government is very careless not knowing what is going on with Federal grants that poured in to American Samoam. The Federal should institutte a Comptroller in the territory to take care of all the milions of federal money coming into the territory and to stop this leakage in federal fund.. 

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