Contractor to Pay $7.1M |to Settle DOJ Bribes Case

     (CN) – A Florida defense contractor will pay $7.1 million to end a federal investigation in whether the company bribed Kuwaiti officials to secure a lucrative contract.
     In a related move, James Rama, a former vice president of IAP Worldwide Services Inc., pleaded guilty on Tuesday to conspiracy to violate the Foreign Corrupt Practices Act for his involvement in the bribery scheme.
     According to the Justice Department, Kuwait’s Ministry of the Interior launched an initiative in 2004 to provide nationwide surveillance capabilities for several government agencies. The project was to be undertaken in two phases.
     The government said IAP and Rama schemed to ensure the company was hired as a consultant during phase 1 of the proejct so that it could tailor the requirements for phase 2 to conform to its own strengths, giving it an advantage in the second stage of bidding.
     Both IAP and Rama admitted to investigators that in February 2006, executives and senior employees with the firm set up a shell company — “Ramaco” – to conceal IAP’s role in crafting the phase 2 requirements and its conflict of interest in connection with securing the phase 2 contract, the Justice Department said.
     The government said Ramaco secured the Phase I contract for approximately $4 million, and arranged for half that amount to be diverted to a consultant who would pay bribes to Kuwaiti government officials.
     IAP and Rama admitted that they disguised the payments by transferring funds Ramaco received to an IAP bank account and then to the consultant through a series of accounts and intermediaries, investigators said.
     All told, IAP and its co-conspirators paid the consultant approximately $1,783,688 understanding that some or all of the funds would be used to bribe Kuwaiti government officials, the government said.
     The Justice Department did not divulge why it decided to enter into a non-prosecution agreement with the company.
     The agreement requires IAP to conduct a review of its existing internal controls, policies and procedures, and make any necessary modifications to ensure that the company maintains accurate record keeping and a rigorous anti-corruption compliance program.
     It further requires the company to report periodically to the Justice Department’s Criminal Division and to the U.S. Attorney’s Office for the Eastern District of Virginia regarding remediation and implementation of the compliance program and internal controls, policies and procedures.
     Rama, of Lynchburg, Virginia, pleaded guilty before U.S. District Judge James C. Cacheris to one count of conspiracy to violate the anti-bribery provisions of the FCPA.
     He is scheduled to be sentenced on Sept. 11, 2015.

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