By Joel Schectman
The trial of former PetroTiger Chief Executive Joseph Sigelman
came to an abrupt end Monday morning after the businessman admitted
bribing a Colombian official to win an oil-services contract valued
at $39 million.
Mr. Sigelman pleaded guilty in federal court in Camden, N.J., to
charges that he violated the Foreign Corrupt Practices Act by
conspiring to bribe an employee of Colombia's state-run oil company
Ecopetrol SA. Mr. Sigelman admitted that he turned a blind eye to
the fact that employee David Duran worked for Ecopetrol.
An attorney for Mr. Duran has said previously Mr. Duran
maintains his innocence and says the payments weren't bribes. The
FCPA makes it a crime to bribe foreign officials to win business.
The government considers Mr. Duran an official because of his work
at the state-owned company.
The unexpected turn of events came as the bribery trial was
about to enter its third week. The government reached the agreement
with Mr. Sigelman after a key witness, former PetroTiger general
counsel Gregory Weisman, told the court last week that he had given
false testimony regarding the demands that authorities had made as
part of his cooperation agreement. Mr. Weisman has pleaded guilty
to FCPA violations and kickback charges.
Mr. Sigelman's plea deal calls for him to receive a sentence of
between probation to one year in jail. Mr. Sigelman was charged
with FCPA violations, money laundering and taking kickbacks and
faced more than 20 years in jail if convicted, according to the
Justice Department. Mr. Sigelman pleaded guilty to one count of
conspiring to violate the FCPA, but the other charges were
dismissed, according to a court transcript. The judge will sentence
Mr. Sigelman on Tuesday.
William Jacobson, a former federal FCPA prosecutor, said the
plea agreement "sounds quite generous."
"It sounds like the government had proof problems at the end of
the day, " said Mr. Jacobson, who is now an attorney at Orrick
Herrington & Sutcliffe LLP.
The guilty plea marks an unexpected end of a closely watched
trial. The case was seen as a test of the government's ability to
win foreign bribery cases in before a jury.
Federal prosecutors have settled numerous overseas bribery cases
with corporations in recent years, extracting record penalties and
admissions of wrongdoing from companies including Alstom SA and
Avon Products Inc. But the PetroTiger case was the first FCPA
charge to face a jury decision in years, after federal prosecutors
suffered a series of stinging setbacks in other foreign bribery
trials, including two mistrials and a guilty verdict that was
tossed by a judge because of prosecutorial misconduct.
Last week, a key witness for the defense, Mr. Weisman, testified
that the government had pressured him to remain as the general
counsel for another company Mr. Sigelman ran, after he became an
undercover informant. When pressed by Mr. Sigelman's defense
attorney on the conflict of interest, Mr. Weisman said, according
to court transcripts, "I was cooperating with the government and
was told I couldn't just go and resign."
But several days later, he admitted during further cross
examination that this statement was false. "I had misremembered, a
couple days ago," Mr. Weisman said.
The defense used this admission to attack Mr. Weisman's
credibility last Thursday. "You realize that a lot of your
testimony is supported solely by your word, right?" asked William
Price, a defense counsel for Quinn Emanuel Urquhart & Sullivan,
LLP.
Shortly after the admission on Thursday morning, the two sides
asked that the court break for the week.
Write to Joel Schectman at joel.schectman@wsj.com
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