Two former senior executives of Latin Node Inc. (LatiNode), a Miami-based telecommunications company, have been charged with bribing more than $500,000 to Honduran government officials and laundering money.
Jorge Granados and Manuel Caceres, the former chief executive officer and the vice president of business development of LatiNode have been charged with criminal violations of the anti-bribery provisions of the Foreign Corrupt Practices Act (FCPA), and international money laundering.
The 19-count indictment returned by a federal grand jury in Miami on Dec. 14 was unsealed on Dec. 20, the same day Granados and Caceres were arrested.
They face more than 20 years in prison and a fine of greater than $500,000 or twice the value of the monetary instrument or funds involved in the offense if convicted for the charges. The indictment also gives notice of criminal forfeiture.
On April 7, 2009, LatiNode pleaded guilty for the charges with a criminal violation of the FCPA. As part of the plea agreement, the firm agreed to pay a $2 million fine.
Granados and Caceres are accused of paying more than $500,000 from September 2006 to June 2007 to a manager and a lawyer of Empresa Hondureña de Telecomunicaciones (Hondutel), the wholly state-owned telecommunications authority in Honduras.
They have also been accused of paying money to a Honduran official who became a representative of Hondutel board of directors.
According to court documents, in December 2005, LatiNode had won a contract and made an 'interconnection agreement' with Hondutel. The agreement permitted LatiNode to use Hondutel’s telecommunications lines. The firm was required to pay Hondutel a set rate per minute for calls to Honduras.
The defendants sought a reduction in the rates payable to Hondutel after winning the contract. They came to know that a newly elected high-ranking government official's friend had been made a manager of Hondutel, who considered rescinding the agreement with LatiNode, the Justice Department statement said.
Caceres allegedly informed Granados and an another executive by e-mail that it would be necessary to 'give' something to the Hondutel general manager. I will try this with the manager.
Caceres said that he would 'meet with these criminals', adding But I will solve this problem for you, I promise. Not only will we get a preferential of preferentials rate but the capacity we need. I have some things to reveal to them in exchange for what I'm going to ask of them.
The defendants and other executives agreed to a secret deal to pay bribes to the manager, a senior attorney for Hondutel who acted as the manager's straw man, and to a minister of the Honduran government who became a representative on the Hondutel board of directors, according to the indictment.
The bribes were paid in exchange for keeping the agreement in place, receiving reduced rates, and other economic benefits from Hondutel.
According to the indictment, between September 2006 and June 2007, Granados approved the payments, and another LatiNode executive facilitated the wire transfers of more than $500,000 in bribes to the officials, concealing many of the payments by laundering the money through LatiNode subsidiaries in Guatemala and to accounts in Honduras controlled by the Honduran government officials.
In early 2007, when eLandia International Inc., a telecommunications holding company based in Coral Gables, Florida, acquired LatiNode, the defendants grew concealed the illicit payments during the acquisition due diligence process.
Specifically, according to the indictment, Granados allegedly urged Caceres to formalize the secret rate reduction deal with the Honduran officials, as the issue could cause a HUGE problem during the process. The defendants also allegedly urged the Honduran officials to sign fraudulent consulting contracts that would disguise the true nature of the relationship. Caceres explained to the officials in an e-mail that, no government official can appear on the consulting contract, and that future payments will come from eLandia through Servicios IP, a firm of ours in Guatemala.
The bribery allegations were disclosed to the government by eLandia after its acquisition of LatiNode and discovery of the improper payments.
Foreign bribery, like domestic corruption, breeds instability and undermines democratic processes, said Lanny A. Breuer, assistant attorney general.
As this indictment and the previous guilty plea by LatiNode show, the department is committed to holding accountable individuals and companies alike for alleged foreign bribery schemes, Breuer said.
This new indictment represents the FBI's commitment to investigating not just the corrupt acts of a corporate entity, but the individuals who are behind it, said John V. Gillies, special agent-in-charge of FBI's Miami Division.