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U.S. v. Kozeny, et al.

 
:
Kozeny, Viktor
:
DOJ Criminal
:
October 6, 2005
:
U.S. v. Kozeny, et al.
:
U.S. v. Kozeny, et al., No. 05-cr-518 (S.D.N.Y. 2005)
:
As of November 2009, Kozeny had successfully resisted extradition from the Bahamas to the U.S., prevailing on the argument that the charges against him are not extraditable offenses in the Bahamas. Given the UN treaty that makes foreign bribery a crime in the vast majority of countries around the world, this argument may be less successful in preventing the extradition of other defendants in the future.
:
Energy (Non-Utility)-Oil & Gas-Exploration/Production
:
Azerbaijan
:
1997; 1998; 1999
:
A senior Azeri government official; senior official of State Oil Company of Azerbaijan Republic ("SOCAR"); two senior officials of Azerbaijan's State Property Committee.
:
In connection with the privatization of the oil industry of the Republic of Azerbaijan in the late 1990s, a group of corporations and investors (the "Investment Consortium") attempted to acquire controlling interests in SOCAR, the Azeri national oil company.

According to the initial indictment in the case, the Investment Consortium was comprised of Viktor Kozeny; his codefendants, Frederic Bourke, Jr. and David Pinkerton; two companies Kozeny controlled, Oily Rock Group Ltd. and the Minaret Group Ltd.; Oily Rock's shareholders; and other co-investors.

Kozeny was president and chairman of Oily Rock and Minaret, two U.S. corporations engaged in activities relating to the acquisition of Azeri government vouchers and options in SOCAR. Two other investment companies, Omega Advisors, Inc. and Pharos Capital Management, L.P., both entered into co-investment agreements with Oily Rock and Minaret. According to the indictment, the defendants paid millions of dollars in the form of (1) cash and wire transfers to Azeri officials and family members; (2) promises of two-thirds of profits realized in the privatization of SOCAR; (3) transfer of Investment Consortium vouchers and options; (4) issuance of approximately $300,000,000 worth of Oily Rock shares; (5) jewelry and luxury items in excess of $600,000; and (6) medical, travel, and gift expenses to Azeri officials.

Kozeny, in particular, is accused of participating in a series of meetings with SOCAR officials ending in the agreement that the officials would, among other benefits, receive two-thirds of the Oily Rock's vouchers and options and two thirds of the Investment Consortium's profits from SOCAR. In exchange for these payments, Azeri officials allegedly allowed the Investment Consortium to continue to participate in Azeri privatization, to privatize SOCAR, and acquire a controlling interest in SOCAR.

A Bahamian court ruled in October 2007 that Kozeny cannot be extradited to the U.S., stating, inter alia, that the FCPA charges against Kozeny were not provable or prosecutable under Bahamian law. In December 2009, prosecutors in the Bahamas appeared before the Bahamian Court of Appeals, attempting to overturn the order against extradition.

In February 2009, the district court issued a post-indictment restraining order freezing Kozeny's assets subject to forfeiture, including the proceeds from the sale of a Colorado residence amounting to approximately $23 million.
:
Anti-bribery (Domestic Concern), Conspiracy - Anti-Bribery
:
Conspiracy - Money Laundering, Conspiracy - Travel Act, Money Laundering, Travel Act
:
Fugitive
:
Not stated.
:
0
:
Agent of Domestic Concern
:
Board Chairman, Founder, President, Shareholder
:
Foreign
:
Legislation
:
Not stated.
:
Cash, Entertainment, Gifts, Meals, Travel, Wire/check
:
Direct, Family Member
:
313,000,000
:
Azerbaijan
:
Azerbaijan, Netherlands, Switzerland, United States
:
No