Thank you for sharing!

Your article was successfully shared with the contacts you provided.

Frederic Bourke Jr. instructed his lawyers to “build a wall” between himself and the activities of a co-conspirator who tried to bribe top officials in Azerbaijan, a prosecutor told a jury in lower Manhattan Monday. Assistant U.S. Attorney Iris Lan said Bourke “got nervous” when he realized that co-conspirator Viktor Kozeny might be running afoul of the Foreign Corrupt Practices Act by cutting deals with the president of Azerbaijan, who at the time was Heydar Aliyev, as part of a 1998 scheme to gain a majority stake in the national oil company, Socar. Bourke and other investors in the scheme, Lan said, met with their lawyers to try and build a new corporate structure that would minimize their criminal and civil exposure if a scandal broke out. “He knew for a fact that bribes were being paid,” Lan said during her closing argument in Bourke’s five-week trial, telling the jury that bribes were the way for Kozeny to get an inside track on the privatization of Socar. Bourke, 63, is charged with conspiracy to violate the Foreign Corrupt Practices Act and the Travel Act, which criminalizes travel in pursuit of bribing foreign officials to win business. Bourke, co-founder of handbag maker Dooney & Bourke, is also accused of conspiracy to commit money laundering and making false statements. He faces a maximum of 30 years in prison if convicted on all counts. Lan yesterday reminded the jury in the courtroom of Judge Shira Scheindlin that Bourke protested only briefly when he learned that Kozeny had diluted the stake of investment groups he and Kozeny established to purchase a majority share of Socar. Lan said Bourke was told that “new investors” were being brought in, investors who would secure the success of privatization. It was obvious, the prosecutor said, that those new investors were top Azeri leaders. The defense argues that Bourke knew about the Azeri officials’ involvement but believed they had paid for their stake in the project. Lan reminded the jury that Hans Bodner, a Swiss banker who has pleaded guilty and is cooperating with prosecutors, testified that when Bourke protested about the dilution of investors’ stake at a July 8, 1998, meeting, “I said, ‘Ricky, you know the arrangement.’” The defense is expected to argue during its closing today that Bodner was lying. Lan said Bourke made a pretense of being a whistleblower himself and attempted to provide law enforcement with information about his erstwhile partner, Kozeny, merely to cover his tracks after learning he was being investigated for bribery. Lan faced the jury armed with a favorable decision by Judge Scheindlin to give the jury instructions on the law of conscious avoidance. Even if the jury could not find enough evidence that Bourke actually knew that Kozeny was engaged in bribery, Lan said, they could still find Bourke “willfully avoided learning” about it and was simply “sticking his head in the sand.” Bourke allegedly invested $8 million of his own money and that of his friends and relatives through an investment group organized by Kozeny, who is currently living in the Bahamas and fighting extradition to the United States. Bourke brought former U.S. senator and current Mideast envoy George Mitchell into the investment group in 1998. Mitchell testified for the defense on June 22 that he lost $200,000 of his own money, and that when Bourke expressed outrage in 1999 over having been defrauded by Kozeny, Mitchell advised his friend, “The money’s gone. Forget about it.” (NYLJ, June 22). On Monday, Lan said Bourke brought Mitchell into the group to provide legitimacy for the Kozeny venture. “The defendant wanted the cover that George Mitchell provided — he wanted this audacious and corrupt transaction to be covered by George Mitchell,” she said. Lan said Bourke’s claim that he was actually a whistleblower who called out Kozeny for fraud was “just a show.” “He pounded the table. He did just about everything you could think of, except actually to go to the authorities,” Lan said. In fact, it was only after Bourke learned he was a target of the probe that he agreed to meet with prosecutors in an extended proffer session in 2002, she added. And when Bourke finally talked to the FBI, she said, he told agents a series of lies. “For four days, the defendant lied to the FBI,” she said. “He said he didn’t know anything about corrupt payments, bribes or gifts to the Azeris by Viktor Kozeny.” The defense, led by Harold A. Haddon of Haddon Morgan Mueller Jordan Mackey & Foreman in Denver, was expected to begin its closing argument Tuesday morning.

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.