DOJ Recommends 15 Months for Exec in Bribery Case

The Wall Street Journal on September 10, 2012 released the following:

“By C.M. Matthews

The Justice Department said a former executive of an industrial valve manufacturer who admitted to authorizing bribes in China should be sentenced to 15 months in prison.

Federal prosecutors recommended the sentence for Paul Cosgrove, former director of international sales for Control Components Inc., in court papers filed in federal district court in Santa Ana, Calif. last week. But, the prosecutors also said they wouldn’t oppose 15 months of home confinement because of Cosgrove’s health problems.

Cosgrove pleaded guilty in May to violating the Foreign Corrupt Practices Act, which prohibits improper payments to foreign officials to win business. He was charged along with five other former Control Components executives in April 2009 in connection with an alleged bribery scheme. Two other Control Components executives were also charged in a related matter in 2009.

According to court documents, Cosgrove approved improper payments in connection with a sprawling, global bribery scheme to win contracts for Rancho Santa Margarita, Calif.-based Control Components. So far, five other former CCI executives have pleaded guilty to charges stemming from the alleged scheme. Control Components pleaded guilty in July 2009 to violating the Travel Act, which prohibits commercial bribery, and the FCPA. The company paid an $18.2 million criminal penalty and agreed to implement rigorous internal controls.

Prosecutors said last week that they could not dispute a probation office report that said Cosgrove has “serious health issues.” Cosgrove had quadruple bypass surgery in 2010, according to court documents, and suffers from chronic health problems including heart disease and diabetes. The report recommended three years of probation and six months of home confinement for Cosgrove.

But prosecutors said that was an inadequate sentence because, “the sentencing end of deterrence in FCPA cases is important as the statute is intended to combat a culture of corruption that could otherwise undercut the business development and good governance of nations around the world.” While Cosgrove’s conduct warranted jail time, they said they would not object to home confinement, so long as it was for at least 15 months.

“To the extent the Court concludes that these factors outweigh the aggravating factors which would otherwise warrant a sentence of imprisonment within the guidelines range, any period of home confinement should be as long as the otherwise-applicable term of incarceration,” they wrote. “To state it differently, the government sees nothing in the Probation Officer’s analysis which would warrant only six rather than 15 months of home detention.”

The prosecutors also said Cosgrove should pay up to $20,000 in fines.

Cosgrove’s lawyers have filed their own sentencing memorandum under seal. They didn’t immediately respond to a request for comment.

Cosgrove’s sentencing is scheduled for Sept. 13”


Douglas McNabb – McNabb Associates, P.C.’s
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