EXECUTIVE GUILTY OF CONSPIRACY IN FOREIGN BRIBERY CASE By BLOOMBERG NEWS
Frederic Bourke, a founder of the handbag maker Dooney & Bourke, was convicted Friday of conspiring to pay bribes to government leaders in Azerbaijan in a 1998 oil deal.
The federal jury in Manhattan returned its verdict after a monthlong trial.
Jurors found that Mr. Bourke conspired with a Czech expatriate, Viktor Kozeny, to pay bribes to the former president of Azerbaijan, Heydar Aliyev, and other leaders.
The verdict is a victory for federal prosecutors as they step up enforcement of the Foreign Corrupt Practices Act, which bars payments to foreign officials. Few criminal cases under the law ever go to trial.
“By bringing and winning the case, the government has expanded the F.C.P.A.’s coverage,” said Richard L. Cassin, the founder of the firm Cassin Law in Singapore, who also writes the FCPA blog. “This was probably the hardest F.C.P.A. prosecution the government has ever brought. Bourke didn’t pay the bribes himself, he only knew about them.”
Mr. Bourke, 63, was on trial for investing with Mr. Kozeny knowing that he gave Azeri leaders millions of dollars in cash and a secret two-thirds interest in a venture formed to buy the state oil company, known as Socar.
A lawyer for Mr. Bourke, Harold Haddon, declined to comment after the verdict.
Prosecutors said that Mr. Bourke, who lives in Greenwich, Conn., faces 10 years in prison, though Judge Shira A. Scheindlin of Federal District Court indicated that she would not impose a sentence that long .
Mr. Bourke denied knowing about the bribes. His lawyers argued that Mr. Kozeny stole more than $180 million from Mr. Bourke and other investors, including the hedge fund Omega Advisors and the insurance giant American International Group . A Bourke investment vehicle put up $8 million in the deal.
Azerbaijan, a former Soviet Republic in the Caspian Sea region, never sold Socar, wiping out the investment. Mr. Kozeny, who also has been charged, is a fugitive living in the Bahamas. He admits bribing Azeri leaders, but claims the foreign corruptions law does not apply to him.
Return