Film Executives Found Guilty of Conspiracy to Violate FCPA and Money Laundering Laws

17 September 2009 Publication

On September 11, 2009, Gerald and Patricia Green, Los Angeles-area film executives, were found guilty in Federal District Court for the Central District of California of conspiracy to violate the FCPA and money laundering laws of the United States, as well as of substantive violations of the FCPA and money laundering laws. Patricia Green was also found guilty of falsely subscribing U.S. income tax returns in connection with the case. The Greens were charged with paying kickbacks to the former governor of the Tourism Authority of Thailand (“TAT”) in exchange for receiving contracts to manage and operate Thailand’s yearly “Bangkok International Film Festival,” as well as contracts to provide an elite tourism “privilege card” marketed to wealthy foreigners.

The indictment specifically alleged that the Greens paid approximately $1.8 million in bribes to the former governor and, in return, received more than $13.5 million in revenue to businesses they owned. Evidence at trial showed that, in furtherance of the conspiracy, the Greens used different business entities, some with dummy addresses and information, to hide the money the Greens were paid under the contracts. Evidence also showed that the Greens disguised the bribes as “sales commission” payments and made the payments through the bank accounts of intermediaries, including bank accounts in the name of the former governor’s daughter and friend.

The Greens face a maximum penalty of 10 years in prison for the FCPA violations and a maximum penalty of 20 years in prison for each money-laundering count. Patricia Green also faces a maximum penalty of three years in prison and a fine of not more than $100,000 for the false subscription of a U.S. income tax return. Sentencing has been set for December 17, 2009.

This is the third FCPA trial of the summer to focus on individual rather than corporate activity. The other two were the matters involving former Congressman William Jefferson and investor Frederic Bourke, Jr. This could be an indication that individual activity is becoming an area of increased DOJ concern regarding the FCPA.