Chicago:
A Congress MP is among six persons charged in the US for their suspected role in an international corruption scheme involving bribes worth $18.5 million to government officials in India to allow the mining of titanium minerals in Andhra Pradesh.
A federal five-count indictment, returned under seal in June 2013 and unsealed in Chicago on Wednesday, charges Rajya Sabha MP K V P Ramachandra Rao, 65, and five others with one count each of racketeering conspiracy and money laundering and two counts of interstate travel in aid of racketeering.
Apart from Mr Rao, the others charged are Hungarian businessman Andras Knopp, 75, Suren Gevorgyan, 40, of Ukraine, Gajendra Lal, 50, an Indian national and permanent resident of the US who formerly resided in Winston-Salem, North Carolina, and Periyasamy Sunderalingam, 60, of Sri Lanka.
Five defendants, excluding Mr Rao, were charged with one count of conspiracy to violate the Foreign Corrupt Practices Act (FCPA).
Mr Rao was an official of the state government of Andhra Pradesh and a close advisor to former Chief Minister of Andhra Pradesh, late Y S Rajasekhara Reddy.
One defendant, Dmitry Firtash 48, a Ukrainian national was arrested on March 12 in Vienna.
Firtash was released from custody on March 21 after posting about US $174 million in bail.
"Fighting global corruption is part of the fabric of the Department of Justice," Acting Assistant Attorney General David A O'Neil of the Department of Justice's Criminal Division said.
"The charges against six foreign nationals announced today send the unmistakable message that we will root out and attack foreign bribery and bring to justice those who improperly influence foreign officials, wherever we find them," he said.
Beginning in 2006, the defendants allegedly conspired to pay at least US $18.5 million in bribes to secure licenses to mine minerals in Andhra Pradesh.
The mining project was expected to generate more than US $500 million annually from the sale of titanium products, including sales to unnamed "Company A", headquartered in Chicago.
The indictment seeks forfeiture from all six defendants of more than US $10.59 million.
The indictment alleges that these individuals used US financial institutions to engage in the international transmission of millions of dollars for the purpose of bribing Indian public officials to obtain approval of the necessary licences for the project.
They allegedly financed the project and transferred and concealed bribe payments through an international conglomerate of companies named Group DF.
They have been accused of using threats and intimidation to advance the interests of the enterprise's illegal activities.
According to the indictment, Firtash was the leader of the enterprise and caused the participation of Group DF companies in the project.
Firtash allegedly met with Indian government officials, including the then Chief Minister Y S Rajasekhara Reddy, to discuss the project and its progress.
He authorised payment of at least US $18.5 million in bribes to both state and central government officials in India to secure the approval of licences for the project.
Firtash also allegedly directed his subordinates to create documents to make it falsely appear that money transferred for the purpose of paying these bribes was transferred for legitimate commercial purposes and appointed various subordinates to oversee efforts to obtain the licenses through bribery.
As alleged in the indictment, Knopp supervised the enterprise and together with Firtash met Indian government officials.
Knopp also met with Company A representatives to discuss supplying titanium products from the project.
Gevorgyan allegedly traveled to Seattle and met Company A representatives. He also engaged in other activities, including allegedly signing false documents, monitoring bribe payments and coordinating transfers of money to be used for bribes.
Lal, also known as "Gaj", allegedly engaged in similar activities, reported to Firtash and Knopp on the status of obtaining licences and recommended whether and in what manner to pay certain bribes to government officials.
The indictment alleges that Sunderalingam met with Mr Rao to determine the total amount of bribes and advised others on the results of the meeting.
Sunderalingam identified various foreign bank accounts held in the names of nominees outside India that could be used to funnel bribes to Mr Rao, the indictment alleges.
Mr Rao allegedly solicited bribes for himself and others in return for approving licenses for the project and he warned other defendants concerning the threat of a possible law enforcement investigation of the project, it says.
The indictment lists 57 transfers of funds between various entities, some controlled by Group DF, in various amounts totaling more than US $10.59 million beginning April 28, 2006, till July 13, 2010.
The indictment seeks forfeiture from Firtash of his interests in Group DF Limited and its assets, including 14 companies registered in Austria and 18 companies registered in the British Virgin Islands, as well as 127 other companies registered in Cyprus, Germany, Hungary, the Netherlands, Seychelles, Switzerland, the UK and one unknown jurisdiction and all funds in 41 bank accounts in many of those countries.
Furthermore, the indictment seeks forfeiture from all six defendants of more than US $10.59 million.
As alleged in court documents, Firtash controls Group DF, an international conglomerate of companies that was directly and indirectly owned by Group DF Limited, a British Virgin Islands company.
Group DF companies include: Ostchem Holding AG, an Austrian company in the business of mining and processing minerals, including titanium, Global Energy Mining and Minerals Limited, a Hungarian company, and Bothli Trade AG, a Swiss company, for which Global Energy Mining and Minerals was the majority shareholder.
In April 2006, Bothli Trade and the state government of Andhra Pradesh agreed to set up a joint venture to mine various minerals, including ilmenite, a mineral which may be processed into various titanium-based products such as titanium sponge, a porous form of the mineral that occurs in the processing of titanium ore, the Department of Justice said.
In February 2007, Company A entered into an agreement with Ostchem Holding, through Bothli Trade, to work toward a further agreement that would allow Bothli Trade the ability to supply 5 million to 12 million pounds of titanium sponge from the Indian project to Company A on an annual basis.
The mining project required licenses and approval of both the Andhra Pradesh state government and the central government of India before the licenses could be issued.