The former owner and president of Chestnut Consulting Group Inc. and Chestnut Consulting Group Co. was indicted by a federal grand jury for his alleged participation in a scheme to pay bribes to a foreign official in violation of the Foreign Corrupt Practices Act (FCPA) and the Travel Act, and to launder proceeds of those crimes.
Dmitrij Harder, 42, of Huntingdon Valley, Pennsylvania, the former owner and president of the Chestnut Group, was charged with one count of conspiracy to violate the FCPA and Travel Act, five counts of violating the FCPA, five counts of violating the Travel Act, one count of conspiracy to commit international money laundering, and two counts of money laundering.
The European Bank for Reconstruction and Development (EBRD) was a multilateral development bank headquartered in London, England, and was owned by over 60 sovereign nations.
Among other things, the EBRD provided financing for development projects in emerging economies, primarily in Eastern Europe.
Federal officials alleged that Harder and others paid bribes for the benefit of a senior official at the EBRD in exchange for influencing the official’s actions on applications for financing submitted by the Chestnut Group’s clients and for directing business to the Chestnut Group.
The EBRD ultimately approved applications for financing from two of the Chestnut Group’s corporate clients.
The first resulted in the EBRD providing an $85 million investment and a 90 million Euro loan, while the second resulted in a $40 million investment and a $60 million convertible loan.
The Chestnut Group allegedly earned approximately $8 million in “success fees” as a result of the EBRD’s approval of these two applications.
The indictment alleges that Harder made five payments totaling more than $3.5 million to the sister of the EBRD official, in part as an effort to conceal the bribes.
These payments were allegedly made for purported consulting and other services provided to the Chestnut Group by the official’s sister, when in fact she provided no such services.
Harder also allegedly participated in creating fake documents to justify these payments.