Richard Bistrong on FCPA Compliance and What Actually Happens

Richard Bistrong was a vice president for sales for a military contractor — Armor Holdings.

Then one day, his lawyer got a call from the Justice Department.


Long story short — he spent three years undercover gathering evidence on foreign bribery.

The Justice Department did criminally prosecute 22 individuals based on the evidence that Bistrong collected. But those prosecutions eventually collapsed — and all 22 executives were let go.

Bistrong however pled guilty to one count and spent 14 months in federal prison in Lewisburg, Pennsylvania.

He’s now out under supervised release — giving speeches to corporations and legal conferences about how to deter foreign bribery.

Bistrong says that the call he got from the Justice Department changed his life and in retrospect he’s happy he got the call.

He’s now president of his own company — Front Line Anti-Bribery.

“My experience with foreign bribery started early on in my international career,” Bistrong told Corporate Crime Reporter. “I was nodding to conversations where third parties and intermediaries were sharing with me in very colorful and rich language — that involved many words other than the word bribe — that they were paying bribes.”

“I moved from nodding to much more later. By the time I was called in by the Justice Department, I was thinking corruptly, I was behaving corruptly and I was acting corruptly. Even though I had been terminated by my former employer and I had started a new business, I’m not so sure I would have stopped that way of life on my own.”

You ended up cooperating with the Justice Department for five years?

“It was five years,” Bistrong said. “About three of those years were covert cooperation. It also included covert cooperation with the City of London police. And there were two years of trial preparation and trial testimony. All in all, it was five years of cooperation.”

You were wearing a wire, you were meeting with former friends and colleagues?

“I was facing a five year maximum incarceration based on a one count conspiracy charge as per my plea agreement,” Bistrong said. “I had received immunity from prosecution in the United Kingdom as a result of my cooperation there. I wasn’t facing any incarceration in the United Kingdom, but I was facing up to five years in the United States.”

“The government came in with a departure letter to home confinement. Judge Richard Leon, based on what he called the need for criminal deterrence, thought that some departure was warranted, but not all the way to zero time. So he sentenced me to 18 months. With good time and home confinement, I served about 14 months. I was released in December 2013.”

“I am now serving three years of supervised release. Under supervised release, you have certain responsibilities of monthly reporting to your supervising officer. There are certain travel restrictions.”

You spent your 14 months at the federal prison camp at Lewisburg, Pennsylvania. What can you say about the time you spent there?

“When I was sentenced, Judge Leon said that I should spend my time there productively. At the time, I didn’t know what that meant. I did some research and found out that Lewisburg had an established education program. Given my experience in my graduate studies, which included teaching for a semester at the University of Virginia, I decided that was something I wanted to do — certainly to help other inmates who did not have the educational opportunities and resources that I did. So, I became a GED instructor and also an English as a second language instructor. I found that to be a rewarding experience. I felt like I was able to make a contribution.”

How did prison change you?

“There were certain negative health consequences as a result of my incarceration — which I had to deal with and which I dealt with successfully when I got home.”

“It makes you appreciate your liberty, without a doubt. But let’s put 14 and a half months in the context of federal sentencing — especially when you look at the mandatory minimum sentences that drug offenses have brought — five years for marijuana, ten years for cocaine and crack — which is a subject of great controversy right now.”

“What I learned very early on was that 14 and a half months of incarceration when I’m surrounded by people serving five and ten year sentences made me appreciate that I was going to be going home rather quickly. I could see a light at the end of the tunnel where others around me didn’t have that.”

What is your nutshell speech to corporations?

“I look at the bell curve of human behavior. There are those who are incorruptible. No matter what temptation they might face, they are going to behave ethically in all of their work. If the culture is unethical, they are going to find another job. Then there are those who are permanently corrupt and will find a way to work around whatever rules and procedures might be put in place for their own personal benefit. In the middle of that bell curve are those individuals and teams who struggle with anti-bribery issues.”

“I had my own perfect storm of rationalizing bribery. That includes the illusion that it is a victimless crime, what it’s like to work in win big/lose big unstable sales environments, what the impact of strategy, forecast and strategies are on front line thinking. And I share that experience as a real world journey to where compliance organizations, commercial teams and audit teams can look at that experience and say — does this provide us with any real world tipping points for our front line teams so that we can better calibrate our compliance programs to the real world risk that individuals face?”

“Part of what I do is try to get the conversation going around — what actually happens.”

You have suggested the use of debarment as a way to deter bribery.

“I’m speaking as one who was debarred. I cannot be a government contractor for a limited term. During that term, I cannot engage in any government contracting.”

“The unfortunate part of debarring a company is that it impacts innocent employees who had nothing to do with the fraud as well as customers who might need those products. There are collateral consequences.”

“Law professor Brandon Garrett argues in his book Too Big to Jail that prosecutors are right to try and avoid collateral damages of a criminal prosecution. Deferred and non prosecution agreements and the fines that accompany them are abstract at the front line. They don’t impact marketplaces or sales teams. Debarment does. Debarment impacts people. It impacts marketplaces. It impacts business teams. And that creates a tremendous amount of internal peer to peer pressures for people to avoid individual decisions that could have an adverse impact on a much greater group — even if it is a request for a small bribe.”

Sales people on the ground might discount a big fine against the company, but debarment would hit home?

“Definitely — provided that the company emphasizes that the risk could be debarment. There is no magic potion or single platform. Debarment certainly has a higher degree of impact and relevance to front line teams.”

[For the complete q/a transcript of the Interview with Richard Bistrong, see page 29 Corporate Crime Reporter 42(13), November 2, 2015, print edition only.]

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