Philly Viets indicted for bribing Vietnamese officials

Three Vietnamese-Americans, brothers and sister, were indicted by a federal grand jury for paying bribes described as “commissions” to Vietnam’s government officials to facilitate the sale of U.S. goods to state-owned companies controlled by those officials.

The indictment was reported by the Philadelphia Inquirer here. The paper posted a PDF copy of the indictment here.

According to the indictment, Nam Quoc Nguyen, 52; Kim Anh Nguyen, 39; An Quoc Nguyen, 32, paid at least $150,000 in bribes to officials to obtain export contracts for the company they own, Nexus Technologies, Inc. Also indicted was Joseph T. Lukas, 59, a Nexus employee.

The goods sold by the Nguyen brothers and sister were all big-ticket items: underwater mapping equipment, bomb containment equipment, helicopter parts, chemical detectors, satllite communication parts, and air tracking systems.

The federal grand jury accuses these defendants of violating the Foreign Corrupt Practices Act. Allegedly, they created a Hong Kong corporation. Nexus would pay the Hong Kong company, and then that company would route money to the corrupt officials. Presumbably they thought that would fool people. Duh!

The company’s customer list also reads like a Who’s Who of state-owned enterprises: VietSov Petro, PetroVietnam Gas Company, Vung Tau Airport, Southern Flight Management Center, and a tourism and trading company that allegedly belongs the Ministry of Public Safety, which includes all police operations, from the corner traffic cops to big-time espionage.

VietSov Petro, whose name dates back from the Cold War days when its partner was still called the Soviet Union, has a share in every oil and gas well drilled on Vietnam’s continental shelf.

PetroVietnam (in Vietnamese: Tap Doan Dau Khí Quoc Gia Viet Nam) is the state-owned company that holds the monopoly on all things having to do with oil. Every drop of gasoline sold in the country must go through PetroVietnam. It is the named Vietnamese partner in VietSov. It also branches out into related and unrelated businesses, such as tourism, transportation, power generation, etc. Some have claimed that, behind the scene, the head of PetroVietnam is the most powerful man in the country. Its subsidiary PetroVietnam Gas (in Vietnamese: Tong Công Ty Khí ) is the exclusive importer/distributor/wholesaler of natural gas.

The alleged corrupt dealings include:

* In 2000, they paid some unknown amount of “commission” to a “supporter” within PetroVietnam Gas Company (PVGC).

* In 2001, they deducted part of the commission because the payment they got from PVGC was less than expected. (Hahahahahah, laughs the Bolsavik as he rolls on the floor.)

* Also in 2000, they paid 15% of some contract to someone at VietSov Petro. Lukas, the indicted co-defendant, apparently new to the bribing business, had to ask Nam how much commission was paid so he could record them in the books.

How much is 15%? In 2003, they got to sell more than $500,000 to VietSov Petro for a hydraulic jacking system. You do the math.

In 2006, they sold a wheel shot blast to VietSov Petro. It is not clear how much that cost, but the way they won the bid was to rig it, so that two other companies would submit higher bids, there would be 3 bids and theirs would be lowest and therefore win.

* In 2001, Lukas, apparently still not understanding how bribes work, sent Nam a breakdown of costs on a contract with Vung Tau Airport and asked Nam which portions need to be paid commission on. To which Nam responded the next day, well, duh, everything, that an airport official had “demand[ed] commissions” for all sales.

* In 2004, they wired commission payout to PVGC on some spare parts contract. Apparently someone didn’t wire fast enough, so from Vietnam Nam emailed his sister Kim Anh with an email marked “URGENT” telling her to wire the $9,798.40 “commission payout” “TODAY.”

* In 2004, they sold $14,000 of computer workstations to Southern Flight Management Center (in Vietnamese: Trung Tâm Quan Ly Bay Mien Nam), a air-traffic-control arm of Vietnam Airlines. In an email, Nam bragged to his siter Kim Anh: “SFMC could have bought this … equipment from a local dealer for cheaper than ours. But they agreed to buy from us since we can … agree for them to add into the contract a fat markup for themselves.”

* Also in 2004, they sold air traffic system equipment to Vung Tau Airport, and paid 10% of the contract in “commission.” They paid $18,854.

In 2006, they paid another $63,360 to a Vung Tau Airport official, also on the air traffic system contract.

Later that year, they paid the “2nd commission payment” of $14,200, to that same official.

* In 2005, for some safety equipment contract with the Ministry of Public Security company, they paid $21,872 to the official in charge. The grand jury quoted an email they sent to the official, in which they confirmed they had wired $22,325 to Hong Kong, and from Hong Kong they would wire $21,872 to the official after deducting bank fees.

According to the Philadelphia Inquirer, if convicted of all charges, Nam Quoc Nguyen faces a maximum sentence of 25 years and a $650,000 fine; Lukas faces a maximum of 10 years and a $350,000 fine; Kim Anh Nguyen faces a maximum of 20 years and a $550,000 fine; and An Quoc Nguyen faces a maximum of 5 years and a $250,000 fine.

Nexus Technologies faces a maximum possible fine of $10 million, authorities said.