Two former employees of a New York broker-dealer pleaded guilty on Thursday to conspiring to pay kickbacks to Venezuelan state banking officials, as U.S. prosecutors moved to broaden their case.
Tomas Alberto Clarke Bethancourt, 43, and Ernesto Lujan, 50, admitted to participating in the conspiracy to help secure trading business for their employer, Direct Access Partners.
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Federal prosecutors in New York previously said Direct Access Partners made more than $60 million in fees from trading business allegedly directed to it by an official at Caracas-based Banco de Desarrollo Econ��mico y Social de Venezuela, known as Bandes.
But the case has now expanded as Thursday's pleas linked Direct Access to a second state-owned bank, San Cristobal-based Banfoandes, which the Venezuela government shut down in 2009.
In court, Clarke, a former executive vice president at the broker-dealer in its Miami office, said that, by 2009, he had been aware that some fees that Direct Access paid to a foreign finder were split with an unnamed Banfoandes official.
"In other words, that official was being paid to send DAP business in furtherance of the scheme," Clarke said, referring to Direct Access.
A representative for Bicentenario Banco, the successor to Banfoandes, did not immediately respond to a request for comment.
The Banfoandes official would be at least the third Venezuelan state banking official the U.S. government has said received payments from people tied to Direct Access.
A civil forfeiture action filed in May cited an unnamed second Bandes official who also received payments.
Two other individuals have also been charged criminally in the conspiracy, including former Bandes official Maria De Los Angeles Gonzalez de Hernandez, who prosecutors said received more than $5 million of kickbacks. Gonzalez was arrested in May with Clarke and defendant Jose Alejandro Hurtado. Lujan was arrested in June.
In the wake of the arrests, Direct Access Group LLC, the broker-dealer's parent, filed for Chapter 11 bankruptcy protection in July after creditors had begun an involuntary Chapter 7 case.
Clarke and Lujan both pleaded guilty to six criminal counts, including conspiracy to violate the Foreign Corrupt Practices Act, and agreed to cooperate with prosecutors. They also admitted to obstructing an examination by U.S. Securities and Exchange Commission by destroying emails.
The SEC has filed a related civil case against five people with ties to Direct Access, including Clarke and Lujan.
Neither a lawyer for Gonzalez nor representatives for Direct Access responded to requests for comment.
The case, in the U.S. District Court, Southern District of New York, are U.S. v. Clarke Bethancourt, No. 13-cr-00670.
(The story corrects 12th paragraph to say law at issue is the Foreign Corrupt Practices Act; corrects spelling of Banfoandes in paragraph 8.)
(Reporting by Nate Raymond in New York. Editing by Andre Grenon)