U.S. businessman guilty in Azerbaijan oil case

By Grant McCool

NEW YORK (Reuters) - An American businessman and friend of U.S. diplomat George Mitchell was found guilty on Friday of conspiracy to defraud the United States in an Azerbaijan oil venture bribery case.

Frederic Bourke, co-founder of handbag maker Dooney & Bourke, was found guilty by a Manhattan federal court jury of breaking the U.S. Foreign Corrupt Practices Act and of making false statements.

Bourke, 63, was found not guilty of conspiracy to commit money laundering, which carried a maximum sentence of 20 years imprisonment. Bourke faces a maximum of five years imprisonment plus $250,000 fines on each conviction. He is free on bail.

The charges against Bourke were made in 2005 in connection with an alleged conspiracy by another businessman, Czech national Viktor Kozeny, to bribe officials of Azerbaijan in a 1998 deal to buy a state-run oil company known as Socar.

Kozeny lives in the Bahamas and is fighting extradition.

Bourke's attorney John Cline said he is likely to appeal the two guilty verdicts.

"We will continue to fight on Ric Bourke's behalf," Cline told reporters.

During the trial, which began on June 2, the jury heard testimony from former senator Mitchell, President Barack Obama's envoy to the Middle East, that he had invested $200,000 in 1998 through his friend Bourke.

U.S. prosecutors accused Bourke of investing $8 million with Kozeny knowing that he was paying millions to senior leaders of the former Soviet republic. The government alleged Kozeny wanted to buy Socar and resell it.

Bourke, of Greenwich, Connecticut, denied knowledge of the bribes and accused Kozeny of stealing more than $180 million from him and other investors.

The jury foreman, electrician David Murphy, 52, said the panel believed Bourke was aware of the bribes.

"We thought he knew. He definitely should have known," Murphy told reporters after the verdicts were announced. "He's an investor. It's his job to know."

According to government witnesses, Kozeny wanted Mitchell in the deal to lend it more legitimacy.

In January 1999, Mitchell withdrew from involvement in the investment. He said in court that Bourke had told him that he had suspicions that Kozeny was involved in a fraud.

Mitchell said he told Bourke at the time: "You should just get out."