December 5, 2015 / 12:33 AM / 4 years ago

Ex-brokerage executive gets two years in U.S. prison over Venezuelan bribes

NEW YORK (Reuters) - A former executive at a Wall Street brokerage was sentenced to two years in prison on Friday for engaging in a scheme to pay millions of dollars in bribes to officials at Venezuelan state-owned development banks for trading business.

Ernesto Lujan, (R) a former managing partner at Direct Access Partners exits U.S. District Court following his sentencing hearing in the Manhattan borough of New York City, December 4, 2015. REUTERS/Mike Segar

Ernesto Lujan, a former managing partner at New York-based Direct Access Parters who oversaw its Miami offices, was also ordered by U.S. District Judge Denise Cote in Manhattan to forfeit the $18.5 million in profits he derived from the scheme.

Lujan’s lawyer had sought leniency, noting that prosecutors considered his client’s cooperation vital to bringing charges against Benito Chinea, Direct Access Partners’ ex-chief executive, and Joseph DeMeneses, a managing director.

But Cote, who sentenced both men in March to four years in prison after they pleaded guilty, said sentencing Lujan to prison as well would send a “clear message about the enormity of this conduct and the consequences that come with it.”

Lujan, who pleaded guilty in 2013 to charges including that he violated the Foreign Corrupt Practices Act, choked up as he apologized for his conduct.

“I have no excuse for my actions,” he said.

Lujan, 52, was one of six individuals criminally charged as part of a U.S. probe into foreign bribery involving the firm and Venezuelan state-owned development banks.

Prosecutors said Direct Access made more than $60 million in fees from trading business directed to it by a senior official at Caracas-based Banco de Desarrollo Económico y Social de Venezuela, known as Bandes.

Direct Access employees in turn sent $5 million to that official, Maria de los Angeles Gonzalez de Hernandez, generally through bank accounts she controlled in Switzerland and elsewhere, prosecutors said.

Prosecutors said Direct Access employees including Lujan also engaged in a similar scheme to bribe an official at another Venezuelan development bank called Banfoandes for trading business.

The scheme was uncovered during a periodic U.S. Securities and Exchange Commission review. Federal prosecutors and the SEC announced their initial cases in May 2013, helping push Direct Access’s parent company into bankruptcy.

Lujan was arrested a month later, and along with two other employees, Jose Alejandro Hurtado, and Tomas Alberto Clarke Bethancourt, pleaded guilty in August 2013.

Gonzalez, who was also charged, pleaded guilty in November 2013 and like Lujan, Hurtado and Clarke agreed to cooperate with authorities. All three are scheduled to be sentenced in the coming weeks.

The case is U.S. v. Lujan, U.S. District Court, Southern District of New York, No. 13-cr-671.

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