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Energy / Utilities
China
Nationality of Foreign Officials: Chad, Uganda
Summary of Allegations:
The U.S. Department of Justice alleges that Chi Ping Patrick Ho, the head of non-governmental organization China Energy Fund Committee, and Cheikh Gadio, the former Foreign Minister of Senegal, conspired to bribe officials in Chad and Uganda so as to obtain exclusive oil rights in those countries for a Chinese oil and gas company that provided funding for Ho's organization. The company alleged to have paid the bribes was not named by DOJ, but has been identified in the press as CEFC China Energy Company. CEFC issued a statement on 22 November 2017 that denies the allegations.
Ho, with Gadio's facilitation, is alleged to have brokered CEFC's approaches to President Idriss Deby of Chad and Ugandan Foreign Minister Sam Kutesa. DOJ's complaint alleges that through Ho, CEFC offered a bribe of USD 2 million to President Deby in the form of a charitable donation, as a means to secure oil rights from the Government of Chad. Gadio, who conveyed the bribe offer to Deby, was then compensated with a payment of USD 400,000. As a result, CEFC obtained the exclusive opportunity to obtain specific oil rights in Chad, avoiding international competition.
In addition, Ho was said to have paid USD 500,000 as a charitable donation to an account designated by Ugandan Foreign Minister Kutesa. Ho allegedly also gave gifts and promised future benefits from a potential Ugandan joint venture involving CEFC and businesses linked to Kutesa and the President of Uganda. In exchange, CEFC allegedly was to obtain oil contracts and the opportunity to acquire a Ugandan bank.
Payments were allegedly made via wires transmitted through New York, NY.
In advance of a hearing on 25 April 2018, several court documents were submitted for Ho’s third bail application, which for the first time revealed CEFC by name in connection with the bribery allegations against Ho.
The court documents referenced a number of communications between Ho and CEFC, and Chinese officials. According to the documents, Ho, when in custody in December 2017, sought assistance both from China and CEFC with regards to his situation, claiming that both "the country" and the "CEFC" company were on the line.
One of the letters filed with the court details Ho's communications with the firm about his engagement with Déby and indicate that he sent a report to Ye -- the chairman of both CEFC China Energy and Ho’s think tank -- only 3 days after Ho's meeting with Deby.
In the report, Ho documented his meeting with Déby and noted that CEFC’s executive director Zang Jianjun, was also in attendance.
Teh court documents also included a letter from Zang to Déby in December 2014, referencing the commitment to make a donation totaling USD 2 million to Déby, as CEFC’s gesture of “sincere commitment” to the country’s “social actions.” Additionally, CEFC’s subsequent decision to hire Cheikh Gadio had gone through its legal department.
In December 2018, three additional UN officials were found to be implicated in the case: UN former General Assembly presidents Sam Kutesa, his predecessors Vuk Jeremic from Serbia, and John William Ashe from Antigua. Vuk Jeremic Connected Ho with Gadio and referred business to CEFC when in office. After leaving the job in the UN, Vuk Jeremic worked as a consultant for CEFC at an annual rate of US$330,000. He connected CEFC to energy and public officials, while receiving full fund by CEFC in establishing his think tank the Centre for International Relations and Sustainable Development.
Approximate Alleged Payments to Foreign Officials: USD 2 million to President of Chad, and USD 500,000 to Ugandan foreign minister.
Business Advantage Allegedly Obtained: Exclusive opportunities to obtain oil rights in Chad and Uganda, and other business advantages.
Agencies: United States: Department of Justice, United States: Federal Bureau of Investigation
Results:
Year Resolved: 2019
Compliance Monitor:
Ongoing: No
Details:
17 and 18 November 2017 - Chi-Ping "Patrick" Ho and Cheikh Gadio were arrested and charged with eight counts, including conspiring to violate the FCPA, violating the FCPA, conspiring to commit international money laundering, and committing international money laundering.
08 January, 2018 - Ho pleaded not guilty.
05 February 2018 - Ho's request to be released on a bond and placed on house arrest in Manhattan was denied.
18 May 2018 - Ho's third bail application was denied by the Federal District Court in New York, as he could be a flight risk.
20 July 2018 - a New York Southern District judge again denied Ho Chi-Ping’s appeal of bribery charges based on the court’s reading that the FPCA has jurisdiction over a non-U.S. resident serving as an agent for a U.S.-based organization or a money transfer utilizing the U.S. banking system.
Ho would face a trial on all eight counts of bribery and money laundering in this November.
10 August 2018 - the U.S. Court of Appeals in New York denied Ho Chi-Ping’s fourth appeal to be released on bail based on flight risk.
16 September 2018 - federal prosecutors dropped charges against Gadio without further explanation.
26 September 2018 - according to media, Gadio became a government witness and disclosed that Ho Chi-ping gave the president of Chad Idriss Deby a box containing $2 million cash as a “charitable donation to Chad” in December 2014.
5 December 2018 - A federal court convicted Ho Chi-Ping of one count of conspiracy to violate the FPCA and four counts of FCPA violation, and will impose sentencing in March 2019.
25 March 2019 - a U.S. court sentenced Ho to a 36-month imprisonment with a $400,000 fine.