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Wal-Mart Mexico

One in five Wal-Mart stores is in Mexico, thanks to millions in bribes paid around the country.

The U.S. Department of Double Standards

Corporate criminals go free while the Justice Department targets those without expensive lawyers and lobbyists.

BY Leonard C. Goodman

It's not that the DOJ doesn't criminally prosecute people who pay bribes... The feds prefer to bring such cases against people who don't have access to corporate lobbyists.

On April 21, The New York Times reported that Wal-Mart de Mexico paid $24 million in bribes to local land use officials in exchange for allowing the company to build stores in virtually every corner of the country, and to make environmental objections vanish. Although its top executives apparently approved of and helped conceal the bribery scheme – in violation of the Foreign Corrupt Practices Act – the chances that any of them will face criminal prosecution is remote.

It’s not that the U.S. Department of Justice (DOJ) doesn’t criminally prosecute people who pay bribes to avoid land-use restrictions on their property. Rather, the feds prefer to bring such cases against people who don’t have access to corporate lobbyists – or even to private lawyers. According to Bureau of Justice statistics, just one in five felony defendants has private counsel.

Consider the case of Dumitru Curescu, a former janitor who recently faced two federal trials for the crime of paying $10,000 to an expediter for help obtaining a permit to build two additional garden apartments in his 13-unit building on Chicago’s North Side. Curescu, an immigrant from communist Romania who became a naturalized U.S. citizen in 1988, was advised by his architect in 2006 to hire the expediter Catherine Romasanta, when he did his first renovation project. But when he called her again in 2007, she was working as an informant for the feds and recording their calls.

In the fall of 2007, Curescu paid Romasanta the agreed-upon fee and received his building permit. Seven months later, with the renovations nearly complete, federal agents arrested Curescu and his wife Lavinia and seized their building. The feds charged both husband and wife with five counts of bribery and conspiracy.

Financially ruined, the couple chose to fight the case; I was Curescu’s court-appointed counsel. During a three-week jury trial, federal prosecutors played tapes of Curescu’s negotiations with Romasanta and argued to the jury that he and Lavinia knowingly passed a bribe through Romasanta to a city official to get around Chicago’s zoning restrictions.

The jury acquitted Lavinia on all charges but failed to reach a verdict on her husband. The government decided to try again. At the retrial, the prosecutors elicited false testimony from Romasanta about the number of apartments Dumitru Curescu had added during his first renovation project in 2006, thereby making a tape-recorded comment by Curescu about the fees he had paid her sound like a comment about a bribe payment. The prosecutors then falsely argued to the jury that this comment was proof that Curescu knew that his expediter bribed officials. Curescu was convicted on two of five counts and sentenced to six months in prison.

On March 21, Curescu’s appeal was denied. In a groundbreaking opinion authored by Judge Richard Posner, the U.S. Court of Appeals ruled that federal prosecutors may present false testimony to prove their case “hoping the error would not be caught” as long as they can establish on appeal that the “error [did not] reduce the defendant’s likelihood of being acquitted.” “Judges are not to use reversal to punish governmental misconduct,” Posner declared.

New York Times columnist James B. Stewart has written extensively about corporate executives at companies such as Wal-Mart and Tyson Foods, which regularly pay bribes to avoid troublesome regulations. In his recent column about the Wal-Mart scandal, Stewart reports that he “couldn’t find a case of an executive at a major American-based, publicly traded company who was successfully prosecuted and sent to jail.”

Yet the feds spared no expense or ethical restraints to make sure that Curescu went to jail, despite the testimony of his architect that the former janitor had “no knowledge” about the permitting process.

On April 2, after two lengthy and expensive federal trials and an unsuccessful appeal, Curescu entered a federal prison in Oxford, Wis. Three weeks later his bank sent notice that it is foreclosing on the Curescus’ home where Lavinia lives with their three children. Meanwhile, in a recent SEC filing, Wal-Mart predicted its bribery scandal will not have a “material adverse effect on [its] business … or cash flows.”

Leonard Goodman is a Chicago criminal defense lawyer and Adjunct Professor of Law at DePaul University.

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