On August 15, 2013, Nazir Karigar was found guilty of offering or agreeing to bribe foreign officials, in contravention of the Corruption of Foreign Public Officials Act (CFPOA). A hearing date to determine Mr. Karigar's sentence has not yet been set. Under the CFPOA, Mr. Karigar could be subject to imprisonment of up to five years. As discussed in this bulletin, the judgement provides important interpretive guidance to the interpretation of the jurisdictional and conspiracy elements of crimes under the CFPOA that will affect future CFPOA prosecutions.
Facts Giving Rise to the Conviction
Mr. Karigar was hired by Cryptometrics Canada, a subsidiary of Cryptometrics US, based in New York, to offer strategic advice to the company on winning a bid issued by Air India to provide the airline with a facial recognition security system. In an attempt to secure this contract, Cryptometrics, USA transferred $450,000 from its US account to the account of Mr. Karigar who, in turn, offered this amount in bribes to the Indian Minister of Civil Aviation and officials of Air India, which is owned and controlled by the Government of India. While there is no evidence of any Indian official accepting this bribe, the money is no longer in Mr. Karigar's account. He apparently later told a member of the Consulate General for Canada in Mumbai that the Minister of Civil Aviation had accepted and received the bribe.
The CFPOA makes it a criminal offence if one "agrees to give or offer...an advantage or benefit of any kind." The Crown alleged that Mr. Karigar conspired to bribe Indian government officials. The defence challenged the Crown on two grounds: (i) The law requires a bribe to actually have been made; (ii) Canada lacked jurisdiction to prosecute Mr. Karigar.
Conspiracy to Bribe under the Corruption of Foreign Public Officials Act
Mr. Karigar argued that there was no evidence that the bribes were actually paid. The defence argued that the CFPOA, uses the word "agrees," which implies there must be an "agreement of two people – one to pay a bribe and one to receive said bribe." The defence argued that because the Crown could not prove the bribe was actually received, the Crown had not proven the elements of conspiracy to bribe beyond a reasonable doubt.
The court agreed that there was no evidence of what happened to the payments intended for bribery after the sums were removed from Mr. Karigar's account. However, this is not necessary to have conspiracy to bribe under the CFPOA. The court interpreted "agrees" as a reference to conspiracy, rather than an agreement between the person offering and the person accepting the bribe. The court cited the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions (Convention) for interpretive guidance because the CFPOA was enacted to bring its provisions into force. The Convention compels countries to prosecute conspiracy to bribe foreign public officials. Because the CFPOA was enacted to enforce the Convention, the court concluded that "agrees" must be interpreted to include conspiracy to bribe as a prosecutable offence.
Justice Hackland found that the CFPOA was not drafted to require the Crown to prove the foreign official accepted the bribe because this would require evidence from foreign jurisdictions and would render the CFPOA virtually unenforceable. It is sufficient to establish only that the accused believed that a bribe was paid to an official.
The court rejected the defence argument that conspiracy only became an offence once the CFPOA was amended by the recently enacted Fighting Foreign Corruption Act because the amending law expressly states that charges can be brought against one who engages in a "conspiracy to commit, an attempt to commit, ... an offence under this Act." The defence argued that because these amendments were made only after the events took place, Mr. Karigar cannot be charged for conspiracy. Justice Hackland interpreted the amendment to mean that it gives the RCMP exclusive authority to lay charges under the CFPOA, and did not expand the grounds for laying charges.
Challenge to Jurisdiction Failed
The CFPOA provisions applicable at the time of the offence required the Crown to prove a "real and substantial link" between the offence and Canada, in accordance with the Supreme Court test set out in Libman v The Queen (Libman). This is often referred to as 'territorial jurisdiction.' The first part of the test considers the relevant facts that may give rise to Canadian jurisdiction over the case. The second part of the test considers whether, in asserting jurisdiction, members of the international community would be offended by Canadian assertion of jurisdiction, referred to as international comity.
The defence argued that there was no real and substantial link because the co-conspirators and those controlling the operations were based in New York, and the bribes occurred in India. The court rejected this argument, stating that there is a real and substantial link, which is established if a significant portion of the activities of the offence took place in Canada. Mr. Karigar was a Canadian businessman hired by a Canadian company; the bribe was for the benefit of a Canadian company or a Canadian component of an international company, and had the bribe been successful, a substantial amount of the work would have been done by employees in Ottawa. Justice Hackland also noted that nearly all the documentary evidence and the witnesses who testified were located in Canada.
Justice Hackland also determined that by asserting jurisdiction over this matter, Canada would not offend international comity. Since the allegations involved a Canadian company, if Canada failed to prosecute under the CFPOA, it would be violating its international obligations in the Convention.
This case provides valuable and much needed guidance on the scope of the bribery provisions of the CFPOA and in particular in relation to the required elements of conspiracy to commit a bribe. This case also sets important precedent with regard to Canada's jurisdiction to prosecute alleged offences. Although the CFPOA has been amended to expand the scope of prosecution to Canadians even when there is no real and substantial link between the alleged offender and Canada, the real and substantial link test for claiming jurisdiction still applies under the CFPOA. This decision provides clarification on the application of the test under this law.
As of the date of this bulletin, the defence has not indicated whether it will appeal. No sentencing date has yet been set, but the expectation is that the court will consider this in September.
Read the Court's decision: R. v. Karigar, 2013 ONSC 5199