The CFPOA came into force in 1999 as Canada's means of
ratifying the OECD's Convention on Combating Bribery of
Foreign Public Officials in International Business
Transactions. Soon after the Act was enacted, the
Canadian government was criticized by both the OECD and
Transparency International for its failure to take action against
Canadians alleged to have bribed officials abroad.
Karigar was convicted of offering bribes to Air India officials
and India's then Minister of Civil Aviation in order to secure
a major contract from Air India for the provision of facial
recognition software and related equipment contrary to s. 3(1)(b)
of the CFPOA. At the time of the offence, Karigar acted as a
consultant to Cryptometrics Canada, which is based out of
Ottawa. Karigar approached Cryptometrics with a plan to obtain
a contract with Air India by bribing Indian public officials to get
the deal done. Karigar and his business partner were to receive
thirty percent of the revenue stream from any resulting Air India
The bribes were never paid, but not from any lack of effort on
Karigar's part. According to the trial decision, Karigar
travelled regularly to India to meet with the key public officials
and was able to obtain "inside information" about
proposed tender terms and competitors. He kept Cryptometrics
informed about which Air India officials would be paid bribes, the
amounts to be paid, and shares in Cryptometrics to be doled
out. This incriminating evidence all ended up in spread
sheets, and Karigar admitted in statements to the RCMP that he was
the one that furnished this incriminating evidence.
On two separate occasions, Cryptometrics transferred to Karigar
a total of $450,000 for the payment of bribes, and the plan
appeared to bear fruit. Cryptometrics and another company
controlled by Karigar were the only two companies short-listed as
qualified bidders. Everything appeared to be falling into
place as draft contracts together with updated bribe spreadsheets
were circulated, but the project faced delays and the plans
ultimately came crashing down.
Karigar and Cryptometrics had a falling out. Cryptometrics
sought a return of the monies it had given to Karigar.
Karigar acted quickly by reporting the bribes, under a variety of
pseudonyms, to both Canadian and American authorities, and a
criminal investigation was commenced.
In the trial decision, Justice Hackland held that a conspiracy
to bribe foreign public officials is a violation of the Act, and
the mental element of the offence is the agreement to pursue an
unlawful object – in this case the plan to bribe public
officials. Karigar was found guilty for the intention to bribe:
there was no need for the bribe to have actually been paid.
Under the CFPOA as it read at the time of Karigar's illegal
actions, the maximum sentence that could be imposed for a breach of
the Act was five years imprisonment. Amendments to the Act
have since increased this amount to 14 years, reflecting a trend in
Canada's increased prosecution of white collar crime.
In sentencing 67-year old Karigar to three years in jail,
Justice Hackland emphasized the deterrence aspect of his decision,
and, in particular, the negative effects of bribery on the rule of
law in developing countries.
This decision is an example of how the Canadian government is
taking steps to give the CFPOA more teeth. In addition to
this recent conviction, the RCMP is in the process of conducting at
least 34 other investigations. Amendments to the Act made in
June of 2013 have also made it easier to obtain convictions and
impose more serious consequences for breaches of the Act.
While Karigar was the first, he will not be the last to be tried
and convicted under the CFPOA.
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