ABOVE: Richard Bistrong

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Well, it now seems that some export issues may be arising in the much-publicized “Shot Show” Foreign Corrupt Practices Act (“FCPA”) prosecution. In that case, law enforcement officials perp-marched owners and officials of gun and law enforcement supply businesses from the Las Vegas Shot Show and then charged them with violating the FCPA.

This is the first and only FCPA prosecution that has arisen from a sting operation. The prosecution alleges that the defendants had agreed to make kickbacks to African officials in connection with the potential award by those officials of a $15 million contract. The transactions were fictional and cooked up by investigators. The African officials were imposters played by FBI agents with thespian inclinations.

The chief cooperating witness, who undertook a major role in setting up the sting, is Richard Bistrong, a former official of a body armor company who is himself now charged with paying actual bribes to actual officials in actual transactions. Specifically, Bistrong is the subject of a criminal information filed in a federal district court charging Bistrong with bribing UN officials to rig bids which resulted in awards of large body armor contracts to his company. In the Shot Show prosecutions, Mr. Bistrong pretended to be the broker in the phony African transactions and introduced the defendants to the FBI undercover agents who were playing various roles in the sting.

The defendants have argued that they were entrapped by the FBI through Bistrong’s inducement and that they had no predisposition to commit the crimes charged. In effect, Bistrong dangled $15 million contracts in front of the defendants, many or some of whom were store-front businesses and had never had such large contracts offered to them before. Key to the defense in this case is to discredit Bistrong above and beyond the issues raised by his own FCPA prosecution. According to this recent post at the blawg Main Justice, the defendants have asked for copies of Mr. Bistrong’s tax returns, alleging that they will reveal tax violations by Bistrong. The judge hearing the trial has indicated that if the government doesn’t turn over the tax returns voluntarily, then he will grant an order forcing them to do so.

The defense has also asked for “any export licenses [Bistrong] had been given by the federal government.” (And you thought I would never get to the export angle, didn’t you?). This request did not just come out of the blue. The criminal information filed against Bistrong alleges export violations in addition to the FCPA violations. Specifically it alleges that Bistrong shipped vests and helmets with level IIIa ballistic protection to the Kurdistan Regional Government in Iraq without the required licenses from the Department of Commerce’s Bureau of Industry and Security (“BIS”). It looks like the defendants here are gathering impeaching evidence to support the government’s charges against Bistrong, evidence which the government certainly won’t introduce on its own in the Shot Show FCPA prosecution.

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