In April, the criminal trial of former PetroTiger CEO Joseph Sigelman for alleged violations of the FCPA will begin in federal court in Camden, New Jersey. Prosecutors allege that Sigelman bribed a Colombian official at Ecopetrol SA, a state-run energy company, to win a contract for PetroToiger.
The WSJ reports that as part of the FBI's investigation of Sigelman, the FBI persuaded PetroTiger's general counsel, Gregory Weisman, to wear a camera that allowed the FBI to record a video of a conversation between Weisman and Sigelman concerning the alleged bribe.
In this extraordinary video, a snippet of which can be viewed below, Weisman tells Sigelman that the company has "big issues” given that the FBI has recently knocked on his door and told Weisman that "they are looking into s__t in Colombia... They were asking about these payments you had me make to Johanna Navarro." Ms. Navarro was married to David Duran, the Colombian official at Ecopetrol.
In an exchange that can be seen on this video, Sigelman asks Weisman early in the conversation to “[d]o me one favor, just lift your shirt up, so I'm absolutely sure” -- presumably to check for a recording device. Weisman did so (and cleverly asked Sigelman to also lift his own shirt) but somehow Sigelman did not spot the camera, which the WSJ reports was "tiny."
Sigelman did not confess to any wrongdoing on the full video, Bloomberg reports, but did tell Weisman to “relax, because if you don't, we'll be stupid and do something stupid.” According to Bloomberg, that comment along with Sigelman's concern that Weisman was wearing a recording device helped cause the FBI to conclude that Sigelman had a "guilty mindset."
Sigelman filed a motion asking the court to suppress evidence of the video in his trial because, he said, the conversation between himself and his general counsel was protected by the attorney-client privilege. He argued that the long standing attorney-client relationship between himself and Weisman "fostered candor and trust between them–as any good attorney-client relationship should,” and that the "government took advantage of this trust.” Last month, however, U.S. District Judge Joseph Irenas denied Sigelman's motion, ruling that the conversation was not privileged because Weisman was not there to provide legal advice and Sigelman was not seeking legal advice.
Off-hand I cannot think of any other recent cases (in the securities context, at least) where a general counsel was wired by the FBI in an attempt to record incriminating evidence from someone at his or her own company. Kathleen Hamann, a partner at law firm White & Case, told the WSJ that wiring up a general counsel in this manner is “surprising” and “quite aggressive” and likely required many levels of approval at the Justice Department.