A superseding indictment unsealed today in the U.S. District Court for the Southern District of Florida charges global voting machine company SGO Corporation Limited, also known as “Smartmatic,” and four individuals—including the company’s co-founder and a former Chairman of the Philippines’ Commission on Elections (COMELEC)—with conspiracy, Foreign Corrupt Practices Act (FCPA) violations, and money laundering in connection with a multi-million dollar international bribery scheme.
The indictment alleges that the defendants conspired to pay bribes to Juan Andres Donato Bautista, who served as COMELEC Chairman from 2015 to 2017, to secure lucrative contracts for the 2016 Philippine elections and ensure “favorable” payments.
The Alleged Scheme
The alleged conspiracy, spanning from May 2015 through at least February 2018, centers on securing and facilitating payments for three major election contracts—totaling approximately $182.35 million—awarded to Smartmatic subsidiaries for the 2016 Philippine national elections.
According to the superseding indictment, Smartmatic executives Roger Alejandro Pinate Martinez, a co-founder and executive; Jorge Miguel Vasquez, an executive; and Elie Moreno, a project director, are accused of creating and using “slush funds” to pay bribes to Bautista.
This involved inflating the cost per voting machine by an additional $50 and $10 per unit, which they referred to in coded language such as the “boss’s funds,” “RUSH fee,” “Extra Fee[s],” and “RUE” to conceal the funds’ true purpose.
Concealment and Money Laundering
To execute the bribery, the defendants allegedly created fraudulent contracts and sham loan agreements between offshore shell companies controlled by co-conspirators and a foreign shell company, Baumann Enterprises Limited, which was owned and controlled by Bautista.
A key focus of the money laundering charges is an attempt to transfer approximately $1 million in bribe payments through a series of transactions. The indictment details three attempted wire transfers—each for approximately $500,000—from Hong Kong bank accounts associated with the shell companies, traveling through an intermediary bank in New York, and destined for Baumann’s bank account in Singapore.
In a move to allegedly conceal the proceeds, Bautista is accused of wiring $960,000 from his Singapore account to a family member’s bank account in New York, who then used the money to purchase a property in San Francisco, California. This real estate is now cited as a forfeitable asset in the court documents.
Defendants and Charges
The defendants named in the superseding indictment are:
- Juan Andres Donato Bautista: Former Chairman of COMELEC, charged with Conspiracy to Commit Money Laundering and International Laundering of Monetary Instruments.
- Roger Alejandro Pinate Martinez: Co-founder and executive of Smartmatic, charged with Conspiracy to Violate the FCPA, Violation of the FCPA, Conspiracy to Commit Money Laundering, and International Laundering of Monetary Instruments.
- Jorge Miguel Vasquez: Executive at Smartmatic, charged with Conspiracy to Violate the FCPA, Violation of the FCPA, Conspiracy to Commit Money Laundering, and International Laundering of Monetary Instruments.
- Elie Moreno: Project Director at Smartmatic, charged with Conspiracy to Commit Money Laundering and International Laundering of Monetary Instruments.
- SGO Corporation Limited (Smartmatic): Charged with Conspiracy to Violate the FCPA and Conspiracy to Commit Money Laundering.
The indictment includes charges for Conspiracy to Violate the Foreign Corrupt Practices Act and Conspiracy to Commit Money Laundering, with the latter carrying a maximum term of imprisonment of 20 years for the individuals.
The case is being handled by the U.S. Attorney’s Office for the Southern District of Florida and the Department of Justice’s Fraud Section.
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