Business Crimes Hotline

Epson, known as Sanyo Epson Imaging Devices Corporation at the time, allegedly participated in a conspiracy with certain Japanese co-conspirators to fix prices of the TFT-LCD screens that it sold to Motorola for use in mobile phones. Epson then allegedly exchanged information on sales and issued price quotations in line with the agreed upon pricing in an effort to monitor the agreement.

The government filed a one-count felony charge against Epson in U.S. District Court in San Francisco. As part of its plea agreement, Epson will pay a $26 million criminal penalty and has agreed to cooperate with the continuing investigation.

Epson's plea is part of a broad investigation by the DOJ and the FBI into this market. In December 2008, Sharp Corporation and LG Display Company pleaded guilty to conspiracies to fix prices. LG was sentenced to pay a $400 million fine while Sharp was sentenced to pay a $120 million fine.

In January 2009, Chunghwa Picture Tubes Ltd. pleaded guilty for its role in a conspiracy and was sentenced to pay a $65 million fine. In May 2009, Hitachi Displays Ltd. pleaded guilty to a price-fixing conspiracy and was sentenced to pay a $31 million fine. The government has also charged nine executives.

Pacific Consolidated Executive Pleads Guilty to Bribery

Leo Winston Smith, former director of sales and marketing for Pacific Consolidated Industries LP (“Pacific”), pleaded guilty to a conspiracy to bribe a UK Ministry of Defense official and obstruction of the administration of the internal revenue laws.

The government alleged that Smith participated in a conspiracy to obtain contracts with the UK Royal Air Force in exchange for the bribes. Pacific manufactures equipment, such as air separate units and nitrogen concentration trolleys, that it sold primarily to government defense departments. The government claimed that Smith, in conjunction with Pacific's president, paid more than $70,000 in bribes through a false marketing agreement between Pacific and one of the UK official's relatives. In return for these payments, Pacific obtained contracts from the Ministry of Defense.

The matter was originally referred to the DOJ after Pacific was acquired by investors, who disclosed their findings and cooperated in the government's investigation. Previously, Martin Eric Self, the former president of Pacific, pleaded guilty to two counts of violating the Foreign Corrupt Practices Act (“FCPA”) and was sentenced to two years of probation. In addition, the UK official implicated pleaded guilty to accepting more than $300,000 in bribes and will serve two years in prison in the UK. Smith will be sentenced on Dec. 18, 2009 and faces a maximum of eight years in prison.

NEW YORK

Chairman and CEO of Mayfair Capital Group Charged with Fraud

The FBI arrested Stephen R. Green, Chairman and CEO of Mayfair Capital Group, LLC (“Mayfair”), on charges of securities fraud and wire fraud.

The government claims that Green obtained institutional investments through false representations that defrauded one client of $2.75 million. Specifically, the government alleges that Green initially convinced an institutional investor to provide Mayfair with $1 million for investment in a new group he claimed would be investing in restaurant franchises. Green allegedly later obtained an additional $1 million by falsely claiming that another entity had invested $18 million in the venture and assuring the original investor that an additional $1 million was the only way to avoid dilution. Green also convinced the same institution to invest $750,000 in a venture that would be investing in Copal Partners L.P. Green falsely claimed that he had invested $250,000 and Mayfair had invested $1 million. Green, however, never made any investment in Copal Partners and never obtained any shares in that business.

The government has charged Green with two counts of securities fraud and two counts of wire fraud.

CALIFORNIA

Epson Imaging Devices Pleads Guilty to Price Fixing

Epson Imaging Devices Corporation (“Epson”) recently pleaded guilty to participating in a conspiracy to fix the prices of Thin Film Transistor-Liquid Crystal Display (“TFT-LCD”) panels.

Epson, known as Sanyo Epson Imaging Devices Corporation at the time, allegedly participated in a conspiracy with certain Japanese co-conspirators to fix prices of the TFT-LCD screens that it sold to Motorola for use in mobile phones. Epson then allegedly exchanged information on sales and issued price quotations in line with the agreed upon pricing in an effort to monitor the agreement.

The government filed a one-count felony charge against Epson in U.S. District Court in San Francisco. As part of its plea agreement, Epson will pay a $26 million criminal penalty and has agreed to cooperate with the continuing investigation.

Epson's plea is part of a broad investigation by the DOJ and the FBI into this market. In December 2008, Sharp Corporation and LG Display Company pleaded guilty to conspiracies to fix prices. LG was sentenced to pay a $400 million fine while Sharp was sentenced to pay a $120 million fine.

In January 2009, Chunghwa Picture Tubes Ltd. pleaded guilty for its role in a conspiracy and was sentenced to pay a $65 million fine. In May 2009, Hitachi Displays Ltd. pleaded guilty to a price-fixing conspiracy and was sentenced to pay a $31 million fine. The government has also charged nine executives.

Pacific Consolidated Executive Pleads Guilty to Bribery

Leo Winston Smith, former director of sales and marketing for Pacific Consolidated Industries LP (“Pacific”), pleaded guilty to a conspiracy to bribe a UK Ministry of Defense official and obstruction of the administration of the internal revenue laws.

The government alleged that Smith participated in a conspiracy to obtain contracts with the UK Royal Air Force in exchange for the bribes. Pacific manufactures equipment, such as air separate units and nitrogen concentration trolleys, that it sold primarily to government defense departments. The government claimed that Smith, in conjunction with Pacific's president, paid more than $70,000 in bribes through a false marketing agreement between Pacific and one of the UK official's relatives. In return for these payments, Pacific obtained contracts from the Ministry of Defense.

The matter was originally referred to the DOJ after Pacific was acquired by investors, who disclosed their findings and cooperated in the government's investigation. Previously, Martin Eric Self, the former president of Pacific, pleaded guilty to two counts of violating the Foreign Corrupt Practices Act (“FCPA”) and was sentenced to two years of probation. In addition, the UK official implicated pleaded guilty to accepting more than $300,000 in bribes and will serve two years in prison in the UK. Smith will be sentenced on Dec. 18, 2009 and faces a maximum of eight years in prison.

NEW YORK

Chairman and CEO of Mayfair Capital Group Charged with Fraud

The FBI arrested Stephen R. Green, Chairman and CEO of Mayfair Capital Group, LLC (“Mayfair”), on charges of securities fraud and wire fraud.

The government claims that Green obtained institutional investments through false representations that defrauded one client of $2.75 million. Specifically, the government alleges that Green initially convinced an institutional investor to provide Mayfair with $1 million for investment in a new group he claimed would be investing in restaurant franchises. Green allegedly later obtained an additional $1 million by falsely claiming that another entity had invested $18 million in the venture and assuring the original investor that an additional $1 million was the only way to avoid dilution. Green also convinced the same institution to invest $750,000 in a venture that would be investing in Copal Partners L.P. Green falsely claimed that he had invested $250,000 and Mayfair had invested $1 million. Green, however, never made any investment in Copal Partners and never obtained any shares in that business.

The government has charged Green with two counts of securities fraud and two counts of wire fraud.