Lyon faced with US charges of bribery related violations of Foreign Corrupt Services Act

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Published: Tuesday, 19 March 2019 04:17

Written by Bill Jaynes

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Unnamed FSM officials implicated in charges

By Bill Jaynes

The Kaselehlie Press

January 18, 2019

Hawaii—Yesterday, US prosecutors filed a criminal information in the US District Court in Hawaii on charges they allege against Frank James (Jim) Lyon.  The US has accused Lyon of bribing officials in Hawaii, allegedly to gain a $2.5 million dollar contract.  They have also accused him of bribing officials in the FSM, allegedly in order to get a $7.8 million contract with the FSM government “funded in large part by the United States Federal Aviation Administration…and for project management.”

The US criminal charges allege that between the years 2006 through 2016, Lyon “together with his co-conspirators, provided bribe payments to FSM officials totaling at least approximately $200,000 in order to obtain approximately $7.8 million in contract payments.”

The US charge also alleges that between 2011 and 2016, Lyon and his alleged co-conspirators provided bribe payments in cash for distribution to Hawaii officials totaling at least approximately $240,000 in order to obtain a $2.5 million contract.

The allegations have not been proven. Lyon is presumed to be innocent unless he is proved to be otherwise in a court of law.

He will have to defend himself against charges that he violated the Foreign Corrupt Practices Act which says that it is “unlawful to act corruptly in furtherance of an offer, promise, authorization, or payment of money or anything of value, directly or indirectly, to a foreign official for the purpose of assisting in obtaining or retaining business for, or directing business to, any person.”

Though the charges do not identify them by name, people in Hawaii and in the FSM the charges label as co-conspirators 1 through 3, and Micronesian Officials 1 and 2, are colored by the allegations the US Government filed against Lyon.

The charges say that a person the prosecutors call “Micronesian Official 1” was a person “whose identity is known to the United States, was a government official in the FSM Department of Transportation, Communications and Infrastructure who administered FSM’s aviation programs, including the management of its airports.”

The charges say that “Co-Conspirator 2” was a U.S. citizen who resided in the FSM.

The person they label as “Micronesian Official 2” was “an individual whose identity is known to the United States, (and) was a government official in the FSM Congress who served on a congressional committee with oversight over ‘Engineering Company’s’ FSM contracts.”

The allegations in the criminal charge say that Lyon, “together with his co-conspirators, discussed in person, via email, and via telephone that they would pay bribes to FSM officials and State Agency officials to obtain and retain business contracts from the FSM and State Agency and to obtain payments on those contracts, including via wire transfers.”

It alleges that Lyon withdrew cash from his personal bank account that had been transferred by his company in order to pay “cash bribes to FSM officials and State Agency officials and to pay bribes in the form of vehicles, gifts, and entertainment for FSM officials.”

The criminal charges against Lyon include excerpts from emails purportedly between Lyon and “Co-Conspirator 2”, the US citizen who resided in the FSM.  It says that on or about December 28, 2010, Lyon sent an email to “Co-Conspirator 2” regarding Lyon’s Associates’ purchase of travel relating to the airport contract and an unrelated side trip to Las Vegas for “Micronesian Official 1 and his wife”.

The U.S. Criminal information said that Lyon “stated that the side trip would be expensive, but also stated, ‘This is huge (and very very very critical to get renewed) contract so I am not trying to save money—or god (sic) forbid—insult [Micronesian Official 1].’”

The charging document alleges that Lyon and his alleged co-conspirators purchased a car for Micronesian Official 1 for his or her personal use in order to retain business. “On or about July 8, 2013, Micronesian Official 1 sent an email to Frank James Lyon to go look at a Ford truck to potentially purchase for him, which (Lyon) forwarded to Co-Conspirator 1, stating “[T]his is an example of things [I] have to do[.]  [I] have to find a car, negotiate a price, figure out how to pay for it, get in on a ship to [P]ohnpei…[T]his is illegal[.] [I] can only do these things when people don’t know what I’m doing[.]”

The U.S. charges allege that “on or about January 20, 2014, [Lyon] and his co-conspirators caused a wire transfer of approximately $3902.99 to be sent from a bank account controlled by [Lyon] to the University of Hawaii to pay tuition for a relative of Micronesia Official 1.”

The charges allege that in April of that year, Lyon and his alleged co-conspirators caused a similar wire transfer amount to be transferred to the University of Hawaii to pay for tuition of a relative of Micronesian Official 1.”

The charges allege that in or around June 15, Lyon and Micronesian Official 1 instructed Co-conspirator 2 to “draft a request for qualification document seeking bids for an FSM project management contract, including drafting selection criteria to favor (Lyon’s company) in order to obtain an improper business advantage and win the PMU (FSM Project Management Unit) Contract.”

“On or about December 9, 2015, Frank James Lyon sent an email to Co-Conspirator 1 stating that ‘[Micronesian Official 1] is asking for $5K/month…So you and I will have to work together on spending & get agreement with [another Engineering Company executive] on guidelines on what goes into [marketing]’,” the charges allege.

The U.S. alleges that in 2015, Lyon and his alleged co-conspirators purchased a car for “Micronesian Official 1’s” personal use.

The U.S. criminal information says that “…on or about April 15, 2016, Frank James Lyon stated in an email that he intended to pay for an apartment for Micronesia Official 2, and that Micronesian Official 2 ‘handles the infrastructure committee—which I need to approve our $500K contract week of [M]ay 11.”

None of the “conspirators”, 1, 2, or 3, or “Micronesia Officials” 1 or 2 is identified by name in the charges the US filed against Jim Lyon.  Any speculation on their identities would only be guesswork.

Today the website for Lyon Associates was inaccessible.