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Photo Credit: Momentum 

In May of 2017, TRACE launched the podcast “Bribe, Swindle or Steal”, hosted by TRACE President Alexandra Wrage. The podcast features interviews with professionals and luminaries in the field of financial crime including bribery, fraud, money-laundering, insider-training and sanctions. Tailored towards compliance professionals, “Bribe, Swindle or Steal” seeks to educate and entertain listeners on issues relating to corruption and compliance.

The episode “After You Pay a Bribe…” details former Unaoil executive Lindsey Mitchell’s account of being at the center of a bribery scandal involving the Monaco-based oil company. Unaoil wanted Mitchell, who had been working for the company since 2009, to win favor with Gaddafi regime officials so that their multinational clients could gain access to Libya’s oil. One evening in August 2009, Mitchell was called to a late-night meeting with a National Oil Company (NOC) official, who claimed that they could help Unaoil’s clients succeed in Libya in exchange for a bribe, which was between $10,000-$20,000. Mitchell reported this incident to his bosses, the Ahsanis, however to his shock they said that he should pay whatever they asked for. Disgusted with what he did, Mitchell resigned immediately after the incident and has since cooperated with investigators. Whether he will ultimately be indicted for a crime or called to testify against his former employer remains unknown.

One particularly interesting aspect of the conversation was Lindsey Mitchell’s long career in the oil industry, working in high risk environments such as Kazakhstan, Saudi Arabia, and Iraq, and how Libya was the first time he became acutely aware of bribery. Indeed, in Tripoli, paying the bribe in-person, late at night in the recipient’s home, spooked him. Spooked him enough to resign from Unaoil, leave Tripoli the next day and head straight back to Canada. Yet, despite this lapse in judgement, when pressed about how to protect your company from getting ensnarled in wrongdoing in risky environments, Mitchell suggests you have to hire the right guy. This being a gregarious go-getter who will network, learn the ropes and make the right connections with the NOC folks, oil-industry expats and government officials generally. Selecting the wrong person for the job, risks losing out on contracts, or worse, corrupt and illicit behavior.

Wrage makes the important point that many companies thought they were doing just that, hiring the right guy, when they hired Unaoil. Mitchell, incredulous, states that because Unaoil didn’t have a registered entity on the ground nor any fixed assets, the international oil companies (IOC) hiring them were negligent in their due diligence. While not trusting a company like Unaoil may seem obvious now, after the email dump and impressive reporting efforts by the Age, the ongoing investigations by the United Kingdom’s Serious Fraud Office and the United States’ Department of Justice – it likely looked different back then. Namely, Unaoil had Lindsey Mitchell at the head of its Business Development; a man with several decades in the oil industry, known to be a straight shooter, unwilling to bribe, and capable of getting the job done through legitimate processes. Mitchell most likely was the reputational signal to IOCs looking for trustworthy partners.

It was not only Mitchell, in the podcast he refers to his small group of colleagues in Monaco at the time – all with impressive backgrounds at multi-national companies with relatively good reputations. None of them, including Mitchell ever Whistleblew in regards to corrupt behavior sanctioned by their employer. Moreover, it wasn’t until it became clear that he could go to jail did Mitchell so much as demonstrate consternation over his previous employer’s illicit activity, indeed, he resigned for “family reasons.”

This podcast is an important reminder that firm and individual reputation matter – especially when the best compliance system in the world cannot predict that the ethical expat will end up paying a bribe late one night in Tripoli.

Louisa Tomar is a Program Officer for Global Programs at the Center for International Private Enterprise (CIPE)