Haiti Bribery Suit Against IDT Settles

– Special Report & Commentary –

January 25, 2011 (FinancialWire) (By Lucy Komisar) (Investrend Forums Syndicate) — The lawsuit filed by a former employee against the global telecom IDT Corporation (IDT – NYSE) is over. J. Michael Jewett, a former IDT executive, claimed in 2004 that he was fired for opposing bribes to Haitian officials. Lawyers for both sides agreed to drop the complaint and counterclaims in an agreement (see PDF link, below) filed with the U.S. District Court in Newark on January 13th. This has not been reported before now.

IDT spokesman Bill Ulrey said, “We have no comment…as usual. Thank you.” Jewett’s attorney William Perniciaro also declined to discuss the matter. When both sides don’t talk about an agreement to dismiss a case, that normally means a confidential settlement has been reached.

J. Michael Jewett, who was in charge of IDT’s Caribbean business, sued the company in 2004, charging that he was fired because he would not go along with a plan to pay bribes to officials of the Aristide-era Haitian state phone company, Télécommunications d’Haiti (Teleco). The sweetheart deal reduced the fees IDT would pay Teleco to complete international calls. IDT’s payments, including kickbacks Jewett said were destined for Aristide, were channeled through a Turks and Caicos shell company instead of being deposited in a Teleco account. The offshore Turks and Caicos practices bank and corporate secrecy which makes it easy for criminals to set up fake companies to hide and move illicit cash.

Evidence that backed up Jewettâ™s claims included a contract signed by IDT and Teleco that called for payments lower than the major U.S. telecoms were paying and for fees to be sent to the shell company. Jewett was blocked by federal Judge Stanley R. Chesler from finding out who owned the shadowy firm, called Mont Salem.

After nearly seven years of delays allowed by the court, the case of Jewett v. IDT had been scheduled for trial Nov 9th, but was suddenly postponed by the judge, who claimed scheduling conflicts. He never set a new date.

Alongside Jewett’s civil case, the U.S. Justice Department and the Securities and Exchange Commission have been investigating IDT’s alleged bribery under federal anti-corruption statutes. Jean René Duperval, a Teleco official who signed the agreement that diverted IDT payments to the Turks and Caicos, has been indicted by the U.S. for taking bribes from several Miami phone companies. He is scheduled to go on trial in Miami Feb 28th and could provide information on the IDT deal as part of a plea bargain.

For more details on the IDT- Haiti Teleco story, see links to articles which I wrote over five years, posted at “The Komisar Scoop” blog (http://thekomisarscoop.com/2011/01/ex-employee-who-claimed-firing-over-opposition-to-haiti-bribery-settles-suit-against-idt/).

PDF Link (to “agreement”): http://thekomisarscoop.com/wp-content/uploads/2011/01/Court-filing-dismissing-Jewett-v-IDT.pdf


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