A&O Shearman FCPA Digest | United States v. Steven Lynwood Head (S.D. Cal. 2006)

Source Documents

Nature of Business
Development and operation of a wireless telephone system in Benin. In 1999, the Titan Corporation (“Titan”), a U.S. defense contractor (later acquired by L-3 Communications in July 2005), acquired the rights to develop and operate this network. Steven Lynwood Head was employed by Titan as program manager of business activities in Benin, and later as CEO of Titan Africa, Inc. Although separately incorporated, Titan Africa, Inc. shared employees, officers, and personnel with Titan.

Influence to be Obtained
As part of its contract to develop and operate the wireless telephone system, Titan was required to pay part of its profits as subsidies to the Benin government for development of certain economic sectors (“social payments”). In or about December 2000, the business advisor solicited money from Titan under the guise of “advanced social payments.” Although Head believed that at least part of the payments would be used to support the Benin President’s reelection effort, he nonetheless caused the requested payments to be made through a false invoice for consulting services allegedly performed. Head also used the scheduling and payment of the monies as leverage to increase Titan’s management fee under the contract.

Enforcement
Steven Lynwood Head pleaded guilty to a one-count information charging falsification of the books, records and accounts of an issuer under the federal securities laws. Pursuant to the plea agreement, Head will cooperate with the government’s ongoing investigation of individuals formerly associated with Titan. In September 2007, Head was sentenced to 6 months imprisonment, supervised release for a term of 3 years, and a $5,000 fine.