November 24, 2019

Hedge fund executive sentenced to prison following bribery investigation

On  November 19, 2019, Michael Leslie Cohen was sentenced to three months in prison and a $250,000 fine.  

The US Department of Justice originally indicted Cohen, who served as head of the European office of Och-Ziff Capital Management Group, LLC in October 2017.  According to the indictment, Cohen and his co-conspirators defrauded an Och-Ziff client who invested in an Och-Ziff joint venture in Africa, by failing to disclose to the client that (i) Cohen had a personal interest in this joint venture and (ii) one of the sellers of shares in the joint venture owed Cohen millions of dollars on a delinquent personal loan, and was planning to use the Och-Ziff client’s investment to repay Cohen.  The indictment further alleged that Cohen obstructed an investigation by the US Securities & Exchange Commission  by creating a fake letter to hide the fact that the individual who owed Cohen money repaid him immediately after the Och-Ziff client purchased stock in the joint venture, and that Cohen then made materially false statements to the SEC about the letter.  He pleaded guilty, in May 2019, to making these false statements.

Och-Ziff separately resolved US Foreign Corrupt Practices Act investigations by the DOJ and SEC in September 2016, paying over $412 million for its role in the bribery of foreign officials in Libya, Chad, Niger, and the Democratic Republic of the Congo.  Och-Ziff’s former CEO and CFO also paid approximately $2.2 million to resolve related charges.