March 29, 2022

Former VP of Pennsylvania coal company charged with FCPA and money laundering offenses

On March 29, 2022, Charles Hunter Hobson, the former vice president of a Pennsylvania coal company, was indicted in the United States District Court for the Western District of Pennsylvania on charges of violating the US Foreign Corrupt Practices Act (FCPA) and committing money laundering and wire fraud.

As alleged in the indictment, between 2016 and 2018 Hobson served in various executive roles at an unnamed Pennsylvania coal company.  During this period, Hobson and others allegedly engaged in a bribery scheme to obtain and retain business from an Egyptian state-owned company named Al Nasr Company for Coke and Chemicals (Al Nasr).  The indictment asserts that Hobson and others paid approximately $4.8 million in commissions to a third-party sales intermediary, who — with Hobson’s knowledge — passed along a portion of these commissions to a high-level Al Nasr executive in exchange for $143 million in coal contracts.  Hobson also allegedly conspired to receive a portion of the commissions as kickbacks for his own benefit.  

In or around early 2018, Frederick Cushmore, Jr. — who on November 3, 2021 pleaded guilty for conspiring to violate the FCPA — took over responsibility at the coal company for the Al Nasr contract.  As set out in the factual basis for his plea agreement, Cushmore was responsible for the company’s business relationship with Al Nasr from around March 2018 until 2020, and ensured that the bribery scheme continued, including by traveling multiple times to Egypt to meet with the third-party sales intermediary and Al Nasr officials.  Cushmore is scheduled to be sentenced in June 2022.

DOJ press release | Indictment (Hobson) | Plea agreement (Cushmore) | Factual basis (Cushmore)