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18 months in federal prison for FSM official

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Bribery case against FSM official details cash, cars, trips

FSM: The Federated States of Micronesia Division of Civil Aviation, a branch of the Department of Transportation, Communication and Infrastructure, features an FSM airport on its website. A former FSM airport official, Master Halbert, has been convicted in the federal court for allegedly receiving and demanding bribes. Photo courtesy of the FSM government

A former transportation official of the Federated States of Micronesia government will go to federal prison for 18 months after he pleaded guilty to one count of conspiracy to commit money laundering.

Master Halbert, 44, was sentenced Tuesday in Honolulu by U.S. District Judge Susan O. Mollway of the District of Hawaii, the U.S. Justice Department stated.

Halbert was a manager in the FSM’s Department of Transportation, Communications and Infrastructure. He administered the FSM’s aviation programs, including the management of its airports. 

Halbert admitted that between 2006 and 2016, a Hawaii-based engineering and consulting company owned by Frank James Lyon paid bribes to FSM officials, including Halbert, to obtain and retain contracts with the FSM government valued at nearly $8 million, in violation of the Foreign Corrupt Practices Act, the Justice Department stated. Lyon and Halbert agreed that these bribe payments would be transported from the United States to the FSM, according to the Justice Department.

Lyon's company obtained contracts with the FSM government including for an airport improvement project funded in large part by the U.S. Federal Aviation Administration, the indictment against Halbert states.

Lyon, 53, of Honolulu, entered a guilty plea on Jan. 22 to one count of conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act. He was sentenced to two years and six months in prison on May 13.

Halbert sought cash, a truck and money for shopping and trips from Lyon or his engineering business, court documents state.

The case, investigated by the FBI, documents years of email exchanges in which Halbert sought bribes and favors from the contractor.  The Justice Department's Criminal Division’s Office of International Affairs and the U.S. Department of Transportation’s Office of Inspector General provided significant assistance in the case, the Justice Department stated.

As an example, on Aug. 27, 2015, Halbert sent an email to Lyon with the subject line, "2014 Chevy Silverado." The email stated, "Please get this truck. It is my cash so when I need to pay back anyone, I can sell it or this will be my ride forever. If you can, lift it 6 (inches) and put on black rims."

Fake engineering degree

In December 2015, Halbert entered into a deferred prosecution agreement with the FSM for falsifying his engineering credentials, which allowed him to receive a higher salary from the FSM government based on claim he had a four-year engineering degree from a U.S. university when he didn't, the agreement states. The agreement required Halbert to pay restitution to the FSM government.

Looking for cash for his restitution in the FSM case, Halbert sent an email on Oct. 10, 2015 asking Lyon to "still help me with $40K."

On June 2, 2011, Halbert sent an email, to "co-conspirator 1" seeking help on a trip to Honolulu, stating, "I am sorry to do this but I really your [sic] help again. We came with $3,000 and we have already used half of that in food and shopping. Can you and Jim [Lyon] give me $1,500 and this should last us for the rest of the trip."

On Nov. 15, 2015, Halbert sent an email requesting that the engineering company book and pay for a hotel room for Halbert and members of his family for a trip to Guam. The engineering company executive responded that "at this time" the engineering company was approving "only project reimbursable travel requests."

As previously reported by The Guam Daily Post, the court record revealed email exchanges between Halbert and Lyon discussing the bribes:

• On May 3, 2010, Halbert sent an email to Lyon and "co-conspirator 1" regarding an FSM auditor's concerns about the purchase of a vehicle. Halbert wrote, "I know I should protect myself and [not] put this in writing or discuss this in e-mail or any form of communication that can provide as a concrete evident [sic] and come back and used against me but it's ok, if you want to take me down no problem." Halbert wrote and threatened that if Lyon and co-conspirator 1 were not willing to back him up in confronting the auditor, then Halbert did "not think [they] should do business together again."

• On June 2, 2011, Halbert sent an email to co-conspirator 1, seeking help on a trip to Honolulu, stating, "I am sorry to do this but I really your [sic] help again. We came with $3,000 and we have already used half of that in food and shopping. Can you and Jim [Lyon] give me $1,500.00 and this should last us for the rest of the trip."

• On Dec. 1, 2011, Halbert emailed co-conspirator 1, "Can you ask Jim for some money? I need $1,000 and if ok, you can give it to me when we get to Hawaii."

• On May 7, 2014, Halbert sent an email to co-conspirator 1, with the subject line, "Per dium," [sic] stating, "Please bring my money at home. Can you ask Jim if you can add another $1,000." 

• In or around June 2015, Halbert and Lyon instructed co-conspirator 1 to draft a request for qualification document seeking bids for an FSM project management contract.

• In July 2015, the engineering company was awarded the contract by the FSM government.

• On Aug. 27, 2015, Halbert sent an email to Lyon with the subject line, "2014 Chevy Silverado," stating, "Please get this truck. It is my cash so when I need to pay back anyone, I can sell it or this will be my ride forever. If you can, lift it 6 in and put on black rims."

• In connection with his plea, Lyon admitted that in 2015, he and his co-conspirators purchased an additional vehicle for Halbert's personal use.

• On Sept. 1, 2015, Halbert sent an email to co-conspirator 1, asking co-conspirator I to talk to Lyon about loaning Halbert $2,500 to open an account.

• On Nov. 15, 2015, Halbert sent an email requesting that the engineering company book and pay for a hotel room for Halbert and members of his family for a trip to Guam. The engineering company executive responded that "at this time" the engineering company was approving "only project reimbursable travel requests."

• On or about Nov. 16, 2015, Halbert emailed three of the engineering company's employees, "This is to inform you that I am closing your office starting tomorrow until further notice."

• On Nov. 17, 2015, Halbert sent an email to the engineering company executive, stating, in part, "You don't understand and appreciate how Lyon got this job ... You're very disrespectful and insulting. For this, Lyon will never get another job in the FSM. I can make that happen."

• In December 2015, Halbert entered into a Deferred Prosecution Agreement with the FSM for falsifying his educational credentials, which allowed him to receive a higher salary from the FSM government. The DPA required Halbert to pay restitution to the FSM government.

• Leading up to the deferred prosecution, on Oct. 10, 2015, Halbert sent an email to Lyon asking Lyon to "still help me with $40K."

• On Dec. 22, 2015, co-conspirator 1 sent a response email informing Halbert the company officials stated: "They don't have money now. They are short of money all the time."

• On Dec. 22, 2015, Halbert sent a response email to co-conspirator 1, stating, "I'm shocked ... really thought they committed to help."

• On Dec. 22, 2015, co-conspirator 1 sent an email to Halbert, stating, "They will help you by monthly."

• On March 21, 2016, Halbert sent an email to Lyon, "You don't think people in the government questions why I have a long term contract with Lyon? You don't understand how hard I work from my side to protect you and your contract."

• On or about April 19, 2016, Halbert sent an email to Lyon, stating, in part: "Can you put me on your payroll so I have some money every month? Let me know your thought."