The Oil and the Glory

The wheels of justice grind slow. Very slow.

Next Wednesday, James Giffen will make what Bloomberg tallies as at least his 20th court appearance in what was, at the time of his arrest, the largest foreign bribery case in American history. Giffen, you may recall, was arrested at JFK Airport in 2003 and charged with channeling some $78 million in oil company payments ...

TIMOTHY A. CLARY/AFP/Getty Images
TIMOTHY A. CLARY/AFP/Getty Images

Next Wednesday, James Giffen will make what Bloomberg tallies as at least his 20th court appearance in what was, at the time of his arrest, the largest foreign bribery case in American history. Giffen, you may recall, was arrested at JFK Airport in 2003 and charged with channeling some $78 million in oil company payments to the president of Kazakhstan and his associates and family. Seven years later, Giffen now holds another distinction: He's the defendant in the longest-running foreign bribery case in U.S. history. What's going on?

The case involves payments from oil companies that no longer exist -- Mobil, Amoco, Philips -- to a country that once was one of the hottest oil frontiers on the planet, and an exemplar of the charismatic middlemen who get between the two parties, make a deal work, and get paid for this service.

Prosecutors allege that in order to get a deal done in Kazakhstan in the late 1990s one had to go through Giffen, who fashioned himself as counselor to the president of Kazakhstan. According to the charges, he was passing on millions of dollars from the oil companies to his boss, along with gifts like a really neat speedboat.

Next Wednesday, James Giffen will make what Bloomberg tallies as at least his 20th court appearance in what was, at the time of his arrest, the largest foreign bribery case in American history. Giffen, you may recall, was arrested at JFK Airport in 2003 and charged with channeling some $78 million in oil company payments to the president of Kazakhstan and his associates and family. Seven years later, Giffen now holds another distinction: He’s the defendant in the longest-running foreign bribery case in U.S. history. What’s going on?

The case involves payments from oil companies that no longer exist — Mobil, Amoco, Philips — to a country that once was one of the hottest oil frontiers on the planet, and an exemplar of the charismatic middlemen who get between the two parties, make a deal work, and get paid for this service.

Prosecutors allege that in order to get a deal done in Kazakhstan in the late 1990s one had to go through Giffen, who fashioned himself as counselor to the president of Kazakhstan. According to the charges, he was passing on millions of dollars from the oil companies to his boss, along with gifts like a really neat speedboat.

The main issue in the delay in the case is Giffen’s defense — he says that the whole time he was arranging those payments, he was effectively an asset of the Central Intelligence Agency, which knew or should have known precisely what he was doing. But coming by the evidence to support that defense isn’t easy, and the court has ruled that Giffen’s right to a fair trial requires the federal government to cough up documents that may help his case.

The CIA still hasn’t produce all the requested documents, and Giffen’s strategy is to stretch out the time as far as possible in hopes that some or all the charges get dropped. Meanwhile, the court has spent a great deal of time in a farcical discussion about whether Giffen can examine the documents himself once they are produced, or whether they can be viewed only by his lawyer, William Schwartz. (What is the possible difference between Giffen and Schwartz looking at the documents? Does Schwartz have a security clearance?) Meanwhile, Giffen has already blown through five trial dates, and no one seems to know what is taking so long.

O&G’s readers include several Giffen experts, and out of curiosity I emailed them for their learned (and anonymous) explanations for the delay. After the jump, the top 10:

1. This is normal. It really does take seven years to find, collate and staple a few dozen multi-page documents.

2. The fix is in (I). Dick Cheney told the Department of Justice to slow down the case, and no one has figured out yet that he’s no longer vice president.

3. The fix is in (II). The court fears it will be difficult to enpanel 12 jurors in New York City who haven’t given or received money from one or more U.S. or Kazakh parties in the case.

4. They’re just incompetent (I). The Justice Department is wonderful at settling with defendants, but no longer has the bandwidth to handle a serious bribery investigation of a non-cooperating target.

5. They’re just incompetent (II). The Justice Department does have the bandwidth for serious investigations, but not if the target calls its bluff with a creative defense.

6. The Southern District prosecutors aren’t what they used to be (I). Three federal prosecutors and seven years later, who can even keep track of KO-1, KO-2, CC-1 and CC-2? Moreover, who cares? I mean, some of the current prosecutors were still in high school when the alleged crimes took place.

7. The Southern District prosecutors aren’t what they used to be (II). A Harvard law student, class of 2012, has told the Justice Department that he’d like a shot at trying the case.  

8. Siloviki complacency (I). The CIA just doesn’t feel like cooperating. And who is going to make them?

9. Siloviki complacency (II). The CIA is wholly willing to cooperate, as long as Boris Yeltsin gives his okay.

10. A common problem. George Tenet’s dog ate the CIA documents.

<p> Steve LeVine is a contributing editor at Foreign Policy, a Schwartz Fellow at the New America Foundation, and author of The Oil and the Glory. </p>

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