## Facts

- Terra Telecommunications Corp., a Florida company, bought and resold international phone minutes, including minutes purchased from Telecommunications D’Haiti, S.A.M. (Teleco).
- In the early 2000s, Terra accumulated significant debt to Teleco.
- Joel Esquenazi (Terra’s majority owner and CEO) and Carlos Rodriguez (minority owner and operations executive) arranged concealed payments to Teleco officials to obtain reduced bills and other business advantages.
- Payments were routed through intermediaries and recorded as “consulting services,” supported by false invoices and sham entities, and transferred to accounts controlled by Teleco officials.
- At trial, the government presented evidence that Teleco was Haiti’s national telecommunications company, created and controlled by the Haitian state, with government-appointed leadership and benefits typical of state entities.

## Issues

1. Whether Teleco qualified as an “instrumentality” of the Haitian government under the Foreign Corrupt Practices Act (FCPA), such that Teleco employees were “foreign officials.”
2. Whether the evidence was sufficient to prove Teleco’s instrumentality status and the charged bribery and related offenses.
3. Whether the district court’s jury instructions defining “instrumentality” correctly stated the law.
4. Whether the defendants’ sentences were procedurally and substantively valid, including guideline calculations tied to benefit value and role adjustments.

## Decision

- The Eleventh Circuit affirmed all convictions and sentences.
- The court held that an FCPA “instrumentality” is an entity controlled by a foreign government that performs a function the government treats as its own.
- The court concluded that sufficient evidence supported finding Teleco to be an instrumentality of Haiti and its employees to be foreign officials.
- The court upheld the jury instructions as adequate when considered as a whole and found no reversible error.
- The court rejected challenges to the sufficiency of the evidence and to sentencing determinations, finding no clear error in the district court’s factual findings or guideline applications.

## Legal Principles

- Under 15 U.S.C. § 78dd-2(h)(2)(A), “foreign official” includes officers and employees of a foreign government and its departments, agencies, or instrumentalities.
- An “instrumentality” under the FCPA means an entity (1) controlled by a foreign government and (2) performing a function the controlling government treats as its own.
- Government control may be assessed through nonexclusive factors such as ownership interest, authority to appoint and remove principals, financial support or special privileges, where profits flow, and operational control.
- Whether an entity performs a governmental function may be assessed through nonexclusive factors such as monopoly status, whether the function is traditionally governmental, whether the entity serves the public, and whether it is widely perceived as acting on the government’s behalf.
- Jury instructions on “instrumentality” are sufficient if, in context, they convey the control-and-function framework and allow the jury to evaluate the relevant factors.

## Conclusion

The Eleventh Circuit provided the first federal appellate definition of “instrumentality” under the FCPA, adopting a control-and-function test and affirming FCPA, money laundering, and related convictions arising from concealed payments to officials of Haiti’s state-controlled telecommunications company.


United States v. Esquenazi, 752 F.3d 912 (11th Cir. 2014)