Originally: Haiti Sues to Collect a Phone Bill

November 11, 2005
‘Aristide and his  accomplices demanded and received substantial bribes and
kickbacks from  U.S. telecommunications carriers, which were wire-transferred
from U.S. banks, and profited from drug  trafficking in and with the United
States.” That’s the  claim of the Haitian government and state-owned Haiti
Teleco in a civil action filed in U.S. district court in southern Florida last
week against former Haitian  president Jean Bertrand Aristide and eight other

To be clear, these are but allegations. Still, the seventy-four-page document filled
with startling detail  raises many questions not only about Aristide’s behavior
but also about American companies that are alleged to have helped him loot
the treasury  of the Western Hemisphere’s poorest  nation.

Among the American companies that the suit  alleges worked with Aristide are
New Jersey-based IDT Corp., whose CEO is former Republican Congressman Jim
Courter, and Fusion Telecom, headed by  former Democratic Party finance chairman
Marvin Rosen.

One of the “front companies”  that the claim says Aristide used is
“Foundation Aristide.” No longer active, it was a U.S. nonprofit whose board of  
directors included Aristide’s wife Mildred and his government’s lawyer Ira  Kurzban.
Board “advisers” included U.S. members of Congress Maxine Waters, Charlie
Rangel and John Conyers. The foundation board also included Joseph P. Kennedy
II — also on Fusion’s  board — and former Congressmen Ron Dellums and Michael
Barnes.  Mr. Barnes was retained by Aristide at $55,000 a month to lobby the
Clinton administration to return him to power after  his exile in a 1991
coup. Aristide was reinstalled in 1994 with the help of U.S.  troops.

The civil action demands damages for violations of the federal Racketeer-
Influenced and Corrupt Organizations Act, violations of state RICO laws in
Florida and New Jersey, breach of  fiduciary duty, fraud, deceit and conspiracy to
defraud. One might expect  the Justice Department to look into these charges,
no matter the Washington fallout that could occur.

The court document maps a money trail that, if proof exists, would explain
how Aristide enriched himself over the twelve years that he controlled — both  
officially and at times unofficially — Haiti’s purse strings. A  successful court case might also explain why the Clinton  
administration and the Congressional Black Caucus protected the strongman  for so long, despite pleas from Haitian patriots who claimed he was pillaging their country.

The complaint lists nine defendants in  total. Seven are Haitian individuals
and one is a resident of Turks and  Caicos. But the ninth defendant, a
business domiciled in Turks and Caicos, is most intriguing. The plaintiffs allege
that this firm, Mont Salem  Management Ltd., was used “to receive and distribute
kickbacks and bribes  paid to Aristide and his accomplices.” Mont Salem was
allegedly a conduit  to Aristide used by the American firms.

This is not the first time “Mont Salem”  has turned up in U.S. court
documents alleging Aristide corruption. In a 2004 wrongful dismissal case filed in
federal  court in New Jersey against IDT Corp., plaintiff Michael Jewett claims  
that he was fired because he questioned both the legality and the ethics of
IDT’s plan to deposit termination fees due Haiti Teleco in an offshore  
account called “Mount Salem” for the benefit of Aristide.

The Jewett case alleges that while law-abiding companies were paying
Teleco’s official twenty-three-cent-per-minute rate to terminate calls in Haiti, IDT won a
rate of nine cents per minute. Any carrier with such an advantage could then
wholesale minutes to competitors at just under the official rate and pocket the  
difference. The quid pro quo for the rock-bottom price, according to his  
complaint, was placing settlement fees in an offshore account set up for  
Aristide. That, the complaint says, was Mount Salem. IDT has said the Jewett  
complaint is a “baseless claim by a former disgruntled employee.”  

Mr.  Jewett’s allegations raised a charge of corruption in the Haitian  
presidency in 2003. The Florida action filed by the current  Haitian government
goes into further detail with its allegations. It  claims that in October 1994
Teleco began giving special rates to “class B  carriers” — including Fusion —
to access the Haitian network. Word in  Haiti, as I wrote in 2001, was  that
Fusion even had an office inside Teleco. Along with Mr. Kennedy and Mr. Rosen,
Mr. Clinton’s close confidant Thomas “Mack” McLarty also had a  seat on
Fusion’s board.

The Florida complaint alleges that at a minimum Fusion  — and other class B
carriers — violated U.S.  telecommunication law by “silently accepting those
concessions.” It says  U.S. law “required  telecommunications carriers
providing service between the  U.S. and Haiti to publish and share the most
favorable rates offered by Teleco to any of them.” Fusion says during  the time it
did business with Teleco, it “did nothing improper and made no  illegal
payments” and “never had business dealings nor made any payments  to Mont Salem.”

In 2003, according to the Haitian complaint and Mr. Jewett separately in his
own court case, IDT was offered and accepted a preferential rate similar to
that enjoyed by Fusion and its principals.

“The fraudulent scheme to steal Teleco revenues was carried out in part
through defendant Mont Salem,” says the Florida complaint. The document claims
that at Aristide’s “direction” three of the other defendants in the case
“directed” IDT to make its “payments for Teleco services to Mont Salem.” At
Aristide’s order, “Teleco’s then-counsel also caused Teleco to request at least one
other Class B carrier, Fusion, to make payments through Mont Salem.”

There is plenty more in the complaint, which also accuses Aristide and his
collaborators of  “directing, facilitating and making transfers of public
funds” into  fictitious companies, inflating expense receipts, money laundering,  
smuggling and drug trafficking. It all happened, according to the Haitian  
government’s complaint, to a desperately poor  people and in some instances with
help from rich and politically powerful  Americans.

Charges of this magnitude from a government attempting to rid itself of
political blight deserve serious attention from the Florida federal court, and
one would  think from U.S prosecutors as well.