Two accused of taking bribes in U.N. contract deal with U.S. company

By Colum Lynch
Washington Post Staff Writer
Thursday, March 18, 2010; A08

UNITED NATIONS -- A U.N. anti-corruption task force has accused an Italian executive and a former U.N. official of taking bribes from a U.S. security contractor seeking to do business with the United Nations, according to a confidential U.N. letter obtained by The Washington Post.

Ezio Testa, chief executive of IHC Services, and Alexander Yakovlev, a former Russian procurement official at the United Nations, were charged by U.N. investigators with steering a 2001 contract for bulletproof vests to Armor Holdings, a company based in Jacksonville, Fla.

The U.N. letter, written in December 2008, also links the two men for the first time to a criminal probe by the Justice Department's fraud division into a bribery scheme involving former executives at Armor Holdings, which was acquired by BAE Systems in July 2007.

"Mr. Alexander Yakovlev and Mr. Ezio Testa entered into a corrupt agreement to steer a valuable United Nations contract to Armor Holdings in exchange for promises of sums of money to be paid to the individual participants," says the letter from the now-defunct U.N. Procurement Task Force.

The revelations add to a widening federal probe of Armor Holdings, whose former executives stand accused of bribing officials in the Netherlands and at the United Nations. The U.N. letter also provides fresh insights into suspected corrupt practices in the U.N. procurement department as the world body ramped up its peacekeeping operations in the late 1990s.

Reached by phone, Testa declined to discuss the letter's findings and said he had no idea whether federal authorities were probing his alleged links to Armor Holdings. "I am unaware of what you are telling me," he said before hanging up.

Testa, who received U.S. citizenship in 2004, began working in the late 1990s as a liaison for multinational companies seeking contracts for food, body armor and other supplies for U.N. peacekeepers. In 1998, he struck up a friendship with Yakovlev, then at the United Nations, and promised to help him start a marketing business in Moscow, according to a December 2006 report by the U.N. Procurement Task Force.

Testa gave Yakovlev a free cellphone and hired Yakovlev's son, according to the report. Yakovlev gave Testa and his clients internal U.N. documents that helped the firms secure U.N. business, the report and the letter said.

Yakovlev resigned from the United Nations in June 2005. He was subsequently arrested and pleaded guilty to wire fraud and money laundering. As part of his plea agreement, he agreed to cooperate with the prosecution, said his attorney, Arkady Bukh. Bukh said that he did not think Yakovlev was a target of the federal investigation but that he could not reveal whether he was cooperating with federal investigators in the case. "I'm not admitting or denying," Bukh said.

The Justice Department's case came to light in January, when federal authorities charged a former senior official at Armor Holdings, , with paying bribes to U.N. sources to secure insider information on two contracts. The U.N. letter links Bistrong to Testa and Yakovlev. A spokeswoman for the Justice Department, Laura Sweeney, declined to say whether Testa or Yakovlev are the targets of a federal criminal investigation.

According to the letter, Armor Holdings requested "confidential and proprietary" information from the United Nations in May 2001. Four months later, Testa sent Bistrong a copy of an internal U.N. memo with technical evaluation of an ongoing bid for bulletproof vests.

Bistrong's attorney, Brady Toensing, declined to comment on the case. John Suttle, a spokesman for Armor's parent company, BAE, said that the matter predates BAE's acquisition of Armor. "This has nothing to do with BAE Systems," Suttle said.

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