Good morning, everyone. Thank you for joining us. With me today, to my right, is Lisa Monaco,
the Deputy Attorney General of the United States. And to my left is Matthew Olsen, Assistant
Attorney General of the Justice Department’s National Security Division, as well as Michael
Driscoll, Assistant Director in Charge of the FBI, New York Field Office, we have Darren
McCormack, Deputy Special Agent-in-Charge Homeland Security Investigations, New York,
and NYPD Inspector Roberto Rios, Executive Officer of the Joint Terrorism Task Force. Today, I announce the historic guilty pleas
of two companies for conspiring to provide material support to foreign terrorist organizations. The two companies are Lafarge S.A. and Lafarge
Cement Syria S.A. The foreign terrorist organizations are the
Islamic State of Iraq and al-Sham, better known as “ISIS,” and the al-Nusrah Front,
or “ANF.” These are the first companies ever charged
by the Justice Department with providing material support to foreign terrorist organizations. In addition to pleading guilty, the defendants
agreed, and were sentenced, to pay a total financial penalty of $777.78 million dollars. As I will describe in detail later on, this
sentence is well deserved, because in 2013 and 2014, Lafarge made a deal with the devil. Foreign terrorists who pledged to and in fact
did harm the United States, its people, and its national security, and they did it for
profit. I will now turn it over to Deputy Attorney
General Monaco. Good morning. Thank you, Breon, and thank you all for being
here. Today’s guilty pleas to terrorism charges
by multi-national construction conglomerate Lafarge and its Syrian subsidiary reflect
corporate crime that has reached a new low and a very dark place. For the first time ever, the United States
has charged these companies with providing material support to terrorist organizations
— in this case, the Islamic State of Iraq and al-Sham, or ISIS, and the al-Nusrah Front. And for the first time, companies have pleaded
guilty to supporting terrorist organizations, with Lafarge and its Syrian subsidiary facing
criminal penalties of more than three-quarters of a billion dollars. Protecting national security by fighting international
terrorism is mission-critical for the Department of Justice. And fighting corporate crime is also a top
Department priority. Today’s charges and guilty pleas should
make clear that when companies and their executives engage in conduct that threatens our national
security, in this case by fueling a violent terrorist organizations, the Department will
respond with resolve. And this case also makes clear, business with
terrorists should cannot be business as usual. Since returning to government, I have warned
that companies are on the front lines in confronting today’s geopolitical realities. And in today’s world, corporate crime regularly
intersects with national security in areas like terrorist financing, sanctions evasion,
and cybercrime. Well today, we see that intersection in its
starkest form. Many of our cases of course expose corporate
greed and corruption. But this time, the corporate criminals have
joined hands with the terrorists instead of corrupt government officials. In its pursuit of profits, Lafarge and its
top executives not only broke the law, they helped finance a violent reign of terror that
ISIS and al-Nusrah imposed on the people of Syria. As reflected in today’s guilty pleas, for
years, Lafarge operated a massive cement operation in northern Syria. And in 2012, as that country descended into
civil war, ISIS and al Nusrah gained ground and they gained control of the territory. Many companies made the right choice — the
only lawful choice: to leave the region rather than join hands with the terrorists. Lafarge made a different decision: to go into
business with ISIS and al-Nusrah — two of the world’s most notorious and brutal terrorist
organizations. Between August 2013 and October 2014, Lafarge
capitalized on the Islamic State’s iron grip and violent control of Syria to stifle
its competition and to increase its market share. Lafarge paid millions of dollars to both terrorist
groups and benefited from their brutality to the tune of $70 million in revenue. Lafarge also hid its partnership with these
terrorists through a web of fake contracts, falsified invoices, corrupt intermediaries,
and off-system email accounts. As the Deputy Attorney General and in my previous
role as the President’s Homeland Security and Counterterrorism Advisor, I have witnessed
the unimaginable pain and suffering of American families who has lost loved ones to ISIS. American families whose loved ones were brutally
murdered by ISIS. In the summer of 2014, the world watched in
horror as ISIS murdered innocent journalists and aid workers. That same summer, Lafarge was in business
with ISIS, securing profits and market share and capitalizing on the group’s brutality. Make no mistake: Lafarge and its leadership
had every reason to know exactly with whom they were dealing, they didn’t flinch. Instead, Lafarge forged ahead, working with
ISIS to keep operations open, undercut their competitors, and maximize revenue. And all the while, through their support and
funding, Lafarge enabled the operations of a brutal terrorist group. As also reflected in today’s guilty pleas,
in one email, Lafarge executives discussed how the company could “share the cake”
with ISIS, the “cake” being a callous reference to the profits that Lafarge planned
to reap with its illicit partnership. When that partnership ended, when it came
to a close, the defendants moved to cover their tracks, but the investigation uncovered
the emails Lafarge executives tried to hide. Now, while the facts of this case are extreme,
but they are also instructive of the Department of Justice’s priorities when it comes to
corporate crime and it is instructive about what happens when companies and their executives
make the wrong choices. First, as I have emphasized before, individual
accountability is a top priority. And while I can’t comment on any non-public
DOJ investigations and prosecutions, what I can say is what is already in the public
domain: that French authorities have arrested many of the senior executives implicated in
the scheme that’s detailed here today. This case is therefore, a good example of
international law enforcement cooperation, with partners working independently, but in
parallel, to bring about accountability and justice. In a policy issued last month, I emphasized
that companies who identify misconduct should voluntarily self-report and cooperate with
the Department in a timely and proactive fashion. Lafarge did neither. We also emphasize that companies should have
policies in place to enable retention and production of communications that are conducted
over third-party messaging systems. Lafarge did not. Nonetheless, thanks to the ingenuity and efforts
of our agents and prosecutors, we were able to locate the inculpatory emails that Lafarge
tried to hide off its systems. We’ve also emphasized that companies engaged
in mergers or acquisitions should promptly and properly address compliance issues. Here, the company that acquired Lafarge did
not perform due diligence of Lafarge’s operations in Syria, despite the clear compliance risks
posed by operations in the region. And it did nothing to investigate or address
Lafarge’s illegal activities until they were exposed publicly. We expect far more from companies, particularly
those that operate in high-risk environments. We expect investment in robust and well-resourced
compliance programs, attention to national security compliance risks, and careful due
diligence when it comes to mergers and acquisitions. We will reward voluntary self-reported, we
will reward proactive cooperation with government investigations. And in doing so, we are sending a clear and
unequivocal message: investing in compliance and corporate responsibility is good business. Before I turn the podium back over to Breon,
I want to commend the tireless efforts of the investigators and prosecutors, and our
international partners on this case. It is because of their work, it’s because
of the work of all of the Department’s agents and prosecutors that I can make this promise:
The Department of Justice will not rest and will not hesitate to protect the American
people, in our fight against international terrorism, and in our efforts to hold corporate
wrongdoers accountable. Thank you, Deputy Attorney General Monaco. Before this unprecedented charge, came an
extraordinary crime. During the relevant period, Lafarge was a
France-based company that manufactured cement and other building materials in 61 countries. Lafarge Cement Syria, or “LCS,” as I’ll
refer to them was Lafarge’s subsidiary in Syria. From 2010 to 2014, Lafarge and LCS operated
a cement plant in Northern Syria, near the Turkish border. The construction of the plant cost approximately
$680 million. In 2011, a civil war began in Syria. Armed groups, including ISIS and ANF, fought
against the Syrian government and each other for control of territory and resources. And in 2012 ISIS and ANF gained control of
territory in Syria and committed numerous terrorist acts resulting in the deaths of
many U.S. citizens, among others. In 2012 Lafarge and LCS began to make monthly
payments to various armed groups for protection and by August 2013, payments were made to
ISIS and ANF, two groups that Lafarge knew were designated as foreign terrorist organizations
by the United States. The payments were intended to ensure the safety
of LCS’s employees and the continued operations of the plant. Now while paying armed groups for the privilege
of running a business was bad enough, the payments evolved in even more disturbing ways. In the summer of 2013, Lafarge and LCS began
to negotiate to purchase raw materials from ISIS-controlled suppliers, and eventually
entered into revenue-sharing agreements with ISIS. ISIS would be paid a certain amount of money
per ton of cement LCS sold. And in exchange, LCS was allowed to operate
and generate tens of millions of dollars. LCS even obtained vehicle passes from ISIS
that allowed LCS employees, suppliers and customers to pass checkpoints controlled by
ISIS. Here is a vehicle pass dated April 26, 2014. It bears ISIS letterhead and stamp. It allowed LCS employees “to pass through
after completing the necessary work and after paying their dues to us.” In other words, in exchange for paying ISIS,
and sharing revenue with ISIS, Lafarge and LCS were able to conduct business as usual. And as the scheme evolved, Lafarge and LCS
eventually sought not just permission to operate, but ISIS’s assistance in blocking or taxing
competitors who imported cheaper cement into Syria from Turkey. The decision to become business partners with
ISIS was extraordinary. Leveraging ISIS to harm competitors defies
belief – but it really happened. As a reflection of Lafarge’s awareness that
what it was doing was wrong, the defendants also took steps to conceal their scheme. They asked that the agreements with ISIS not
name Lafarge, and instead refer to the cement plant generically. Lafarge and LCS executives also frequently
used personal email accounts, rather than their corporate email addresses, to communicate
about their illicit arrangements. Again to further hide their conduct. They created invoices with false descriptions
of the identities and work of the intermediaries who brokered the deals with the terrorists. In September and October 2014, when ISIS was
targeting innocent civilians around the world, the executives were focused on how they were
going to pay an intermediary who had previously negotiated a revenue-sharing agreement with
ISIS. So what did they do. The executives created a backdated contract-termination
agreement, falsely showing that the intermediary’s relationship with LCS was terminated on August
18, 2014, now that was the business day after the UN Security Council called on member states
to prohibit business relationships with ISIS. The executives also executed a sham consulting
agreement with the intermediary that was purportedly for “security consulting,” and which authorized
a lump sum payment of $210,000. But that so-called “consulting” agreement
served only to settle the intermediary’s outstanding balance for negotiating with and
paying ISIS on LCS’ behalf. All told, Lafarge and LCS spent millions of
dollars implementing this scheme. First, they paid ISIS and ANF the equivalent
of approximately $6 million. Second, Lafarge and LCS paid a little over
$1 million to third-party intermediaries for negotiating with, and making payments to,
ISIS and ANF. And third, when LCS eventually evacuated the
cement plant in September 2014, ISIS took cement that LCS had produced as part of this
scheme, and sold it at prices that yielded the equivalent of approximately $3.2 million. Let me pause to let that sink in. The defendants paid millions of dollars to
ISIS, a terrorist group that otherwise operated on a shoestring budget. Millions of dollars that ISIS could use to
recruit members, to wage war against governments, and conduct brutal terrorist attacks worldwide,
including against U.S. citizens. This conduct, by a Western corporation, was
appalling, and has no precedent or justification. The defendants did this because the partnership
with ISIS made economic sense. LCS obtained the equivalent of about $70.30
million in revenue in Syria from August 2013 through 2014, during the civil war, and hoped
to earn far more when the war ended and they could exploit their dominant position. Now in July 2015, after the criminal conduct
I have discussed, Lafarge was acquired by its leading competitor, Holcim, a Swiss company. Today, Lafarge is a wholly owned subsidiary
of Holcim. To be clear, Holcim did not participate in
making payments to terrorist groups or in covering up that conduct which had ended before
the acquisition was completed. But although Holcim took steps to investigate
the conduct once public allegations surfaced and engaged in remediation efforts since then,
neither the defendants nor Holcim self-reported the conduct to us nor did they fully investigate
and cooperate in our investigation. Based on the defendants’ conduct and the
other circumstances I just mentioned, the defendants have pled guilty and will pay a
total financial penalty of $777.78 million, consisting of a total criminal fine of $90.78
million and forfeiture of $687 million. And this is the first corporate prosecution
under the material support statute and today’s prosecution should send a clear message that
this Office, and the Department, and its partners, will hold accountable any individual or company
that seeks to leverage the brutality of a terrorist organization for economic gain. Before I finish I want to say a special thanks
to FBI Special Agent Brett Dohnal, HSI Special Agent Megan Shields, NYPD Detective Jaak Leino,
and FBI Forensic Accountants Eunsun “Lauren” Lee and Jenna Casanova. I also want to acknowledge my team standing
here by the Deputy Attorney General, Assistant U.S. Attorneys Allon Lifshitz, Alexander Solomon,
Ian Richardson and Josh Hafetz. We also received important assistance from
Assistant United States Attorneys Artemis Lekakis, Matthew Haggans and Lauren Bowman,
as well as Paralegal Specialists Magdalena St. Surin, Wayne Colon and Ben Richmond. I would also like to acknowledge the work
of Trial Attorneys Bridget Behling and Jenny Levy of the National Security Division’s
Counterterrorism Section. Finally, I want to extend our appreciation
to the Criminal Division’s Office of International Affairs, which provided critical assistance
in this case, and to the French authorities for the significant cooperation and assistance
they provided to the investigation. Thank you. I’ll now turn it over to Matthew Olsen. Thank you Breon. As you’ve heard this morning, there is no
question as to the seriousness of the conduct at the heart of today’s resolution. The defendants routed nearly six million dollars
in illicit payments to ISIS and al-Nusrah Front in Syria, two of the world’s most
notorious terrorist groups. In my time formerly as the Director of the
National Counterterrorism Center, I saw the horrific violence perpetrated by these terrorist
organizations and the ways that they exploited sectarian violence in Syria to seize territory,
coerce the civil population and to generate revenue to accelerate their attack planning. The defendants here negotiated and made unlawful
payments as you’ve heard at a time when these groups were gaining territory and brutalizing
innocent civilians in Syria and elsewhere and were actively plotting against Americans. Lafarge and its Syrian subsidiary have admitted
to engaging in criminal conduct that constitutes material support to terrorism in both legal
and practical terms. And there is no justification, none, for multi-national
corporations authorizing payments to a designated terrorist group. Such payments are egregious violations of
our laws, they justify maximum scrutiny by U.S. authorities, and warrant severe punishment. At the National Security Division we are responsible
for coordinating the Justice Department’s criminal prosecutions of terrorism offenses,
as well as criminal violations of U.S. sanctions and export-control laws. Now more than ever, it is critical that the
United States hold accountable individuals and companies who break our laws by paying
designated entities. In the National Security Division, we are
dedicating additional enforcement resources to meet the urgency of this national security
imperative. Today’s announcement should serve as yet
another reminder that the Department of Justice’s reach is far, and our memory is long. So let me take just a brief moment to emphasize
three points with broader significance for our work. First, U.S. terrorism statutes and our sanctions
and export control laws extend to multi-national companies anywhere that come within the jurisdiction
of our laws. And we are committed to ensuring that companies
that seek access to U.S. markets as well as the U.S. financial systems uphold their basic
obligations under U.S. law. That’s first. Second, this case relates to corporate defendants
acquired by a competitor well after the criminal conduct at issue. This should serve as a cautionary tale. There are risks that come with transactions
involving companies that operate in high-risk environments because of our terrorism designations
and sanctions and export-control laws. Companies will not get a free pass from the
Justice Department simply because they are under new management. And finally, I want to make clear that the
Department cannot and will not accept the notion that this kind of conduct is excused
where corporations try to maintain business operations in places like Syria but do not
share the ideology of terrorist groups. Here, former executives made what they viewed
was a business choice to pay designated terrorist groups as a cost of doing business and as
a way to gain ground on competitors. U.S. law is clear that this was not their
choice to make. And the defendants are now facing the consequences. Thank you. Good morning I do want to thank our colleagues
in the media for joining us today for what we believe is a very important announcement. The plea demonstrates today that the defendants
knowingly funded and conspired with multiple terrorist organizations. The actions of the corporation were motivated
by greed and their financial self interest as it turned a blind eye to the horrors of
terrorism. The corporation made deliberate decisions
to conceal their agreements with terrorist organizations and agreements were set up to
incentivize the foreign terrorist organizations to act in the defendants interest. Thankfully, due to the determination of the
joint terrorism task force the illicit scheme was uncovered and the corporation was held
accountable. Today’s event show that corporations are
no different from individuals, if you fund terrorism you will face the consequences. Willing to fund evil regardless of whether
you are an individual or a large entity please note: that we are unrelenting in our focus
and intent that you serve and receive justice. I do want to acknowledge today the support
of the eastern districts Beyond Peace and this outstanding team at internation security
and cyber crime section and I want to thank Deputy Attorney General Monaco as well as
Asssistant Attorney General Matthew Olson. The Justice Department’s Office of International
Affairs and National Security Division and counter terrorism section provided crucial
support throughout this case and I also very important to acknowledge our partners from
France, Lebanon, and Morocco who helped us with this investigation. This kind of case does not happen without
that international support. I also acknowledge our partners within the
NYPD and HIS who worked this case and who are crucial members of our joint terrorism
task foce. Lastly, I owe a huge thank you to the joint
terrorism task force for over 40 years the joint terrorism task force has focused on
combatting terrorism whether you’re talking about the attack that happened on The New
York subway earlier this year, the countless events that they’ve managed to prevent from
happening, or an issue like that where we are holding individuals accountable for their
funding of terrorism, the joint terrorism task force has focused on keeping this city,
this state and this country safe. It is truly an honor to get to work with you
everyday. So thank them for their dedication and focus,
thank you. My name is Darren McCormack, I’m the deputy
special agent in charge for homeland security investigations abroad. First I’d like to commend and show appreciation
for the HIS, FBI, NYPD agents investigators on behalf of the entire joint terrorism task
force whop make it a fantastic and successful investigation. Additionally, I’d like to show, you know
extend our appreciation to the prosecuting eastern district of New York beyond peace
and your team thank you very much. Like any other terrorist organization ISIS
requires millions of dollars to perpetuate their agenda and spread terror on innocent
people. This morning at 10:20, at the court house
across the street, Lafarge admitted to supply or excuse me, Lafarge plead guilty to supplying
tens of millions of dollars to ISIS with that the foreign subsidiaries demonstrated shocking
degrees of moral and ethical bankruptcy throughout the duration of this case with the knowing
and willful continued partnership with ISIS. So we commend the partners at The JTTF and
The Eastern District. Thank you. What I’ll say is that I think the department
and this office will use all tools at its disposal including the material support statute
to combat terrorist activity as we described ISIS and ANF and others have engaged in brutal
attacks against the United States and its citizens. And it’s a national security interest, we
are invested in trying to prevent those attacks and making sure that those who violate our
terrorism laws are held accountable here in The United States in a court of law I can’t comment on other investigations
or other people or other entities other than the two that plead guilty today. Um I will note that I think it’s The Deputy
Attorney General noted that the principal executive are French Nationals and will be
prosecuted in France or subject to prosecution in France but I can’t comment any further
on any investigation of individuals Like I said before we can’t comment on investigations
or prosecutions of individuals today. To your second question, we haven’t identified
evidence that money was paid by LCF or Lafarge to ISIS or ANF ended up funding the memorial
here in The United States I can’t speak to the details of the French
Investigations or prosecutions there have been some public disclosures about those cases
as well as some public disclosures about court decisions but I really can’t get into details
about that. Sure in the information goes into that I think
it’s fair to say that the material support statutes gives broad jurisdiction for US Courts
to handle cases involving the violation of that statute for conduct that principally
occurred abroad and in this case there are several ways of which that6 can happened and
identified a couple that I’ll share one: there was a US National that was identified
as a coconspirator the other just to mention from a jurisdictional perspective there was
a wire transfer to an intermediary, one of the intermediaries that negotiated with them
paid on behalf of LCS and Lafarge went through The Eastern District of New York so there
are various ways and there are a few that were applied This will certainly be a forfeiture amount
again under terrorism laws is sort of broad the ability to forfeit proceeds and other
assets. In this case the defendant agreed to a forfeiture
amount of 687 million dollars I believe that is made up in part by the value of that plant. We’re not going to seize that plant but
they’re going to give us the value of that plant plus I think the value of the money
that was paid out to coconspirators. Let me check with my team here. It was? It was but it’s not we’re not forfeiting
and taking the plant as a part of this yeah we’re not making it right We’re here to talk about the significance
of this case and the tremendous work of the agents and prosecutors that have made this
case possible so I’ve got nothing for you on that.
