Money Laundering and Asset Recovery Section

Washington, D.C. 20530

April 30, 2020
David H. Braff
Christopher J. Dunne
Sullivan & Cromwell LLP
125 Broad Street
New York, New York 10004-2498
Re:

Bank Hapoalim B.M. and Hapoalim (Switzerland) Ltd. criminal
investigation

Dear Mr. Braff and Mr. Dunne:
The United States Department of Justice, Criminal Division, Money Laundering and
Asset Recovery Section and the United States Attorney’s Office for the Eastern District of New
York (collectively the “Offices”) and Bank Hapoalim B.M. (“BHBM”) and Hapoalim
(Switzerland) Ltd. (“BHS”) (collectively the “Bank”) pursuant to authority granted by BHBM’s
and BHS’s respective Boards of Directors as reflected in Attachment B, enter into this NonProsecution Agreement (“Agreement”). On the understandings specified below, the Offices will
not criminally prosecute the Bank or Hapoalim (Latin America) S.A., which is a wholly-owned
BHBM subsidiary, for any crimes, including conspiracy to launder monetary instruments, in
violation of 18 U.S.C. § 1956(h), (and except for any criminal tax violations, as to which the
Offices do not make any agreement) relating to: (1) any of the conduct described in the
Statement of Facts attached hereto as Attachment A (“Statement of Facts”), or (2) any
information pertaining to the conspiracy to bribe soccer officials, including information
regarding the customers, employees, and payments described in Attachment A, that the Bank
disclosed prior to the Agreement. To the extent there is conduct disclosed by the Bank that is not
described in (1) or (2) of the preceding sentence, such conduct will not be exempt from
prosecution and is not within the scope of, or relevant to, the Agreement. The Bank, pursuant to
authority granted by BHBM’s and BHS’s respective Boards of Directors, also agrees to the terms
and obligations of the Agreement described below.
The Offices enter into the Agreement based on the individual facts and circumstances
presented by this case, and as summarized in the attachments to this Agreement, including:
(a)
the Bank did not receive voluntary disclosure credit because it did not voluntarily
and timely disclose to the Offices the conduct described in the Statement of Facts;
(b)
the Bank received full credit for its exemplary cooperation with the Offices’
investigation, including: conducting an extensive internal investigation, including the review of
more than 250,000 documents and hundreds of audio recordings in multiple countries; making

 factual presentations to the Offices on a wide variety of topics, including the provision of
relevant facts about individual wrongdoers; producing more than 330,000 pages of documents,
including the voluntary production of many documents, and the production of documents from
foreign countries in ways that did not implicate applicable laws; providing factual, nonprivileged summaries of witness interviews; making employees available for interviews;
collecting, analyzing, and organizing voluminous evidence and information for the Offices;
producing translations of key documents and transcriptions of audio files; litigating and
appealing in foreign courts in an attempt to obtain permission to disclose certain employee
identities and documents for production to the Offices; and apprising the Offices of
developments in the Bank’s investigation and remediation, including consulting with the Offices
frequently about changes to the Bank’s corporate structure and employee discipline;
(c)
to the extent consistent with Swiss and Uruguayan law, the Bank provided to the
Offices all relevant facts known to it, including information about the individuals involved in the
conduct described in the attached Statement of Facts and conduct disclosed to the Offices prior
to the Agreement;
(d)
the Bank engaged in extensive remedial measures, including: representing that it
will exit the private banking business outside of Israel and that it has substantially completed that
exit as of the time of this agreement; closing Hapoalim (Latin America) S.A.; closing BHBM’s
branch office in Miami, Florida; closing BHBM’s network of representative offices throughout
Latin America; and representing that it will take all necessary steps to close BHS and surrender
its banking license and that the Bank has completed the sale of most BHS accounts as of the time
of this agreement;
(e)
the nature and seriousness of the offense conduct, including: (1) the duration of
the Bank’s involvement in the offense; (2) the willful participation of at least two relationship
managers in executing the bribe payments; (3) the involvement of multiple Bank affiliates in
executing the bribe payments; and (4) BHS’s failure to address and end the ongoing money
laundering scheme after a BHS compliance employee questioned certain payments and
relationships and repeatedly escalated them to his supervisor, who was then a member of BHS
management, as well as to the relevant relationship manager, who was then the head of BHS’s
South American desk and a senior manager of BHS’s Zurich branch;
(f)

the Bank has no prior criminal history in the United States; and

(g)
the Bank has agreed to continue to cooperate with the Offices in any ongoing
investigation of the conduct of the Bank and its officers, directors, employees, agents, and
external asset managers relating to violations of U.S. money laundering laws.
After considering (a) through (g) above, the Offices believe that an appropriate
resolution of this case is a non-prosecution agreement for the Bank, an aggregate discount of 25
percent off of the bottom of the applicable U.S. Sentencing Guidelines fine range, and forfeiture
in the amount of the bribes laundered through the Bank. In consideration of the Bank’s
remediation, including closing the business units involved in the misconduct and committing to

2

 exit, and substantially exiting, its private banking business outside of Israel, the Offices have
determined that an independent compliance monitor is unnecessary.
The Bank admits, accepts, and acknowledges that it is responsible under U.S. law for the
acts of its officers, directors, employees, and agents as set forth in the attached Statement of
Facts, and that the facts described therein are true and accurate and constitute a violation of law,
specifically conspiracy to launder monetary instruments, in violation of 18 U.S.C. § 1956(h).
The Bank expressly agrees that it shall not, through present or future attorneys, officers,
directors, employees, agents, or any other person authorized to speak for the Bank, make any
public statement, in litigation or otherwise, contradicting the acceptance of responsibility by the
Bank set forth above or the facts described in the attached Statement of Facts. The Bank agrees
that if it or any of its direct or indirect subsidiaries or affiliates issues a press release or holds any
press conference in connection with this Agreement, the Bank shall first consult the Offices to
determine: (a) whether the text of the release or proposed statements at the press conference are
true and accurate with respect to matters between the Offices and the Bank; and (b) whether the
Offices have any objection to the release.
The Bank’s obligations under the Agreement shall have a term of three years from the
date on which the Agreement is executed (the “Term”). The Bank agrees, however, that, in the
event the Offices determine, in their sole discretion, that the Bank, or any of its subsidiaries,
branches, or affiliates, has knowingly violated any provision of this Agreement or has failed to
completely perform or fulfill each of the Bank’s obligations under this Agreement, an extension
or extensions of the Term may be imposed by the Offices, in their sole discretion, for up to a
total additional time period of one year, without prejudice to the Offices’ right to proceed as
provided in the breach provisions of this Agreement below. Any extension of the Agreement
extends all terms of this Agreement for an equivalent period. Conversely, in the event the
Offices find, in their sole discretion, that there exists a change in circumstances sufficient to
eliminate the need for the Bank’s reporting requirements in Attachment C, and that the other
provisions of this Agreement have been satisfied, the Offices may terminate the Agreement
early.
The Bank shall cooperate fully with the Offices in any and all matters relating to the
conduct described in the Agreement and the attached Statement of Facts and other conduct under
investigation by the Offices at any time during the Term, until the later of the date upon which
all investigations and prosecutions arising out of such conduct are concluded, or the conclusion
of the Term. At the request of the Offices, the Bank shall also cooperate fully with other
domestic or foreign law enforcement and regulatory authorities and agencies in any investigation
of the Bank, its present or former subsidiaries or affiliates, or any of its present or former
officers, directors, employees, agents, consultants, external asset managers or any other party, in
any and all matters relating to the conduct described in this Agreement and the attached
Statement of Facts and other conduct under investigation by the Offices at any time during the
Term. The Bank agrees that its cooperation shall include, but not be limited to, the following:
a.
The Bank shall truthfully disclose all factual information with respect to its
activities, the activities of its present and former subsidiaries and affiliates, and the activities of
its present and former directors, officers, employees, agents, consultants, and external asset
3

 managers, including any evidence or allegations and internal or external investigations, about
which the Bank has any knowledge or about which the Offices may inquire. This obligation of
truthful disclosure includes, but is not limited to, the obligation of the Bank to provide to the
Offices, upon request, any document, record, or other tangible evidence about which the Offices
may inquire of the Bank.
b.
Upon request of the Offices, the Bank shall use best efforts to designate
knowledgeable employees, agents, or attorneys to provide to the Offices the information and
materials described above on behalf of the Bank. It is further understood that the Bank must at
all times provide complete, truthful, and accurate information.
c.
The Bank shall use its best efforts to make available for interviews or testimony,
as requested by the Offices, present or former officers, directors, employees, agents, consultants,
and external assets managers of the Bank. This obligation includes, but is not limited to, sworn
testimony before a federal grand jury or in federal trials, as well as interviews with domestic or
foreign law enforcement and regulatory authorities. Cooperation shall include identification of
witnesses who, to the knowledge of the Bank, may have material information regarding the
matters under investigation.
d.
With respect to any information, testimony, documents, records, or other tangible
evidence provided to the Offices pursuant to this Agreement, the Bank consents to any and all
disclosures to other governmental authorities, including United States authorities and those of a
foreign government, of such materials as the Offices, in their sole discretion, shall deem
appropriate.
In addition, during the Term, should the Bank learn of any evidence or allegation of a
violation of U.S. federal law, the Bank shall report such evidence or allegation to the Offices
within thirty (30) days. Sixty (60) days before the Term expires and again on the date that the
Term expires, the Bank, represented by the Chief Executive Officer of BHBM, the Chief
Compliance Officer of BHBM, the Chief Executive Officer of BHS, and the Chief Compliance
Officer of BHS (or, in the event BHS no longer has employees in these roles, an agent
designated to represent BHS), will certify to the Offices that it has met its disclosure obligations
pursuant to this Agreement. If BHS dissolves prior to the expiration of the Term, the Chief
Executive Officer of BHS and Chief Compliance Officer of BHS (or, in the event BHS no longer
has employees in these roles, an agent designated to represent BHS) shall certify to the Offices
that BHS has met its disclosure obligations pursuant to this agreement sixty (60) days prior to
dissolution of BHS and again on the date that BHS dissolves. Each certification will be deemed
a material statement and representation by the Bank to the executive branch of the United States
in the Eastern District of New York for purposes of 18 U.S.C. § 1001.
The Bank represents that it has implemented and will continue to implement an AntiMoney Laundering (“AML”) program designed to prevent and detect violations of applicable
AML laws including the Bank Secrecy Act (“BSA”) and U.S. money laundering statutes,
throughout its operations, including those of its affiliates, subsidiaries, joint ventures, agents, and
external asset managers. To address any deficiencies in its AML program, the Bank represents
that it has undertaken, and will continue to undertake in the future, in a manner consistent with
4

 all of its obligations under this Agreement, a review of its existing AML controls, policies, and
procedures, as well as its compliance with applicable AML laws. Whenever necessary or
appropriate, the Bank agrees to adopt new AML controls, policies, and procedures to ensure that
it maintains a rigorous AML program designed to effectively detect and deter violations of the
BSA, U.S. money laundering statutes, and other applicable laws. As set forth in Attachment C,
the Bank agrees that it will report to the Offices annually during the Term regarding remediation
and implementation of its AML measures (“AML reports”). For the duration of this Agreement,
the Bank shall provide the Offices, upon request, access to any and all non-privileged books,
records, accounts, correspondence, files, and any and all other documents or other electronic
records, including emails, of the Bank and its representatives, agents, affiliates, and employees,
relating to any matters described or identified in the AML reports. The Offices shall have the
right to interview any officer, employee, agent, consultant, or representative of the Bank
concerning any non-privileged matter described or identified in the AML reports. The Bank has
represented that it will close BHS and surrender BHS’s banking license. If, in the sole judgment
of the Offices, the Bank makes best efforts to close BHS and surrender BHS’s banking license,
the obligations of this paragraph and Attachment C shall not apply to BHS.
The Bank shall promptly notify the Offices of: (a) any deficiencies, failings, or matters
requiring attention with respect to the Bank’s AML program identified by any regulatory
authority within 30 business days of any such regulatory notice, provided that the regulatory
authority has granted the Bank permission to notify the Offices; and (b) any steps taken or
planned to be taken by the Bank to address the identified deficiency, failing, or matter requiring
attention. The Offices may, in their sole discretion, direct the Bank to provide other reports
about its AML compliance program.
The Bank agrees to pay a monetary penalty of $9,329,995 (the “Monetary Penalty”) and,
additionally, to forfeit to the United States the sum of $20,733,322 (the “Forfeiture Amount”).
The Forfeiture Amount is based on the minimum amount of funds – at least $20,733,322 – that
was involved in transactions or attempted transactions through accounts at the Bank that were
intended to either promote the bribery scheme described in Attachment A or to conceal the
proceeds thereof. The Bank agrees that the Offices could institute a civil and/or criminal
forfeiture action against funds held by the Bank in the amount of the Forfeiture Amount, and that
such funds would be forfeitable pursuant to 18 U.S.C. §§ 981(a)(1)(A) and 982(a)(1), as property
involved in the violation of 18 U.S.C. § 1956(h). The Bank shall pay the Monetary Penalty and
Forfeiture Amount, plus any associated transfer fees, within seven business days of the date on
which the Agreement is signed, pursuant to payment instructions provided by the Offices in their
sole discretion. The Bank releases any and all claims it may have to the Forfeiture Amount,
agrees that the forfeiture of such funds may be accomplished either administratively or judicially
at the Offices’ election, and waives the requirements of any applicable laws, rules or regulations
governing the forfeiture of assets, including notice of the forfeiture. If the Offices seek to forfeit
the Forfeiture Amount judicially, the Bank consents to entry of an order of forfeiture directed to
such funds. If the Offices seek to forfeit the Forfeiture Amount administratively, the Bank
consents to the entry of a declaration of forfeiture and waives the requirements of 18 U.S.C. §
983 regarding notice of seizure in non-judicial forfeiture matters. The Bank agrees to sign any
additional documents necessary to complete forfeiture of the Forfeiture Amount. The Bank also
agrees that it shall not file any petitions for remission, restoration, or any other assertion of
5

 ownership or request for return relating to the Forfeiture Amount, or any other action or motion
seeking to collaterally attack the seizure, restraint, forfeiture, or conveyance of the Forfeiture
Amount, nor shall it assist any others in filing any such claims, petitions, actions, or motions.
The Bank acknowledges that it shall not claim, assert, or apply for, either directly or indirectly,
any tax deduction, tax credit, or any other offset with regard to any U.S. federal, state, or local
tax or taxable income in connection with the payment of any part of the Monetary Penalty and/or
Forfeiture Amount. The Bank shall not seek or accept directly or indirectly reimbursement or
indemnification from any source with regard to the Monetary Penalty or Forfeiture Amount that
the Bank pays pursuant to the Agreement or any other agreement entered into with an
enforcement authority or regulator concerning the facts set forth in the attached Statement of
Facts. This provision is not intended to relate to derivative claims that have been or may be
brought on behalf of the Bank.
The Forfeiture Amount paid is final and shall not be refunded should the Offices later
determine that the Bank has breached this Agreement and commence a prosecution against the
Bank and/or Hapoalim (Latin America) S.A. In the event of a breach of this Agreement and
subsequent prosecution, the Offices are not limited to the Forfeiture Amount. The Offices agree
that in the event of a subsequent breach and prosecution, they will recommend to the Court that
the amounts paid pursuant to this Agreement be offset against whatever forfeiture or fine the
Court shall impose as part of its judgment. The Bank understands that such a recommendation
will not be binding on the Court.
The Offices may use any information related to the conduct described in the attached
Statement of Facts against the Bank and/or Hapoalim (Latin America) S.A.: (a) in a prosecution
for perjury or obstruction of justice; (b) in a prosecution for making a false statement; (c) in a
prosecution or other proceeding relating to any crime of violence; or (d) in a prosecution or other
proceeding relating to a violation of any provision of Title 26 of the United States Code. This
Agreement does not provide any protection against prosecution for any future conduct by the
Bank or any of its present or former subsidiaries or affiliates. In addition, the Agreement does
not provide any protection against prosecution of any individuals, regardless of their affiliation
with the Bank or any of its present or former subsidiaries or affiliates.
If, during the Term of the Agreement: (a) the Bank commits any felony under U.S.
federal law; (b) the Bank provides in connection with this Agreement deliberately false,
incomplete, or misleading information, including in connection with its disclosure of information
about individual culpability; (c) the Bank fails to cooperate as set forth in the Agreement; or (d)
the Bank otherwise fails to completely perform or fulfill each of its obligations under the
Agreement, regardless of whether the Offices become aware of such a breach after the Term is
complete, the Bank and Hapoalim (Latin America) S.A. shall thereafter be subject to prosecution
for any federal criminal violation of which the Offices have knowledge, including, but not
limited to, the conduct described in the attached Statement of Facts, which may be pursued by
the Offices in the Eastern District of New York, or any other appropriate venue. Determination
of whether the Bank has breached the Agreement and whether to pursue prosecution of the Bank
and/or Hapoalim (Latin America) S.A. shall be in the Offices’ sole discretion. Any such
prosecution may be premised on information provided by the Bank, its subsidiaries or affiliates,
or its personnel, among others. The decision whether conduct or statements of any current
6

 director, officer, or employee, or any person acting on behalf of, or at the direction of, the Bank,
will be imputed to the Bank for the purpose of determining whether the Bank has violated any
provision of this Agreement shall be in the sole discretion of the Offices.
Any such prosecution relating to the conduct described in the attached Statement of Facts
or relating to conduct known to the Offices prior to the date on which the Agreement was signed
that is not time-barred by the applicable statute of limitations on the date of the signing of the
Agreement may be commenced against the Bank, notwithstanding the expiration of the statute of
limitations, between the signing of this Agreement and the expiration of the Term plus one year.
Thus, by signing the Agreement, the Bank agrees that the statute of limitations with respect to
any such prosecution that is not time-barred on the date of the signing of this Agreement shall be
tolled for the Term plus one year. In addition, the Bank agrees that the statute of limitations as to
any violation of U.S. federal law that occurs during the Term will be tolled from the date upon
which the violation occurs until the earlier of the date upon which the Offices are made aware of
the violation or the duration of the Term plus five years, and that this period shall be excluded
from any calculation of time for purposes of the application of the statute of limitations.
In the event the Offices determine that the Bank has breached this Agreement, the Offices
agree to provide the Bank written notice of such breach prior to instituting any prosecution
resulting from such breach. The Bank shall have 30 days upon receipt of notice of a breach to
respond to the Offices in writing to explain the nature and circumstances of such breach, as well
as the actions taken to address and remediate the situation, which explanation the Offices shall
consider in determining whether to pursue prosecution of the Bank and/or Hapoalim (Latin
America) S.A.
In the event that the Offices determine that the Bank has breached the Agreement: (a) all
statements made by or on behalf of the Bank to the Offices or to a court, including the attached
Statement of Facts, and any testimony given by the Bank before a grand jury, a court, or any
tribunal, or at any legislative hearings, whether prior or subsequent to this Agreement, and any
leads derived from such statements or testimony, shall be admissible in evidence in any and all
criminal proceedings brought by the Offices against the Bank; and (b) the Bank shall not assert
any claim under the United States Constitution, Rule 11(f) of the Federal Rules of Criminal
Procedure, Rule 410 of the Federal Rules of Evidence, or any other federal rule that any such
statements or testimony made by or on behalf of the Bank prior or subsequent to the Agreement,
or any leads derived therefrom, should be suppressed or are otherwise inadmissible.
Except as may otherwise be agreed by the parties in connection with a particular
transaction, and excluding the dissolutions of BHS and Hapoalim (Latin America) S.A. and
related asset sales and/or liquidations, the Bank agrees that in the event that, during the Term, it
undertakes any change in corporate form, including if it sells, merges, or transfers business
operations that are material to the Bank’s consolidated operations, or to the operations of any
subsidiaries or affiliates involved in the conduct described in the attached Statement of Facts, as
they exist as of the date of the Agreement, whether such change is structured as a sale, asset sale,
merger, transfer, or other change in corporate form, it shall include in any contract for sale,
merger, transfer, or other change in corporate form a provision binding the purchaser, or any
successor in interest thereto, to the obligations described in this Agreement. The purchaser or
7

 successor in interest must also agree in writing that the Offices' ability to determine that there
has been a breach under lhe AgreemenL is applicable in full force to thaL acquiring or successor
entity. The Bank agrees that the failure to include the Agreement's breach provisions in the
transaction will make any such transaction null and void. The Bank shall provide notice to the
Offices at least thirty (30) days prior to undertaking any such sale, merger, transfer, or other
change in corporate form. The Offices shall notify the Bank prior to such transaction (or series
of transactions) if it determines that the transaction(s) will have the effect of circumventing or
frustrating the enforcement purposes of this Agreement. In addition, if at any time during the
Term the Offices determine in their sole discretion that the Bank has engaged in a transaction(s)
that has the effect of circumventing or frustrating the enforcement purposes of the Agreement, it
may deem it a breach of the Agreement pursuant to the breach provisions of the Agreement.
Nothing herein shall restrict the Bank from indemnifying (or otherwu;e holding harmless) the
purchaser or successor in interest for penalties or other costs arising from any conduct that may
have occurrecl prior to the date of the transaction, so long as such indemnification does not have
the effect of circumventing or frustrating the· enforcement purposes of the Agreement, as
determined by the Offices.
The Bank shall take all steps uece::;sary lo ensure Lhat, regardh:~s::; of the clissolution of
BHS, BHS'srelevant records and information will be preserved and remain accessible in order
to comply with its obligations under the Agreement.
This Agreement is binding on the Bank and the Offices, but specifically does not bind
any other component of the Department of Justice, other federal agencies, or any state, local or
foreign 1aw enforcement or regulatory agencies, or any other authorities, although the Offices
will bring the cooperation of the Bank and its compliance with its other obligations under the
Agreement to the attention of such agencies and authorities if requested to do so by the Bank.
It is further understood that the Bank and the Offices may disclose this Agreement to the
public. Nothing in the Agreement shall require the Bank to violate any applicable law or
regulation. The Agreement sets forth all the terms of the agreement between the Bank and the
Offices. No amendments, modifications, or additions to this Agreement shall be valid unless
they are in writing and signed by the Offices, the attorneys for the Bank, and a duly authorized
representative of the Barile.
Sincerely,
RICHARD P. DONOGHUE
United States Attorney
Eastern District of New Yark

DEBORAH L. CONNOR
Chief
Money Laundering and Asset Recovery Section

By:
Michael P. Grady
Trial Attorney
Bank Integrity Unit
8

 AGREED AND CONSENTED TO:

Bank Hapoalim B.M.
Date:

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Bank Hapoalim B.M.

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Christopher J. Dunne
Sullivan & Cromwell LLP
Hapoalim (Switzerland) Ltd.
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Sullivan & Cromwell LLP

9

 ATTACHMENT A
STATEMENT OF FACTS
The following Statement of Facts is incorporated by reference as part of the NonProsecution Agreement (the “Agreement”) between the United States Department of Justice,
Criminal Division, Money Laundering and Asset Recovery Section and the United States
Attorney’s Office for the Eastern District of New York (collectively the “Offices”) and BANK
HAPOALIM B.M. (“BHBM”) and HAPOALIM (SWITZERLAND) LTD. (“BHS”)
(collectively the “Bank”). The Bank hereby agrees and stipulates that the following information
is true and accurate. The Bank also admits, accepts, and acknowledges that under the laws of the
United States it is responsible for the acts of its officers, directors, employees, and agents as set
forth below:
1.

The Bank admits that its conduct, through the acts of its employees, as described

herein, violated 18 U.S.C. § 1956(h), which makes it a crime to conspire to launder monetary
instruments. Specifically, the Bank admits that, from on or about December 10, 2010 to on or
about February 20, 2015, certain of its relationship managers, one of whom became an external
asset manager during the relevant time period, conspired with sports marketing executives and
soccer officials to execute at least $20,733,322 in bribe payments in furtherance of a scheme in
which sports marketing companies bribed soccer officials in exchange for broadcasting rights to
soccer matches. In conspiring to execute those payments, the relationship managers intended to
promote honest services wire fraud. With respect to certain other payments, the relationship
managers conspired to conceal and disguise the proceeds of bribery. In executing the payments
and maintaining the relationships, the relationship managers also intended, at least in part, to
benefit the Bank, which in fact did realize fees and profits from the accounts in question. A

1

 compliance employee at BHS questioned and escalated certain of the payments, but the Bank
failed to take appropriate action.
Relevant Bank Entities and Employees
2.

BHBM is a multinational financial services company organized and based in Tel

Aviv, Israel. BHBM stock is listed on the Tel Aviv Stock Exchange, and the bank is supervised
by the Bank of Israel.
3.

BHS is a wholly-owned subsidiary of BHBM that is organized in Switzerland and

supervised by the Swiss Financial Market Supervisory Authority (“FINMA”). During the
relevant time period, BHS maintained branches in Zurich and Geneva, Switzerland and
Luxembourg, among other locations, and focused on cross-border private banking. BHS has
sold substantially all of its assets and is preparing to surrender its Swiss banking license.
4.

Hapoalim (Latin America) S.A. is a wholly-owned subsidiary of BHBM that

specialized in private banking in Latin America. Hapoalim (Latin America) S.A. was organized
and licensed in Uruguay and maintained branches in Montevideo and Punta del Este, among
other locations. Hapoalim (Latin America) S.A. ceased operations in or around 2017.
5.

At all relevant times, BHBM maintained a branch in Miami, Florida, among other

locations, that focused on private banking for Latin American customers. BHBM’s Miami
branch was supervised by the Federal Reserve Bank of Atlanta and the Florida Office of
Financial Regulation. BHBM closed its Miami branch in or around 2017.
6.

Co-Conspirator 1, whose identity is known to the Offices and to the Bank, is a

Uruguayan national who, during the relevant period, served as a relationship manager and,
during the summer months, the head of Hapoalim (Latin America) S.A.’s branch in Punta del
Este, Uruguay.

2

 7.

Co-Conspirator 2, whose identity is known to the Offices and to the Bank, is a

national of Switzerland who served at various times during the relevant period as Deputy Branch
Manager at BHS’s Zurich branch, Branch Manager at BHS’s Zurich branch, and Head of the
South America Desk at BHS. In these roles, Co-Conspirator 2 oversaw the operations of BHS’s
Zurich branch as well as its private banking business in Latin America.
8.

Relationship Manager 1, whose identity is known to the Offices and to the Bank,

is an American national and was a relationship manager in BHBM’s Miami branch from
approximately 2007 to 2011.
9.

Compliance Employee 1, whose identity is known to the Offices and to the Bank,

was, during the relevant time period, an employee in the compliance department at BHS in
Zurich, Switzerland.
10.

Compliance Employee 2, whose identity is known to the Offices and to the Bank,

was, during the relevant time period, a supervisor in the compliance department at BHS and
directly supervised Compliance Employee 1 in Zurich, Switzerland. Compliance Employee 2
left BHS in approximately 2019.
Relevant Sports Marketing Companies and Executives
11.

Full Play Group S.A. (“Full Play”) is a sports media and marketing business with

its principal place of business in Argentina. Full Play had a number of subsidiaries and affiliates,
including Bayan Group S.A. (“Bayan”), Cross Trading, S.A. (“Cross Trading”), and Yorkfields,
S.A. (“Yorkfields”), with accounts at the Bank. Specifically, Bayan held an account at BHS;
Cross Trading held two accounts at BHS; and Yorkfields held an account at BHBM’s Miami
branch. On or about March 18, 2020, Full Play was charged along with others in a superseding

3

 indictment in the Eastern District of New York with racketeering conspiracy, wire fraud
conspiracy, money laundering conspiracy, and wire fraud (the “Superseding FIFA Indictment”).
12.

Hugo Jinkis and Mariano Jinkis are Argentinean citizens and were the controlling

principals of Full Play during the relevant time period. On or about May 20, 2015, Hugo and
Mariano Jinkis were first charged along with others in an indictment in the Eastern District of
New York (the “FIFA Indictment”) with racketeering conspiracy, wire fraud conspiracy, and
money laundering conspiracy. The charges arose in part from the facts and bribery schemes
described herein. Hugo Jinkis and Mariano Jinkis were also charged with these offenses, as well
as wire fraud, in the Superseding FIFA Indictment.
Relevant FIFA Entities and Soccer Officials
13.

The Fédération Internationale de Football Association (“FIFA”) is an

international body that governs and promotes the sport of soccer throughout the world. FIFA is
organized and registered under Swiss law and its headquarters is located in Zurich, Switzerland.
FIFA is comprised of six continental confederations, various regional federations, and more than
200 member associations, each representing organized soccer in a particular nation or territory.
14.

The Confederación Sudamericana de Fútbol (“CONMEBOL”) is one of the six

continental soccer confederations affiliated with FIFA. CONMEBOL, which is domiciled and
headquartered in Paraguay, governs soccer in South America and has 10 national soccer
association members. Among other tournaments, CONMEBOL organizes the Copa América,
Copa Libertadores, and Copa Sudamericana.
15.

Rafael Esquivel is a citizen of Venezuela. At various times, he served as the

president of the Venezuelan Football Federation and a member of CONMEBOL’s executive
committee. Between approximately 2009 and 2014, Esquivel received at least 34 bribe

4

 payments, totaling approximately $9,416,362, from the Yorkfields account at BHBM’s Miami
branch and the Cross Trading and Bayan accounts at BHS. On or about November 10, 2016,
Esquivel pleaded guilty in the Eastern District of New York to racketeering conspiracy and
multiple counts of wire fraud conspiracy and money laundering conspiracy. The charges arose
in part from the facts and bribery schemes described herein.
16.

Luis Bedoya is a citizen of Colombia. At various times, he served as the

president of the Colombian Football Federation, a vice president of CONMEBOL, and a member
of FIFA’s executive committee. Between approximately 2008 and 2015, Bedoya received at
least 19 bribe payments from accounts associated with Hugo and Mariano Jinkis, totaling
approximately $3,815,000, into accounts that Bedoya held at BHBM’s Miami branch and BHS
under the name Flemick S.A. (“Flemick”). On or about November 12, 2015, Bedoya pleaded
guilty in the Eastern District of New York to racketeering conspiracy and wire fraud conspiracy.
The charges arose in part from the facts and bribery schemes described herein.
17.

Luis Chiriboga is a citizen of Ecuador who served as president of the Ecuadorian

Football Association. Between approximately 2009 and 2014, Chiriboga’s son, Jose Luis
Chiriboga, received at least 12 bribe payments, totaling approximately $2,125,000, on behalf of
his father from accounts associated with Hugo and Mariano Jinkis at BHS and BHBM’s Miami
branch. On or about November 25, 2015, Luis Chiriboga was charged in a superseding
indictment with racketeering conspiracy, as well as multiple counts of wire fraud conspiracy and
money laundering conspiracy. The charges arose in part from the facts and bribery schemes
described herein.
18.

Sergio Jadue is a citizen of Chile who served as the president of the National

Football Association of Chile and a vice president of CONMEBOL. In or around 2014, Jadue

5

 received at least three bribe payments, totaling approximately $1,546,500, from the Bayan
account at BHS. On or about November 23, 2015, Jadue pleaded guilty in the Eastern District of
New York to racketeering conspiracy and wire fraud conspiracy. The charges arose in part from
the facts and bribery schemes described herein.
19.

Eugenio Figueredo is a citizen of the United States and Uruguay, and has

maintained a residence in Arcadia, California since approximately 2005. Figueredo was the
president of CONMEBOL from in or around April 2013 to August 2014, a member of FIFA’s
executive committee from in or around May 2013 to May 2015, and previously served as a vice
president of CONMEBOL and president of the Uruguayan Football Association. Between
approximately 2012 and 2014, Figueredo received at least three bribe payments, totaling
approximately $950,000, from accounts at BHS. On or about May 20, 2015, Figueredo was
charged in the FIFA Indictment with racketeering conspiracy, wire fraud conspiracy, money
laundering conspiracy, unlawful procurement of naturalization, and aiding and assisting in the
preparation of false and fraudulent tax returns.
The Bank’s Participation in the FIFA Bribery Schemes
20.

Between approximately 2010 and 2015, Bank personnel, including Co-

Conspirators 1 and 2, conspired with Hugo Jinkis, Mariano Jinkis, Rafael Esquivel, Luis Bedoya,
and others to launder funds through accounts at the Bank in furtherance of several bribery
schemes related to FIFA. During this same time period, Bank personnel failed to properly
investigate and address indicia of money laundering and red flags raised by certain bank
employees in connection with the various accounts held by Full Play and its affiliates.

6

 National Football Federation Bribery Schemes
21.

Beginning in or around 2007, Full Play bribed numerous soccer officials affiliated

with the national soccer federations of Colombia, Venezuela, Ecuador, and Bolivia in exchange
for the broadcasting rights to the respective national soccer teams of those federations. Full Play
made at least 15 bribe payments, totaling approximately $1,740,000, from the Yorkfields account
at BHBM’s Miami branch to accounts owned and/or controlled by soccer officials, or for the
benefit of soccer officials. Four of those payments were wire transfers to banks located outside
the United States. Full Play also made another bribe payment of approximately $130,000 from a
Cross Trading account at another bank in the United States to Bedoya’s account at BHBM’s
Miami branch.
22.

Relationship Manager 1, who served as the primary relationship manager for the

Yorkfields account at BHBM’s Miami branch from approximately 2007 to 2009, understood that
Full Play was making payments to soccer officials in exchange for their assistance in the award
of broadcasting rights. In a call report dated on or about July 7, 2008, Relationship Manager 1
stated that Bedoya was the president of the Colombian Football Federation and that Bedoya was
opening an account at BHBM’s Miami branch because he had “decided to commence a new
venture in which he has established a new company that will be in the business of securing
transmission rights to transmit soccer games throughout Colombia not only involving the local
teams, but where the Colombian National team is involved as well.” Relationship Manager 1
went on to explain that “[t]he initial payment to open the account is appx. $500K, which as I
mentioned earlier is derived from payments received from Mr. Jinkis for the assistance Mr.
Bendoya’s (sic) company provided to the Jinkis[es] in obtaining the rights for the transmission of
soccer matches throughout Colombia.”

7

 23.

Many of the bribe payments from the Yorkfields account triggered the Bank’s

internal anti-money laundering alerts. These alerts generally required Relationship Manager 1 to
provide an explanation to the Bank’s compliance department for the payment in question, after
which a Bank compliance analyst would be required to review and approve the explanation and
remove the alert before the payment could be made. Despite the alerts and the red flags raised
by certain of the explanations given to the Bank’s compliance department for these bribe
payments, the bribe payments were ultimately approved.
24.

For example, on or about November 7, 2007, Yorkfields executed a payment of

approximately $200,000 to a casa de cambio, or currency exchange house, for further payment to
a Bolivian Football Federation official as compensation for the award of broadcasting rights by
the Bolivian Football Federation to Full Play for the Bolivian national team. In response to
questions from the Bank’s compliance department, Relationship Manager 1 drafted a call report
explaining: “On 11/7/07 there was a wire made in the amount of 200K to [the Bolivian Football
Federation official] through [the casa de cambio official] (Casa de Cambio). This payment was
made to pay for broadcasting rights for the Bolivian National Team.” A BHBM compliance
employee subsequently performed an internet search and confirmed that the individual was “an
executive with the Bolivian Football Federation,” and Relationship Manager 1 informed the
compliance employee that the soccer official had instructed that the payment be made to the casa
de cambio. After receiving this additional information, the BHBM compliance employee cleared
the alert and took no further action, notwithstanding the fact that Yorkfields was purportedly
paying an individual, “an executive with the Bolivian Football Federation,” for rights to the
Bolivian national team and directing that the payment be made to an unrelated third party, the
casa de cambio.

8

 25.

On or about May 19, 2009, the Bank’s compliance department requested an

explanation for an approximately $150,000 payment from the Yorkfields account to an
individual whom the compliance department could not identify via web searches. Relationship
Manager 1 responded that the recipient: “is affiliated with [the] Colombian Futbol Federation
[and] this is a payment for rights to transmit the Colombian National Team on TV.”
Notwithstanding the fact that Yorkfields was paying an individual for rights to the Colombian
national team, the Bank’s compliance department responded that it had found no negative
information about the recipient and wrote: “No further information required.”
26.

On or about June 18, 2009, Yorkfields made a wire transfer of approximately

$200,000 to Benz Corporation, a company owned by Esquivel. The prior day, Relationship
Manager 1 had a call with Mariano Jinkis about the payment, in anticipation of questions from
the Bank’s compliance department. Jinkis told Relationship Manager 1 that Benz was an
“offshore” and that the requested wire transfer was for “the payment of television rights of the
Venezuelan Football Federation.” The following day, BHBM executed the payment as
requested.
The Copa América and Copa América Centenario Bribery Scheme
27.

From approximately 1987 to 2011, Traffic Sports (“Traffic”), a Brazilian sports

marketing company, held the commercial rights to CONMEBOL’s Copa América soccer
tournament. At various times during that period, Traffic agreed to pay bribes to various
CONMEBOL officials in exchange for their support for Traffic’s position as the exclusive holder
of those rights.
28.

In or around 2009, a group of six presidents of the traditionally less-powerful

member associations of CONMEBOL formed a bloc to obtain greater control over decisions

9

 relating to the governance of CONMEBOL and the sale of CONMEBOL’s commercial
properties, decisions which previously had been dominated by the representatives of soccer
powers Argentina and Brazil. Starting in or around 2009, the members of the “Group of Six,” as
the members of the bloc were known, demanded that they, too, receive annual bribe payments in
exchange for their support for the award of broadcasting rights.
29.

In or around 2010, CONMEBOL terminated its longstanding relationship with

Traffic and entered into an agreement with Full Play, granting Full Play exclusive media and
marketing rights for the 2015, 2019, and 2023 editions of the Copa América, among other
tournaments. To win that contract, Full Play’s principals, Hugo and Mariano Jinkis, agreed to
pay bribes to various CONMEBOL officials.
30.

Hugo and Mariano Jinkis used the Cross Trading and Bayan accounts at BHS to

execute bribe payments in furtherance of this scheme. With regard to Cross Trading, between
approximately March 5, 2010 and March 13, 2014, BHS executed at least 53 bribe payments,
totaling more than $14,029,822, from the Cross Trading account to Bedoya, Chiriboga, Esquivel,
Figueredo, and others. Between approximately January 21, 2014 and February 20, 2015, BHS
executed at least fifteen bribe payments, totaling approximately $4,833,500, from the Bayan
account to Bedoya, Chiriboga, Esquivel, Figueredo, Jadue, and others. Many of the bribe
payments were wire transfers from BHS to accounts in the United States, including accounts in
the name of Jose Luis Chiriboga at three financial institutions in the United States and Esquivel’s
accounts at two financial institutions in the United States.
Willful Participation in the Bribery Schemes
31.

Co-Conspirators 1 and 2, both senior managers at Hapoalim (Latin America) S.A.

and BHS, respectively, willfully furthered the bribery schemes by enabling their clients to use

10

 accounts at the Bank to pay bribes in furtherance of those schemes. By approximately 2010, CoConspirators 1 and 2 understood that Hugo and Mariano Jinkis were paying bribes to FIFA
officials. On or about December 10, 2010, Co-Conspirator 1 wrote in an email to CoConspirator 2: “The Js [Jinkises] are going to grow like 5 million net in 2011. With the [a Swissbased bank unaffiliated with Bank Hapoalim], they handle the ‘bribes’ that they have to give,
and hopefully it will continue like that.” Co-Conspirator 1 went on to explain that a banker at
the Swiss-based bank “opened accounts for all the presidents of the football confederations, so hj
[Hugo Jinkis] could pay them from an account that [he] only uses for that, [he] doesn’t have any
other investments with them.”
32.

At approximately the same time, Co-Conspirators 1 and 2 also knew or soon

learned that Hugo and Mariano Jinkis were paying bribes through accounts at BHS.
33.

For example, on or about June 15, 2010, Bedoya signed account opening

documents for an account at BHS, with Co-Conspirator 2 as the relationship manager. In or
around November 2010, Bedoya transferred all funds from his account at BHBM’s Miami
branch to this new account at BHS, and closed the account in the United States.
34.

Over the next two years, Compliance Employee 1 raised a series of concerns with

Co-Conspirator 2 and Compliance Employee 2 about Hugo and Mariano Jinkis, Full Play, and/or
its subsidiaries or affiliates making payments to Bedoya in connection with the award of
broadcasting rights. For example, on or about March 10, 2011, Compliance Employee 1 wrote
to Co-Conspirator 2 and Compliance Employee 2, among others, about two recent payments
from Cross Trading to Bedoya, each for $250,000. Compliance Employee 1 explained that
Bedoya was “the President of the Colombian Football Association, Director of the Executive
Committee of the South American Football Federation, a member of the marketing commission

11

 of the Colombian Olympic Committee and a member of the FIFA’s commission for the football
player’s statute.” Compliance Employee 1 then noted that “CROSS TRADING SA is a
company active in the marketing of TV rights for sports events,” and requested additional
information about “the advisory services rendered by Flemick to Cross Trading SA” and a copy
of the underlying advisory agreement.
35.

On or about August 30, 2011, Compliance Employee 1 followed up on his request

for additional information, writing to Co-Conspirator 2 and Compliance Employee 2: “I think
you must discuss the payments with the owner of FLEMICK (Mr. B.); the company that received
the payments. We must fully understand the economic background of these payments (for what
specific consulting services Flemick received these funds, the underlying contracts etc.)[.] The
payments are not in accordance with the client profile of Flemick (Mr. B.). How does Mr. B. see
his consulting activities in relation to his positions with FIFA, CONMEMBOL, Olympic
Committee, Colombian Football Association etc.? The reputational risk in regards to this client
(PEP) for the bank is substantial.”
36.

On or about December 22, 2011, Compliance Employee 1 wrote to Co-

Conspirator 2 and Compliance Employee 2: “Cross Trading transferred USD 1 Mio. to the
account Flemick. The beneficial owner of Flemick is a high ranking football official. Among
others he is part of the FIFA leadership. The letter provided is only a general letter. Is there
really no written agreement or contract between Flemick and Cross Trading?”
37.

Finally, on or about May 30, 2012, Compliance Employee 1 wrote to Compliance

Employee 2: “I closed today two alerts from the following clients: Cross Trading (B.O.: Hugo
Jinkis, Mariano Jinkis)[;] Flemick S.A. (B.O.: Luiz Bedoya)[.] Hugo and Mariano Jinkis are
through Cross Trading and other companies active in the field of trading with TV rights for sport

12

 events including football events and games. Luiz Bedoya is a high ranking sport official from
Colombia. Among others, Mr. Bedoya is he currently a member of the FIFA Players’ Status
Committee and is the President of the Federacion Colombiana de Futbol (Colombian Football
Federation). There were payments from the account of Cross Trading to the account of Flemick
SA. Both clients issued written statements (see attachments) that they maintain commercial
relations regarding to TV rights and publicity related to sports events as well as commercial
activities with football players. These payments are related to advisory services provided by
Flemick SA to Cross Trading in this respect. According to the clients, they do not have a written
agreement between them. As we have classified Mr. Bedoya as a PEP, I would like to bring
these transactions to the attention of the Management of our bank.”
38.

Despite Compliance Employee 1’s concerns about Full Play’s payments to

Bedoya, Co-Conspirator 1 and BHS continued executing payments to soccer officials from the
Cross Trading and Bayan accounts. Co-Conspirators 1 and 2 also conspired to launder bribe
proceeds in order to conceal the origin and ownership of the funds. For example, on or about
December 5, 2013, Co-Conspirator 1 wrote to Co-Conspirator 2: “I recently spoke with the
Venezuelan [Esquivel], the account he will open will be under a new corporation that will be
handled by Hugo [Jinkis] with his firm. He confirms that both bank sources are from the United
States. He asked me if he can send money directly to Hugo’s account and then transfer it back to
his new account, I mentioned [to] him that it could be difficult, but that I would ask.” CoConspirator 2 responded: “Will the money come from BENZ [an entity owned by Esquivel] in
those banks? Or from where? No, Hugo cannot get caught.” The Bank did not ultimately open
the referenced account.

13

 39.

Co-Conspirator 1’s statements on recorded phone calls further confirm that he

understood that the payments he helped execute through the Bank’s accounts constituted money
laundering. For example, on or about May 27, 2015, Co-Conspirator 1 had the following phone
conversation with his spouse:
Spouse: Hi.
Co-Conspirator 1: What’s up?
Spouse: Hi.
Co-Conspirator 1: I’m f****d.
Spouse: What?
Co-Conspirator 1: You’re f****d.
Spouse: Oof.
…
Co-Conspirator 1: Listen.
Spouse: I’m listening.
Co-Conspirator 1: Have you seen what I was telling you, today I was looking at the
FIFA thing, [INDISCERNIBLE] I told you something about FIFA, right?
Spouse: No, you said ... I heard that they sued six.
Co-Conspirator 1: Six. Yes, six from FIFA.
Spouse: For...
Co-Conspirator 1: Eugenio Figueredo [INDISCERNIBLE].
Spouse: Yes.
Co-Conspirator 1: And the one who’s stuck in the mess is Hugo.
Spouse: Seriously?

14

 Co-Conspirator 1: And, since there were wiretaps on the phone, the US government and
... you can imagine! It came out in the news. In I don’t know what newspaper, he and
the [INDISCERNIBLE].
Spouse: With their names?
Co-Conspirator 1: The names.
Spouse: Nooooooooo.
Co-Conspirator 1: So it seems to me that I’ll dedicate myself to my ranch.
…
Spouse: Yeah, but the blame ... he’s not involved in this big mess.
Co-Conspirator 1: In the money laundering yes, in helping the laundering, in a way,
because it’s ... let’s say they’re accused of corruption, of receiving bribes.
Spouse: Yes
Co-Conspirator 1: And the bribes were given by [INDISCERNIBLE].
Spouse: Ahhhh.
Co-Conspirator 1: Part of the bribes, right?
Spouse: Of course. Yes, because they said there that it was, including things, what was
it? Chronic ones too.
Co-Conspirator 1: So early?
Spouse: Hmmmm.
Co-Conspirator 1: I’ll warn you that yesterday, just yesterday, the department of
compliance in Switzerland, after 3 months authorized the seizing of an account that’s
linked to FIFA.

15

 ATTACHMENT B
CERTIFICATE OF CORPORATE RESOLUTIONS
WHEREAS, Bank Hapoalim B.M. (“BHBM”) has been engaged in discussions with the
United States Department of Justice, Criminal Division, Money Laundering and Asset Recovery
Section and the United States Attorney’s Office for the Eastern District of New York (collectively
the “Offices”) regarding BHBM’s involvement in the laundering of monetary instruments in
connection with bribe payments from sports marketing companies to soccer officials affiliated with
the Fédération Internationale de Football Association (“FIFA”) and other soccer organizations and
WHEREAS, in order to resolve such discussions, it is proposed that BHBM enter into this
non-prosecution agreement (the “Agreement”) with the Offices; and
WHEREAS, outside counsel for BHBM has advised the Board of Directors of BHBM of
its rights, possible defenses, the U.S. Sentencing Guidelines’ provisions, and the consequences of
entering into such agreement with the Offices;
Therefore, the Board of Directors has RESOLVED that:
1.

BHBM: (a) enters into this Agreement with the Offices; and (b) agrees to pay,

jointly with Hapoalim (Switzerland) Ltd., a total of $30,063,317 to the United States, which
includes a monetary penalty of $9,329,995 and funds to be forfeited in the amount of $20,733,322;
2.

BHBM accepts the terms and conditions of this Agreement, including, but not

limited to: (a) a knowing waiver for purposes of this Agreement and any charges by the United
States arising out of the conduct described in the attached Statement of Facts of any objection with
respect to venue in the United States District Court for the Eastern District of New York; and (b)
a knowing waiver of any defenses based on the statute of limitations for any prosecution relating
to the conduct described in the attached Statement of Facts or relating to conduct known to the

 Offices prior to the date on which this Agreement was signed that is not time-barred by the
applicable statute of limitations on the date of the signing of this Agreement;
3.

The Chief Executive Officer ofBHBM, Dov Kotler, and Chief Legal Advisor of

BHBM, Yael Almog, are hereby jointly authorized, empowered and directed, on behalf of BHBM,
to execute the Agreement substantially in such form as reviewed by this Board of Directors at this
meeting with such minor changes as either the Chief Executive Officer of BHBM, Dov Kotler, or
the Chief Legal Advisor ofBHBM, Yael Almog, may approve;

4.

The Chief Executive Officer of BHBM, Dov Kotler, and Chief Legal Advisor of

BHBM, Yael Almog, are hereby each individually authorized, empowered and directed to take
any and all actions as may be necessary or appropriate to approve the forms, terms, or provisions
of any agreement or other documents as may be necessary or appropriate, to carry out and
effectuate the purpose and intent of the foregoing resolutions; and

5.

All of the actions of the Chief Executive Officer of BHBM, Dov Kotler, and the

Chief Legal Advisor of BHBM, Yael Almog, which actions would have been authorized by the
foregoing resolutions except that such actions were taken prior to the adoption of such resolutions,
are hereby severally ratified, confirmed, approved, and adopted as actions on behalf of BHBM.

Date:

'%· r ,.J) 1.,l
V

I

'f ' Lr ci
By:
Chairman
Bank Hapoalim B.M.

 CERTIFICATE OF CORPORATE RESOLUTIONS
WHE

S, Hapoalim (Switzerland) Ltd. ("BHS") has been engaged in discussions

with the United tates Department of Justice, Criminal Division, Money Laundering and Asset
Recovery Sectio and the United States Attorney' s Office for the Eastern District of New York
(collectively the "Offices") regarding BHS ' s involvement in the laundering of monetary
instruments in c nnection with bribe payments from sports marketing companies to soccer
officials affiliate with the Federation Internationale de Football Association ("FIFA") and other
soccer organizati ns; and
WHERE S, in order to resolve such discussions, it is proposed that BHS enter into this
non-prosecution greement (the "Agreement") with the Offices; and
WHERE S, outside counsel for BHS has advised the Board of Directors of BHS of its
rights, possible efenses, the U.S. Sentencing Guidelines ' provisions, and the consequences of
entering into sue agreement with the Offices;
Therefor , the Board of Directors has RESOLVED that:
1.

HS: (a) enters into this Agreement with the Offices; and (b) agrees to pay,
Hapoalim B.M., a total of $30,063,317 to the United States, which includes a

monetary penal
2.
limited to: (a) a

of$9,329,995 and funds to be forfeited in the amount of$20,733 ,322;
' HS accepts the terms and conditions of this Agreement, including, but not
owing waiver for purposes of this Agreement and any charges by the United

States arising ou of the conduct described in the attached Statement of Facts of any objection
with respect to v nue in the United States District Court for the Eastern District of New York;
and (b) a knowin waiver of any defenses based on the statute of limitations for any prosecution
relating to the co duct described in the attached Statement of Facts or relating to conduct known

 to the Offices pri r to the date on which this Agreement was signed that is not time-barred by the
applicable statut of limitations on the date of the signing of this Agreement;

3.

e Chief Executive Officer of BHS, Barry Elram, and Head of Legal,

Compliance and Tax of BHS, Claudia Spiess, are hereby jointly authorized, empowered and
directed, on beh f of BHS, to execute the Agreement substantially in such form as reviewed by
this Board of Di ectors at this meeting with such minor changes as either the Chief Executive
Officer of BHS,

arry Elram, or Head of Legal, Compliance and Tax of BHS, Claudia Spiess,

may approve;

4.
Compliance

he Chief Executive Officer of BHS, Barry Elram, and Head of Legal,
Tax of BHS, Claudia Spiess, are hereby each individually authorized,

empowered and directed to take any and all actions as may be necessary or appropriate to
approve the fo

s, terms, or provisions of any agreement or other documents as may be

necessary or ap ropriate, to carry out and effectuate the purpose and intent of the foregoing
resolutions; and

5.

II of the actions of the Chief Executive Officer of BHS, Barry Elram, and Head

of Legal, Comp, iance and Tax of BHS, Claudia Spiess, which actions would have been
authorized by th foregoing resolutions except that such actions were taken prior to the adoption
of such resolutio s, are hereby severally ratified, confirmed, approved, and adopted as actions on
behalf of BHS.

rate Secretary
alim (Switzerland) Ltd.

 ATTACHMENT C
REPORTING REQUIREMENTS
BANK HAPOALIM B.M. and HAPOALIM (SWITZERLAND) LTD. (collectively the
“Bank”) agree that they will report to the United States Department of Justice, Criminal
Division, Money Laundering and Asset Recovery Section and United States Attorney’s Office
for the Eastern District of New York (the “Offices”) periodically, at no less than twelve-month
intervals during a three-year term, regarding remediation and implementation of the Bank’s AntiMoney Laundering (“AML”) program. During this three-year period, the Bank shall: (1)
conduct an initial review and submit an initial report; and (2) conduct and prepare at least two (2)
follow-up reviews and reports, as described below:
1.

By no later than one year from the date the Agreement is executed, the Bank shall

submit to the Offices a written report setting forth a complete description of its remediation
efforts to date, its proposals to improve the Bank’s policies, procedures, and controls to ensure
compliance with applicable AML laws, and the proposed scope of the subsequent reviews. The
Bank shall send the report to the following individuals: (1) Chief – Bank Integrity Unit, Money
Laundering and Asset Recovery Section, Criminal Division, U.S. Department of Justice, 1400
New York Avenue, NW, Bond Building, Tenth Floor, Washington, D.C. 20530, and (2) Chief –
Business and Securities Fraud Section, United States Attorney’s Office for the Eastern District of
New York, 271 Cadman Plaza East, Brooklyn, New York 11201. The Bank may extend the time
period for issuance of the report with prior written approval of the Offices.
2.

The Bank shall undertake at least two (2) follow-up reviews and reports,

incorporating the Offices’ views on the prior reviews and reports, to further monitor and assess
whether the Bank’s policies, procedures and controls are reasonably designed to detect and
prevent violations of applicable AML laws.
1
 

 3.

The Bank shall complete the first follow-up review and report no later than one

year after submitting the initial report to the Offices. The Bank shall complete and deliver the
second follow-up review and report to the Offices no later than thirty (30) days before the end of
the Term.  In preparing the reports referenced in Attachment C, the Bank shall not be required to
violate any applicable law or regulation.
4.

The reports will likely include proprietary, financial, confidential, and competitive

business information. Moreover, public disclosure of the reports could discourage cooperation,
impede pending or potential government investigations and thus undermine the objectives of the
reporting requirement. For these reasons, among others, the reports and the contents thereof are
intended to remain and shall remain non-public, except as otherwise agreed to by the parties in
writing, or except to the extent that the Offices determine in their sole discretion that disclosure
would be in furtherance of the Offices’ discharge of their duties and responsibilities or is
otherwise required by law.
5.

The Bank may extend the time period for submission of any of the follow-up

reports with prior written approval of the Offices.

2