Case File

Armor Holdings and the United Nations

Author
Sam Perlo-Freeman
Published on
September 3, 2020
(updated September 11, 2026)
Image
UN peacekeepers in South Sudan conduct a riot control training exercise in May 2015. Source: Flickr/Creative Commons, United Nations Photo.
UN peacekeepers in South Sudan conduct a riot control training exercise in May 2015. Source: Flickr/Creative Commons, United Nations Photo.
UN peacekeepers in South Sudan conduct a riot control training exercise in May 2015. Source: Flickr/Creative Commons, United Nations Photo.

Contents

Contents

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Introduction

Introduction

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In a rare case in which an executive involved in paying bribes actually went to prison, Richard Bistrong's story took several unexpected turns. As vice president for international sales at Armor Holdings - acquired by BAE Systems in 2007 - Bistrong admitted in 2010 to arranging more than $200,000 in payments to a U.N. official through intermediaries to help secure contracts for body armour, helmets, and other protective equipment.

The fallout was substantial. Armor Holdings paid $16 million in fines as part of a settlement and admitted to $4.4 million in undisclosed commission payments made by Bistrong and others over several years. But Bistrong's story did not end with his guilty plea. Before entering his plea agreement, he became a cooperating witness for US federal authorities and played a central role in a high-profile corruption sting that resulted in 22 arrests - though the operation ultimately produced no convictions.

Since then, Bistrong has reinvented himself as an anti-corruption blogger and consultant, turning his experience on the other side of corporate compliance into a career advising others on how corruption works - and how to prevent it.

Case Details

Case details

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Seller country
United States
Seller company
Armor Holdings (now BAE Systems Land & Armaments)
Buyer country
United Nations
Goods category
Body Armour, Law Enforcement Equipment
Equipment sold
Body armor, helmets, pepper spray, police batons, other law enforcement equipment and accessories
Deal value
$7.1 Million
Start year
2001
End year
2012
Outcome status
Trial Closed - Some Convictions

Actors

Actors

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  • Richard T. Bistrong - Armor Holdings Vice President for Sales (1994-2007); convicted of bribery and sentenced to 18 months in prison; now heads his own consultancy Front-Line Anti-Bribery LLC; former Member of the OECD, Secretary General High-Level Advisory Group on Integrity and Anti-Corruption

  • Armour Holdings - Now defunct arms company specialising in the manufacture and sale of military, law enforcement, and personnel safety equipment; headquartered in Jacksonville, Florida; acquired in 2007 by BAE Systems Inc, an indirect wholly-owned US subsidiary of Britain's BAE Systems PLC.

  • Armor Holdings Products, LLC - Now dissolved Delaware limited liability company and subsidiary of Armor Holdings; headquartered in Jacksonville, Florida.

  • Armor Products International, Ltd - Now dissolved subsidiary of Armor Holdings Products; headquartered in Liverpool, England.

Timeline

Timeline

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2001
  • SepA third-party intermediary instructed Armor Products International (API), a subsidiary of Armor Holdings, to sign a blank pricing sheet. The intermediary planned to fill in the prices later, after obtaining confidential information from a UN procurement official about competitors’ non-public bids for the contract.
  • API agreed to pay the intermediary a success fee in the form of a percentage of value of any contract obtained from the U.N
  • The third-party intermediary obtained a confidential internal UN memorandum recommending that API be awarded the contract. The intermediary immediately emailed this internal U.N. document to an agent of Armor Holdings - advising him to "PLEASE DESTROY AFTER READING."
  • OctThe UN awarded API a multi-year contract for the supply of body armor.
2003
  • FebAn Armor Holdings agent asked the third-party intermediary how API could win the contract to renew its body-armour supply agreement with the UN The intermediary responded that the 2003 tender would be governed by the same rules as the 2001 tender.
  • AugAPI received another three-year contract from the UN.
2006
  • API received an additional one-year supply extension from the UN.
  • By late 2006, agents of Armor Holdings caused API to make at least ninety-two payments to the intermediary, totalling approximately $222,750. Meanwhile, with these 2001 and 2003 contracts, together with the 2006 contract extension, Armor Holdings derived gross revenues of approximately $7,121,237, and net profits of approximately $1,552,306.
2007
  • 11 JulArmor Holdings is acquired by BAE Systems, Inc., an indirect wholly owned US subsidiary of Britain’s BAE Systems PLC.

Outcomes

Investigation Outcomes

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2007
  • Bistrong and his co-conspirators’ activities were initially uncovered as the result of internal investigations and audits by Armor Holdings prior to the acquisition by BAE Systems Inc. The company subsequently self-reported to the DOJ. Bistrong began cooperating with federal authorities and participated in an elaborate FBI sting operation whereby he and others pretended to be agents seeking to negotiate corrupt arms deals with African countries. Twenty-two individuals were arrested and charged with corruption-related crimes as a result of the sting. But the sting led to a series of mistrials and acquittals in 2011 and 2012 and all charges were subsequently dropped.
2010
  • 21 JanCriminal information was filed by the US Department of Justice in the US District Court for the District of Columbia, in which the government alleged that Bistrong conspired to make corrupt payments to foreign officials, falsify company books and records, and export controlled goods without authorization.
2011
  • 11 JulIt was revealed that from 2001 through June 2007, AHP had employed a separate accounting practice that disguised in the books and records of Armor Holdings approximately $4,371,278 in commissions paid to intermediaries who brokered the sale of goods to foreign governments.
  • 13 JulThe US Securities and Exchange Commission charges Armor Holdings with Foreign Corrupt Practices Act (FCPA) for violations in connection with sales to the UN.
  • Armor Holdings agreed to a Non Prosecution Agreement (NPA) with the DOJ in 2011, and settled a parallel civil case with the Securities and Exchange Commission (SEC). It paid fines of $5.69 million in disgorgement and $10.29 in criminal fines, totalling $16 million and agreed to maintain strong internal compliance standards. The law enforcement agencies agreed to an NPA because of the company’s self-reporting and the compliance measures it had subsequently taken, including firing Bistrong and other employees involved in the corrupt acts.
2012
  • 31 JulBistrong was sentenced to 18 months in a federal prison camp followed by three years of supervised release. This is despite the prosecutors’ request that he be given a lenient sentence on account of his cooperation in the sting operation.
2013
  • DecBistrong was released from prison after serving fourteen-and-a-half months.
  • He subsequently pursued a career as an anti-corruption blogger, speaker, and consultant, promoting and advising on compliance measures within companies. He talks of how bribery became normalized as a part of his role as an international sales executive. “‘My experience with foreign bribery started early on in my international career,” Bistrong told Corporate Crime Reporter. “I was nodding to conversations where third parties and intermediaries were sharing with me in very colorful and rich language — that involved many words other than the word bribe — that they were paying bribes.” “I moved from nodding to much more later. By the time I was called in by the Justice Department, I was thinking corruptly, I was behaving corruptly and I was acting corruptly.”

References

References

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