My first reaction was “huh?!” Apparently according to Women’s Wear Daily, Dooney and Bourke’s chairman as well as co-founder Frederic Bourke was sentenced to federal prison for a year and a day. His crime? He violated the Foreign Correct Practices Act and Travel Act.
How you ask did he do such a thing? Bourke invested about $8 million in a company called Oily Rock Group Ltd. This company was recently attempted to become privatized when the Azerbaijani State purchased the private vouchers from the public. This wouldn’t have been a problem if there weren’t rumors saying that the company had paid millions of dollars in bribes to the government officials in order to make sure that their holdings would end up being privatized. Because of the rumors floating around, the oil company never got privatized.
What happens now? On top of losing his investment in the company, Bourke was sentenced to prison; however, the court has given him a $10 million bail, pending on his appeal on the verdict. I guess money can buy you some freedom, or at least some good lawyers that can convince the judge to give it to you.
This doesn’t affect me in buying future Dooney and Bourke handbags, but I definitely won’t be buying their stocks. What’s your take on the situation?
