Chapter Nine – Derick’s Bribery Charge

Professor Bruce Zucker invited me to speak to his business law classes at California State University in Northridge. My memories of studying business law were that the course introduced us to such concepts as the necessary elements of a contract, corporate structures, laws governing employment, and so forth. I intended to enlighten the Cal-State Northridge students on more practical dilemmas they may face once they entered the workforce. My presentation would focus on consequences that could follow personal failure.

The type of failure I wanted to describe wasn’t the type they were used to hearing about. Rather than discussing poor job performance or professional errors, I wanted to speak openly about how people who considered themselves good citizens were seduced by abandoning ethical principles. I understood that Professor Zucker’s students worked hard to earn credentials that would lead to fulfilling careers and that they looked forward to joining the workforce as promising professionals. They couldn’t contemplate themselves engaging in theft or participating in the types of “street crime” that led local news broadcasts every day. But what about more esoteric crimes? I stood before them to talk about the pressures and the rationalizations that would come to them, as their professional responsibilities—or capacities—increased.

I’ve heard some people define an individual’s ethics by the way a person acted when others weren’t watching. Many professionals worked with levels of discretion that kept their decisions and the reasons for making their decisions private. When I was a stockbroker, for example, overseeing hundreds of millions of dollars in client assets at UBS, no one would question how I executed trades. I didn’t always act transparently, especially when opportunities opened that would line my pockets with extra income. Since no one would know other than the individual who made the underhanded payment to me, I didn’t consider the payment anyone else’s business. In reality, my actions in accepting the “kickback” violated ethical codes, and quite frankly, accepting kickbacks may have violated some laws as well. I shrugged off such concerns, ignoring inherent conflicts that were at the root of my decisions with rationalizations that I was doing my job and that no one was being hurt.

With a barrage of news reports describing the paucity of ethics within the culture of Wall Street, my admission of accepting kickbacks didn’t surprise any of the bright students in Professor Zucker’s class. I stood ready and willing to respond to their questions about my motivations, but the real teachable moment didn’t come from my experiences. Instead, I got the students to listen when I told them about my conversations with Derick. Whereas graft within the stockbroker community wasn’t so shocking, Derick’s background of service to our country suggested that he would have honed a more reliable moral compass. In sharing what I learned from Derick, I shared how anyone who disregarded the importance of making values-based decisions could become susceptible to temptations that could destroy a lifelong pursuit of honor, integrity, and reputation.

Derick grew up in Nevada with aspirations of becoming a soldier. His cousin served in the Air Force and regaled him with exciting stories about traveling the world, about training experiences, about the camaraderie. After graduating high school, Derick enlisted with hopes of maturing and preparing himself for life’s challenges.

He completed boot camp in Kelly Air Force Base, Texas, then continued training to become a supply and services specialist. Derick’s hard work and grasp of logistics led to his assignment in a squadron at Travis Air Force Base, in Northern California. Later, Derick transferred to a coveted spot at the base in Aviano, Italy. Through hard work, discipline, and study, he rapidly advanced his rank from airman to sergeant.

Derick’s tour of Italy concluded about the same time as his initial three-year commitment to the Air Force, but Derick said that he found personal value in all that the military stood for so he reenlisted for another six years. The reenlistment brought him to Charleston Air Force Base in South Carolina, where he became a part of the supply and services squadron. Wanting to advance further with the military, Derick completed his college degree and received training in logistics while on a one-year tour in Korea. He then returned to Aviano where leadership training and discipline led to his further advancement in rank to staff sergeant and eventually to Master Chief.

As a logistician, Derick’s responsibilities required him to coordinate supply lines for troops in various parts of the world. Thousands of soldiers depended upon his judgment and his ability to anticipate the unexpected. In addition to becoming fluent with various computer application systems, Derick understood that his primary asset was his network of contacts. The job required him to build trust in relationships, as through trust he could expand both his sphere of influence as well as perform his duties with more efficiency.

Derick’s identity became wrapped up with his need to build a reputation as a man who served his country with honor. To that end, when his second enlistment expired, Derick applied to officer training school and he was accepted. He agreed to continue his career with the Air Force for another 10 years and graduated with the rank of second lieutenant. After a few years, Derick’s responsibilities increased to the point where he was promoted to Major where he oversaw supply lines to American military troops throughout the entire Middle East.

Derick’s duty of ensuring that supplies and munitions flowed despite continuous threat of attack by enemy forces required him to employ creativity and ingenuity on a grand scale. Despite an abundance of classroom and theoretical training, Derick worked in a war zone. His superior expected him to use discretion, to cultivate contacts, to find ways to complete his job by whatever means were necessary. As an officer, Derick was a professional with influence over billions of dollars worth of supplies every month. I met Derick just after he pleaded guilty to bribery charges that resulted in an 18-month sentence. He was about to self-surrender to federal prison.

“So how long in total did you serve in the Air Force,” I asked.

“I completed 25 years, but I was expecting to serve another 10 years. The military was my life.”

“Can you tell me about the pressures that led to your crime?”

Since Derick had pleaded guilty, I suggested that he might derive some therapeutic value in talking about his decisions. We spoke at a Starbucks in Los Angeles. While sipping coffee, Derick looked down at the table, his buzz cut as precise as his military bearing. “I hope you don’t feel ashamed,” I ventured. “We’re all human beings and we all have made decisions that we wish we could take back. I certainly have. The answer—for me at least—has been acknowledging my weaknesses and committing myself to do better.”

“A war zone is a crazy place.” Derick began. “But that’s not a valid excuse for the decisions I made. I’m not some gullible kid, green to the ways of the world. I just got sucked in,” he shook his head slowly, then took a sip from his mug, “doing things I knew that I shouldn’t be doing.”

“You said that you pleaded guilty to bribery. How did it start?”

“It started with curiosity,” Derick said. “Wasn’t it curiosity that killed the cat? The curiosity led to temptations. Just a gradual slide. Then I was in, caught in the trap of corruption that I had trained all my life to avoid. I just lost my way.”

“How? What started it?”

“My job was to ensure that troops received the supplies they needed. Without supplies they couldn’t accomplish their mission. But in the theatre of war, getting supplies to remote locations wasn’t as easy as driving to the local Wal-Mart. We had to navigate around land mines, sniper fire, suicide bombers, and unexpected disasters. Improvised explosive devices could strike at any given moment, but none of that would interfere with the continuous need for supplies. My job was to fulfill the mission regardless of the threats, and as an officer that responsibility required me to understand both the terrain and the locals who had influence over the terrain.”

Derick explained to me how his position as an officer with responsibilities across the entire theatre of operations brought him to the attention of enterprising businessmen who controlled companies selling billions of dollars worth of goods and services to the Air Force.

“It all began subtly,” he said, “with an invitation to dinner. I knew that I was being courted but I’m a poker player. I was curious to see how the hand would play out and I accepted.”

“Were you invited by an American or someone from the Middle East?”

“My initial contact was with a Saudi who was part of the royal family. His company distributed cleaning supplies and other products across the region. We met for dinner the first time in a palatial home he kept in Iraq. I felt totally out of place.”

“Why? Was it a large gathering?”

“Not large. Just him, five exquisitely beautiful young women, and me. The setting was ostentatious, with butlers and servants. I was a meat and potatoes guy who didn’t fit in with the perfumed atmosphere, the formality. But the host was gracious, a real charmer and I was intrigued, like a kid flipping through the pages of his first Playboy.

“Did he make you an offer of some kind?”

“Oh, no,” Derick chuckled. “These were high stakes and my host wasn’t new to the game. He was a roller, a player. All he was doing was laying it all out for me to see, showing the perks that could come with his friendship. The man showed real interest in my background. When I told him that I had grown up in Nevada, he told me about a house he owned in Lake Tahoe and promised an invitation the next time he was in the U.S.

“Did you discuss any business at all?”

“Not that first night. We just enjoyed dinner, got to know one another a little bit.”

“Then there wasn’t any violation of law, right?”

Derick explained to me the intricacies of law. He was an officer in the United States Air Force. Under Title 18 of the U.S. Criminal Code, Section 302, that title distinguished him as a public official. Accordingly, special laws (having to do with Chapter 11 of the Title 18 criminal code) applied to Derick, especially those concerning bribery, graft, and conflicts of interest.

“I wouldn’t say that there wasn’t any violation. I mean, I understood that as an officer I had discretion and influence over billions of dollars in goods and services. My mind was supposed to focus exclusively on the needs of our troops. Those of us who had such positions were required to abide by strict rules that would put a cap on the value of services or goods or gifts we received. My meeting with the prince may have begun with a dinner at his home, but I shouldn’t have been there. I regret that I didn’t follow military protocol and refrain from socializing with someone who wanted to curry favor with me. The rules governing conflicts of interest existed for a reason. I knew what I was getting into—I’m not stupid—and the dinner made me want to walk a little closer to the fire, to see how he would court me.”

“Okay. So you left the dinner without discussing any business. What happened next?”

“I left the dinner with an invitation to another event and of course my curiosity compelled me to accept.”

“Did he invite you back to his house?”

“Not the second time,” Derick said. “He invited me to a gathering that he hosted in a luxury hotel. When I walked in I met seven or eight other Middle Eastern businessmen, all sheiks or members of the royal family who owned businesses that supplied the military. Some wore the flashy robes with headwear, others were in tailored suits. The ratio of striking young women to men must have been three to one. The women may have mingled with grace and elegance but my host assured me that they were there to please me. He said that the adjoining suite belonged to me for the weekend and that I should enjoy it.”

“Any business discussed,” I asked.

“Nope. Purely social. Again, he was laying out the spread, showing the vastness and influence of his wealth. Before he introduced me to the other businessmen at the gathering, he extolled their importance, telling me how much they controlled and how each of them was enthusiastic about meeting an American officer. I could see what was going on, and that meeting clearly crossed lines. I wasn’t having dinner with a ‘friend’ in his home. I was in a hotel, allowing foreigners to wine and dine me despite my duty of overseeing contractual performance of their businesses with the United States. I didn’t have an excuse. I knew that I was crossing a line but I was intrigued with the illusion of power.”

“Besides that,” I pointed out, “you probably weren’t so eager to turn down the offer of a prepaid hotel suite that you could share with an attractive young woman.”

“Humph,” Derick snorted. “Or three young women! But the truth was that I shouldn’t have gone to that party in the first place. I knew better. I could lie to myself all day that I wasn’t doing anything wrong. In fact, I tried to justify my acceptance of the invitation in my mind with my responsibilities of nurturing local contracts which would help me keep supply lines open. As I look back now, I know those were only excuses.”

“What about the rules of that country,” I asked. “I mean, you were in Iraq, not the United States. Were there any laws in those countries about the exchange of gifts in the course of government business?”

“I wasn’t only in Iraq,” Derick pointed out. “Like I said, my responsibilities covered the entire theatre of operations—wherever we had military personnel in the region. I was in Iraq, Afghanistan, Kuwait, all the way to the horn of Africa. The laws of those countries weren’t supposed to govern my conduct. I was an officer in the United States Air Force. My allegiance was to the U.S. and I was supposed to act honorably. I knew that. Like I said, the power just sucked me in.”

“Well, did the prince expect you to reciprocate for all the attention he was lavishing on you? Did there come a time when he made an actual bribe?”

“Every week he invited me to one event or another, always peppering the event with seductive women. If we didn’t get together he would arrange something else, like a hotel suite for me to use. Two or three months of this dance continued before he asked me to reciprocate. By the time he did, I was thoroughly corrupted and ready to comply.”

“What happened?”

“I was in Kuwait when he invited me to a meeting in an office he kept there. After some smooth praise about how my reputation for honesty and character was well known throughout the region, and how he would not consider offending me, he handed me a stack of ten requests for proposals. ‘Would you do me a favor of looking through there, he asked? I’d like your opinion.’ That was the moment of truth.”

“Why? What was so different?”

“Well, he wasn’t simply entertaining me with women and wine. I looked through a few of the documents and I knew exactly what he was asking. Those RFPs represented contracts that, as an officer, I would oversee. For me to discuss any aspect of them with a potential bidder was tantamount to official corruption, and I knew it.”

“So what did you say?”

“I just flipped through a few of the pages, then set them back down on the table. I told him I would have to think about it, that I couldn’t make a decision right then. We both understood the gravity of what he was asking me to do. He was very calm, told me of course he understood that I was a man of decency and that he respected me, that I should take time to think. I also emphasized that my position didn’t authorize me to decide who would receive the contract. My job, I explained, was to ensure the supplies arrived to the troops on time. He knew all of that. He made clear that he knew the protocol. He named my superiors, the officers who would issue the contract. All he hoped that I could provide, however, was a recommendation to assure anyone who might ask that his company provided excellent service.”

“What was the value of the contracts that he was after,” I asked.

“There were 10 RFPs,” Derick said. The smallest was in the $50 million range; the largest was more than $500 million. He handed me a steel attaché case before I left his office, telling me it was a small token of gratitude to show his appreciation. I shouldn’t have considered it. But I paused, looked at it. He watched me. I opened the case. There were ten stacks, all hundreds, new crisp bills. The paper bands holding the stacks together indicated each was worth $10,000. I think they must have been perfumed because they sure smelled sweet,” Derick laughed. “I should have pushed the case away. Instead, I walked out from that office on shaky legs, but with the briefcase firmly in my grip.”

Derick sat across from me describing the disgust he felt with himself for having accepted the funds. Although he lacked the power to decide who would receive contracts, when his host named all of Derick’s superiors, the chain of command, and the complete internal procedures, it was clear that groundwork was being laid. The contractors shouldn’t have even had access to the RFPs. Others were involved with this methodical plan of corruption, and Derick was being paid to provide cover. With billions of dollars funding the war, Derick said he had reason to believe the corruption originated at the highest levels of our government. Still, he expressed shame for having sold the honor and reputation he had devoted a lifetime to building.

In the end, the decisions Derick made would affect more than his conscience. His tour of duty in the Middle East concluded with his reassignment to the United States. Despite being stationed outside the theatre of war, considerations from the government contractors continued to flow his way.

Derick was returning home from an all-expense paid ski trip in the Rockies. He and his three guests had enjoyed the trip. But the good times cooled when Derick fielded a phone call from an officer with the military’s criminal investigation division. Officials in Iraq had intercepted a suitcase filled with currency that another officer was sending home. When officials interrogated that officer, he confessed to his participation in contract manipulations. The admission gave the criminal investigators a new thread to follow, and the thread led to Derick. He pleaded guilty to bribery charges.

“Listen Justin,” Derick told me, “I didn’t contact you because I needed help in preparing for 18 months of imprisonment. I’ve been in combat, driven through roads littered with land mines. Prison doesn’t mean anything to me, whether I’m locked alone in a concrete bunker or sent to one of those white-collar camps. I called to talk with you about the real punishment, and that’s the continuous assault on my conscience. I don’t know how to put this episode behind me. I don’t have a wife or children. Reputation was what I lived for, and that’s gone—dishonored. How’s a guy supposed to cope with that?”

Derick lived for honor and reputation—devoted his life to such virtues—yet even he succumbed to the same type of temptations that brought down so many people who never expected such falls. I may not have had a military career, but I could identify with the self-loathing that followed the realization and acceptance of my wrongdoing. What Derick didn’t understand was the acceptance and a desire to do better was the essential beginning of the healing process. In response to Derick’s question I described the daily exercises and commitments I made to live an ethical life.

“But is that going to be enough?” he asked. “Do you think that I’ll ever put this behind me?”

“The truth is,” I told Derick, “I work at it every day. I write about my crime; I speak about my crime; I talk about my crime. All of those activities represent a part of my continuing journey to become a better man. I don’t know whether we ever put our bad decisions behind us, but I know that by considering them, owning them, and learning from them, we can work toward redeeming ourselves, toward finding peace.”

When I met with Derick, I had been home from prison for a year. Despite the efforts to reconcile with society and with my conscience, I struggled for a time coping with some of the realties that come with having a felony conviction. Whenever I would meet new people on social occasions (especially women), I felt awkward divulging that I had been in prison. That changed after I met the basketball legend, Kareem Abdul Jabbar. Kareem was a friend of my father, Bernie. The three of us had dinner one night together and I told my story. Kareem listened. Then he told me about a lesson he had learned from Coach John Wooden when he was playing at UCLA. “Any man can make a bad decision,” Kareem said, “regardless of his status in life, but what makes a man great is when he recognized his wrongs, then worked to become better.”

Kareem looked at me directly and nodded. Then he reached his hand across the table to shake mine. With a firm grip, he said, “welcome home. You have made your father very proud by the way you’ve accepted responsibility and by working to become better, and I want you to know that I respect you.” My father had tears in his eyes, and at that moment, seeing that I had made my father proud, I found new strength. It was a special moment for me, a turning point, the type that I assured Derick he would experience by working to become better every day.

Chapter Nine Questions

  1. How does an individual’s response to temptation change with an increase in authority or discretion?
  2. What should guide an individual’s decisions when laws and customs from one country where one does business differ from those of the U.S.?
  3. What exercises can organizations offer to encourage individuals to work toward becoming better every day?