A defunct Miami Internet phone company has agreed to pay a US$2 million fine after pleading guilty to paying bribes to officials in Honduras and Yemen in exchange for favorable interconnection rates. Latin Node paid more than $2.2 million in bribes, which company e-mails indicate were intended for, among others, the son of the Yemeni president and officials of the Yemeni Ministry of Telecommunications, court documents show.

Otto Reich, a former deputy in the US State Department, told El Nuevo Herald that Honduran President Manuel Zelaya could possibly be linked to the bribery scheme … ”President Zelaya has allowed or encouraged this kind of practices and we will see that he is also behind this,” said Reich, who now works as an advisor for several US companies.

Manuel Enrique Reina, Zelaya’s private secretary told El Nuevo Herald he would not comment on the plea agreement without reading it. He said Reich has previously made similar comments about Zelaya but that “the President has ignored him.” The scheme was uncovered by Coral Gables-based eLandia International, a publicly traded technology and telecom services firm that acquired an 80% stake in Latin Node for $20 million from Retail Americas VoIP in 2007. Following the purchase, eLandia discovered the questionable payments during a review of internal controls in Latin Node’s finance and accounting departments. The payments were made prior to the stock deal. eLandia conducted an investigation and later notified the Justice Department, the FBI and the Securities & Exchange Commission about the violations, a regulatory filing indicates.

In its sentencing memorandum, the Justice Department noted eLandia’s ”commendable efforts to uncover evidence of corrupt activities.” A Justice Department spokeswoman in Washington said its investigation continues. The interconnection rate is the rate charged by telecom companies to carriers, such as those in other countries, to link to their networks. Interconection charges include costs for delivering calls. Under a plea agreement, Latin Node on Tuesday pleaded guilty to violating the Foreign Corrupt Practices Act (FPCA). The $2 million fine will be paid by eLandia.

Asked why eLandia agreed to pay a fine for wrongful conduct it had nothing to do with, Peter Prieto, the company’s lawyer, wrote in an e-mail: “eLandia agreed to pay the fine because it wanted to put the FPCA problems of its subsidiary, Latin Node, behind it. It was simply time for eLandia to move on.” Latin Node entered a state-court version of bankruptcy in June, more than four months after eLandia decided to dispose of Latin Node’s operations. eLandia wrote off virtually the entire investment. It also reported losing more than $14 million on Latin Node last year. Most of Latin Node’s assets were sold to Miami’s Business Telecommunications Services in July. As Latin Node’s principal creditor, eLandia said it used proceeds from the sale to pay administrative costs.

Meanwhile, eLandia sued Retail Americas VoIP and its president, Jorge Granados, over the Latin Node stock purchase agreement, alleging they committed fraud by not disclosing that Latin Node made illegal payments to foreign officials. Retail Americas and Granados couldn’t be located for comment. Court documents indicate at least five unidentified Latin Node officials were involved in the illegal payments. In February, eLandia said it reached a settlement with Retail Americas and Granados. As part of the deal, 375,000 shares of eLandia stock that were held in escrow as part of the sale agreement were returned to eLandia.