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Checking In On Wal-Mart’s FCPA And Compliance-Related Expenses

February 23, 2017

In its recent 4Q FY2017 earnings call presentation Wal-Mart disclosed $17 million in Foreign Corrupt Practices Act and compliance related expenses ($12 million for ongoing investigations and inquiries and $5 million for global compliance program and organizational enhancements). The Q4 expenses of $17 million compare to Q3 expenses of $29 million, Q2 expenses of $28 million and Q1 expenses of $25 million.

Doing the math, Wal-Mart’s 4Q FCPA and compliance-related costs is approximately $275,000 per working day.

Over the past approximate 5 years, I have tracked Wal-Mart’s quarterly disclosed pre-enforcement action professional fees and expenses.

While some pundits have ridiculed me for doing so, it quickly caught on as the popular thing to do.

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The DOJ (And U.K. SFO) Are “Shooting Themselves In The Foot”

February 22, 2017

Both the Department of Justice and the Serious Fraud Office in the U.K. want companies to voluntarily disclose conduct that implicates the Foreign Corrupt Practices Act and/or Bribery Act. Notwithstanding the DOJ slapping a formal title on its policy goal in April 2016 (i.e. the FCPA Pilot Program), this has long been the articulated policy position on both sides of the Atlantic for nearly a decade.

Why then are the DOJ and SFO shooting themselves in the foot by making decisions that should result in any board member, audit committee member, or general counsel informed of current events not making the decision to voluntarily disclose?

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DOJ Deputy Assistant Attorney General McFadden Delivers The FCPA Script

February 21, 2017

One can predict with a high degree of certainty what high-ranking DOJ officials will say about the Foreign Corrupt Practices Act before even hearing or reading the speech (and I say that based on highlighting on these pages over 100 FCPA enforcement agency speeches since 2009).

The script goes like this: the DOJ places a high-priority on FCPA enforcement as well as transparent enforcement; the DOJ is committed not just to corporate enforcement, but holding individuals accountable as well; and companies benefit from voluntary disclosure and cooperation.

New DOJ Deputy Assistant Attorney General Trevor McFadden delivered the script recently in this speech. However, if you want to know how McFadden really feels about DOJ enforcement of the FCPA you might want to review his recent writings on the topic highlighted in this recent post.

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DOJ Highlights 11 Factors Relevant In Evaluating A Corporate Compliance Program

February 20, 2017

Last week the DOJ released this document highlighting 11 factors relevant in evaluating a corporate compliance program.

The factors should be familiar to compliance professionals well-versed on best-practices policies and procedures (whether in the FCPA context or otherwise) and there is really nothing new about the document (indeed the document cites to sources long in the public domain). Yet the document, the origins and purpose of which are not known, was released by a “new” DOJ with new leadership and is thus worthy of highlighting.

Organizing the existing body of best practices in one document is all fine and dandy. The more important question however is what should happen if a business organization acts consistent with the factors but an employee nevertheless exposes the entity to legal liability. Consistent with the FCPA-like laws of many peer countries, this should be relevant as a matter of law and not merely in the opaque, inconsistent, and unpredictable world of DOJ decision making. (See here).

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Hail To The Chief

February 20, 2017

Today is Presidents’ Day.

This post highlights the roles of the Gerald Ford, Jimmy Carter, Ronald Reagan, and William Clinton administrations in enactment and subsequent development of the FCPA.

The article “The Story of the Foreign Corrupt Practices Act” also contains a detailed overview of the roles of the Ford and Carter administrations.

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