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An Accounting Fraud Matter With Some FCPA Sprinkled In

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[This post is part of a periodic series regarding “old” FCPA enforcement actions]

Foreign Corrupt Practice Act issues can be the tip of the iceberg with a company and its executives also engaging in other improper conduct. Such was the case in an enforcement action American Bank Note Holographics and its executive Joshua Cantor.

This 2001 criminal information against Joshua Cantor  (during the relevant time period President or Executive Vice President and General Manager of American Bank Note Holographics, Inc. (ABNH), a subsidiary of American Banknote Corporation) is primarily a securities / accounting fraud matter.

However, Cantor was also charged with count of conspiracy to violate the FCPA’s anti-bribery provisions.

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The Impact Of COVID-19 On FCPA Enforcement

questions to ask

Approximately three weeks into the full effects of the COVID-19 crisis, it seems likely that FCPA enforcement in 2020 will be below historical averages. (See here, here and here for historical averages for corporate and individual FCPA enforcement). Depending on the duration of the full effects of the COVID-19 crisis, its impact on FCPA enforcement may carry over into future years as well (recognizing that the life cycle of the FCPA inquiry tends to be approximately 4 years – see here).

Set forth below are some general observations as well as DOJ and SEC responses received to the following question: has COVID-19 had an impact on FCPA investigations and/or enforcement actions.

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This Week On FCPA Professor

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FCPA Professor has been described as “the Wall Street Journal concerning all things FCPA-related,” and “the most authoritative source for those seeking to understand and apply the FCPA.”

Set forth below are the topics discussed this week on FCPA Professor.

Regarding the recent Airbus enforcement action, this post poses the question: if a government enforcement agency makes an allegation in a bribery enforcement action and a risk averse corporation agrees to resolve the enforcement action in the absence of any meaningful judicial scrutiny, does that mean the allegations are true?

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Citgo Employees As Foreign Officials

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In this 2009 post, the issue was raised whether the DOJ’s “foreign official” interpretation would become so broad that employees of Citgo Petroleum (a Delaware corporation with headquarters in Houston) would be considered “foreign officials” under the Foreign Corrupt Practices Act because Citgo is a subsidiary of Petroleos de Venezuela S.A. (PDVSA).

In this little noticed FCPA enforcement from February 2020 against Tulio Anibal Farias-Perez in the sprawling PDVSA related actions, the DOJ did allege this theory of prosecution.

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Corruption Settlements, Coronavirus And The Road Paved With Good Intentions

good intentions

A guest post today from Hughes Hubbard & Reed attorneys Kevin Abikoff and Aline Osorio.

In connection with the 2018 consolidated anti-corruption resolution with Petrobras, the Brazilian prosecutors as part of the settlement with Petrobras sought and obtained approval to allow payment of $682 million from the settlement to benefit education and the environment in Brazil.

On March 19, 2020, the Brazilian prosecutor general applied to the Brazilian Supreme Court to redirect the unspent portion of the settlement funds away from their original destination and instead to be used in the fight against the COVID-19 pandemic in Brazil.

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