On July 6, 2017, the Ontario Court of Appeal upheld Nazir Karigar’s conviction and three-year prison sentence for agreeing to bribe a foreign public official contrary to the Corruption of Foreign Public Officials Act (CFPOA). Karigar had acted as an agent of Cryptometrics Canada, an Ottawa-area company, in pursuing a contract to supply security screening equipment to Air India. The trial judge determined that Karigar had agreed with other persons to bribe Indian public officials in order to win the contracts and sentenced Karigar to a three-year imprisonment for contravening section 3 of the CFPOA. The trial judge notably did not conclude that Karigar actually paid a bribe.
As highlighted in the article “Grading the DOJ’s FCPA Pilot Program” and this post, it is difficult (if not impossible) to empirically assess whether one of the Pilot Program’s goals (to increase corporate voluntarily disclosures) is actually working. Simply put, many business organizations were voluntarily disclosing prior to the April 2016 Pilot Program and the precise question after the Pilot Program is whether the program is motivating voluntary disclosures to a greater extent than prior to the program.
Yet as highlighted below, it is possible to assess whether another of the DOJ’s stated “main goals” of its Pilot Program is working and at present the undeniable answer is that, as measured against this “main goal,” the Pilot Program is currently failing.
There was really nothing new in the Yates Memo as it continued the DOJ’s rhetoric about the importance of individual prosecutions. Specifically, the Yates Memo repeated the following DOJ rhetoric:
“One of the most effective ways to combat corporate misconduct is by seeking accountability from the individuals who perpetrated the wrongdoing. Such accountability is important for several reasons: it deters future illegal activity, it incentivizes changes in corporate behavior, it ensures that the proper parties are held responsible for their actions, and it promotes the public’s confidence in our justice system.”
Some FCPA commentators are either lacking in historical perspective or just spinning narratives to fit their beliefs.
Either one is troubling and from time-to-time someone in the FCPA space has to call a time-out.
This recent post from Matt Kelly who runs a site called Radical Compliance takes issue with the two DOJ corporate FCPA enforcement announced thus far in the Trump administration. Nothing wrong with this as FCPA Professor covered the Linde Gas and CDM Smith “declination with disgorgement” enforcement actions as well (see here, here, here and here for prior posts). And to be sure, I’ve criticized these form of FCPA resolution vehicles invented by the Obama DOJ (see here) as well as non-prosecution agreements used by the Obama DOJ to resolve alleged instances of corporate FCPA liability. In fact, I’ve long argued that NPAs (and DPAs) should be abolished in the FCPA context.
In this recent podcast, former DOJ contract consulting expert Hui Chen says that her first draft of the February 2017 “Evaluation of Corporate Compliance Programs” policy document was dated January 21, 2016 but the Obama DOJ never publicly released the document. She also says that DOJ prosecutors don’t even read the compliance regulations they are subject to.
From my perspective, the rest of the extensive – often over-the-top and often misleading – media coverage concerning Chen leaving her contract consulting expert position at the DOJ (which she began during the Obama administration) because she has strong opinions about the Trump administration and in her words “I want to help elect candidates who stand for [values she shares], and [she] cannot do that while under contract with the Criminal Division due to Hatch Act restrictions” is a non-story.