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Are FCPA Third-Party “Best Practices” Xenophobic?

question marks2

There is often discussion of “victims” of Foreign Corrupt Practices Act violations. Yet, I genuinely  believe that one of the seldom-discussed “victim” categories of this new era of FCPA enforcement and resulting compliance “best practices” is foreign third parties.

For starters, a business organization can be exposed to FCPA anti-bribery violations based on the conduct of various third parties (assuming the “knowledge” component of the third-party payment provisions is met). Moreover, based on current enforcement theories, the mere “improper” recording of foreign third-party transactions may constitute a books and records violation and the enforcement agencies frequently find internal controls violations based on various alleged deficiencies concerning a business organization’s relationship with foreign third parties.

Because of these legal provisions (and aggressive and dubious enforcement of these provisions), an extensive and elaborate series of “best practices” have developed around pre-engagement, engagement, and post-engagement of foreign third parties.

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Friday Roundup

Roundup

Interesting, more charges, sentenced, Telia-related, scrutiny alert, ISO-37001 related, across the pond, so true, odd, it can work, and for the reading stack. It’s all here in the Friday roundup.

Interesting

According to this Global Investigations Review report based on documents received through the FOIA process, the DOJ approved $711,800 to spend on Hui Chen’s former compliance consultant position over two years. According to the report, Chen’s salary at the DOJ was greater than the DOJ criminal division chief, the deputy attorney general and the attorney general.

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FCPA Flash – A Conversation With Kara Brockmeyer (Former Chief Of The SEC’s FCPA Unit)

FCPA Flash

The FCPA Flash podcast provides in an audio format the same fresh, candid, and informed commentary about the Foreign Corrupt Practices Act and related topics as readers have come to expect from written posts on FCPA Professor.

This FCPA Flash episode is a conversation with Kara Brockmeyer. Earlier this year, Brockmeyer left the SEC where she served as Chief of the SEC’s FCPA Unit since 2011. In the podcast Brockmeyer (currently a partner at Debevoise & Plimpton): looks back at her time as FCPA Unit Chief including what she views as the most significant matters / trends; discusses a few items that, in her view, are not well-understood or appreciated about the SEC’s FCPA enforcement program; explains theories of enforcement regarding the FCPA’s internal controls provisions; and shares insights regarding the SEC’s whistleblower program relevant to the FCPA.

The podcast is a must listen for any FCPA practitioner or compliance professional.

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You Be The Judge

ajudge

The game is baseball is simple. You score more runs than your opponent, you win. Your opponent scores more runs than you, you lose. To score runs, batters have to get on base. A batter gets on base by getting a hit, getting hit by a pitch, or getting walked. The worst possible thing a batter can do is strike out. Striking out represents failure by a batter.

Recently, New York Yankees player Aaron Judge set a Major League Baseball record for batter failure. As highlighted here, over the weekend Judge struck out in his 36th consecutive game breaking the record held by a National League pitcher. (For good measure, Judge also struck out on Sunday pushing the record to 37 consecutive games).

By this metric, Judge is a failure as a batter.

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The Chiquita Enforcement Action – A Bunch Of Bananas With A Slippery Origin

chiquita

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

If you think strict liability enforcement of the FCPA books and records and internal controls provisions is a recent invention, think again.

If you think off-the-rails FCPA enforcement (that is enforcement theories seemingly in conflict with actual legal authority) is a recent invention, think again.

A dubious FCPA enforcement action occurred in 2001 when the SEC announced this administrative cease and desist order finding that Chiquita Brands International Inc. violated the books and records and internal controls provisions of the Foreign Corrupt Practices Act.

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