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Reboot – Russian Nuclear Industry Bribery Scheme

reboot

Unfortunately in this day and age it is difficult to analyze the news. It seems that approximately 40% of Americans have their preferred news sources which report (and do not report) certain things, approximately 40% of other Americans have their preferred news sources which report (and do not report) certain things, which leaves approximately 20% Americans trying to figure what is actually going on.

For instance, certain media outlets this week (but not others) have devoted substantial coverage of the Obama administration approving “a controversial deal in 2010 giving Moscow control of a large swath of American uranium” [even though] the FBI had gathered substantial evidence that Russian nuclear industry officials were engaged in bribery, kickbacks, extortion and money laundering designed to grow Vladimir Putin’s atomic energy business inside the United States.”

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Friday Roundup

Roundup

Offensive use of the FCPA, a weekend homework assignment, already answered, scrutiny alert, and for the reading stack. It’s all here in the Friday roundup.

Offense Use of the FCPA

FCPA Ripples highlights, among other things, how the FCPA is increasingly being used offensively including in connection with battles for corporate control.

The latest example concerns Elliott Management Corporation’s efforts to unseat board members at Arconic Inc. The recent departure of Arconic’s CEO Klaus Kleinfeld for apparently threatening Elliott Management (an existing Arconic shareholder) was all over the news (see here for example) and this recent Elliott Management letter to Arconic shareholders assails the “poor judgment” of Arconic’s board including the following.

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Across The Pond, Rolls-Royce Also Resolves A $625 Million U.K. Enforcement Action

Rolls

This recent post went in-depth into the $170 million Foreign Corrupt Practices Act enforcement action against Rolls-Royce. As mentioned in the post, the FCPA enforcement action against Rolls-Royce was part of a broader $800 million global resolution that also included a U.K. Serious Fraud Office component as well as Brazil law enforcement action.

The approximate $625 million U.K. enforcement action comprised the bulk of $800 million global resolution (that would seem to make sense, Rolls-Royce is after all a U.K. company) and is summarized below including the several failure to prevent bribery counts under the Bribery Act.

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In Depth Into The $519 Million Teva FCPA Enforcement Action

Copaxone

Records continue to be set as 2016 Foreign Corrupt Practices Act enforcement enters its final days.

Yesterday, the DOJ and SEC announced (here and here) a $519 million enforcement action against Teva Pharmaceutical Industries Ltd. (an Israeli company with American Depository Receipts traded in the U.S.) and a related entity. The settlement amount included a $283 million DOJ component and a related $236 million SEC component.

The action is believed to be the first-ever FCPA enforcement action against an Israeli company and by far the largest-ever FCPA enforcement action against a pharmaceutical company. (The $70 million 2011 enforcement action against Johnson & Johnson is second on that list). You better go ahead and update your top ten list again because the Teva enforcement action is the 4th largest of all-time. (Odebrecht / Braskem held that spot for less than 24 hours and is now bumped to 5th largest FCPA settlement amount of all-time).

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Danish Subsidiary Exposes Analogic To $14.9 Million Enforcement Action

analogic

Yesterday the DOJ and SEC announced (see here and here) a parallel Foreign Corrupt Practices Act enforcement action against medical device manufacturer Analogic Corp. and BK Medical ApS (Analogic’s Danish subsidiary) in which the entities agreed to pay approximately $14.9 million.

The conduct at issue involved alleged improper payments by BK Medical, primarily in Russia through distributors, and the government alleged that BK Medical took various steps to conceal its conduct from Analogic.

The enforcement action involved a DOJ non-prosecution agreement with BK Medical in which the company agreed to pay a $3.4 million criminal penalty and an SEC administrative order against Analogic in which the company agreed to pay approximately $11.5 million in disgorgement and prejudgment interest. In connection with the same administrative order, the SEC also announced that “Lars Frost, BK Medical’s former Chief Financial Officer, agreed to pay a $20,000 civil penalty to settle charges that he knowingly circumvented the internal controls in place at BK Medical and falsified its books and records.

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