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A Christmas Classic

Christmas Star

A Christmas classic from James McGrath, a valued colleague in the FCPA space with a candid wit, who passed away in 2014. The below post originally appeared on McGrath’s Internal Investigations Blog on December 24, 2012.

*****

The allegations being investigated surround gifts being given by individual businessmen to the family of an Israeli government official a number of years ago.  These businessmen – a Mr. Balthasar, a Mr. Gaspar, and a Mr. Melchior – supposedly provided a family in the royal line of King David with significant gifts, including gold, frankincense, and myrrh, in return for favorable consideration of an as-yet undetermined project in the Middle East.

The three men are believed to be third-party intermediaries for a multitude of Christian church organizations within the United States, and any jurisdictional nexus would seem to be predicated upon such a fact, if verified.

Whether any member of the family that received the gifts was or is a “government official” – as that term has come to be expansively defined by the DOJ – is unverified, but nonetheless likely.  While Transparency International’s Corruption Perceptions Index does not reference them in any of its yearly rosters, there is a large volume of other source material that seemingly establishes one or more of them as being related to the ruling family in Israel.

Regardless of the strength of the government’s case in these regards, there is still the hurdle presented by the age of the alleged violations.  They are reported to have occurred approximately 2,012 years ago.  The DOJ could be expected to assert that the clock did not begin to run until the government recently became aware of Balthazar’s, Gaspar’s, and Melchior’s conduct, however, there appears to be a strong argument that voluntary self-disclosure was made some time ago, thus commencing the running – and expiration – of the statutory period.

This line of inquiry will continue in multiple, parallel investigations.

Begin 2016 By Elevating Your FCPA Knowledge At The FCPA Institute – Miami

Featured Image FCPA Institute

Begin 2016 by elevating your Foreign Corrupt Practices Act knowledge and practical skills in Miami, Florida at the FCPA Institute on January 14th – 15th.  The FCPA Institute – Miami also provides participants the opportunity to earn CLE credit as well as a value-added professional credential.

The FCPA Institute is different from other FCPA conferences as information is presented in an integrated and cohesive manner by an expert instructor with FCPA practice and teaching experience.  Moreover, the FCPA Institute promotes active learning by participants through issue-spotting video exercises, skills exercises, small-group discussions, and the sharing of real-world practices and experiences.

To best facilitate the unique learning experience that the FCPA Institute represents, attendance at each FCPA Institute is capped at 30 participants and registrants for the FCPA Institute – Miami already include compliance professionals from leading companies and leading firms from around the world.

Click here to learn more about the FCPA Institute and to register for the Miami event.

At the end of the FCPA Institute, participants can elect to have their knowledge assessed and can earn a certificate of completion upon passing a written assessment tool.  In this way, successful completion of the FCPA Institute represents a value-added credential for professional development. In addition, attorneys who complete the FCPA Institute may be eligible to receive Continuing Legal Education (“CLE”) credits. The FCPA Institute – Miami will be applying for CLE credit and approval is pending in New York and California.  FCPA Institute participants seeking CLE in other states will receive a Uniform Certificate of Attendance that can be used for attorney self-submission in other states. Moreover, previous FCPA Institute participants have successfully obtained continuing education units from the Society of Corporate Compliance and Ethics for attending the FCPA Institute.

Leading law firms and companies across a variety of industry sectors have chosen the FCPA Institute to elevate the FCPA knowledge and practical skills of their employees.

Institute LogosRepresentatives from the organizations at left have attended the FCPA Institute and set forth below is a sampling of what FCPA Institute “graduates” have said about their experience.

*****

“Unlike other FCPA conferences where one leaves with a spinning head and unanswered questions, I left the FCPA Institute with a firm understanding of the nuts and bolts of the FCPA, the ability to spot issues, and knowledge of where resources can be found that offer guidance in resolving an issue.  The limited class size of the FCPA Institute ensured that all questions were answered and the interactive discussion among other compliance professionals was fantastic.” (Rob Foster, In-House Counsel, Oil and Gas Company)

“The FCPA Institute was one of the best professional development investments of time and money that I have made since law school. The combination of black letter law and practical insight was invaluable. I would highly recommend the FCPA Institute to any professional who has compliance, ethics, legal or international business responsibilities.” (Norm Keith, Partner, Fasken Martineau, Toronto).

“The FCPA Institute is very different than other FCPA conferences I have attended.  It was interactive, engaging, thought-provoking and at the completion of the Institute I left feeling like I had really learned something new and useful for my job.  The FCPA Institute is a must-attend for all compliance folks (in-house or external).” (Robert Wieck, CPA, CIA, CFE, Forensic Audit Senior Manager, Oracle Corporation)

The FCPA Institute is a top-flight conference that offers an insightful, comprehensive review of the FCPA enforcement landscape.  Professor Koehler’s focus on developing practical skills in an intimate setting really sets it apart from other FCPA conferences.  One of the best features of the FCPA Institute is its diversity of participants and the ability to learn alongside in-house counsel, company executives and finance professionals. (Blair Albom, Associate, Debevoise & Plimpton)

“The FCPA Institute was a professionally enriching experience and substantially increased my understanding of the FCPA and its enforcement. Professor Koehler’s extensive insight and practical experience lends a unique view to analyzing enforcement actions and learning compliance best practices. I highly recommend the FCPA Institute to practitioners from all career stages.” (Sherbir Panag, MZM Legal, Mumbia, India)

“The FCPA Institute provided an in-depth look into the various forces that have shaped, and that are shaping, FCPA enforcement.  The diverse group of participants provided unique insight into how, at a practical level, various professionals evaluate risk and deal with FCPA issues on a day-to-day basis.  The small group setting, the interactive nature of the event, and the skills assessment test all set the FCPA Institute apart from other FCPA conferences or panel-based events.” (John Turlais, Senior Counsel, Foley & Lardner)

Begin 2016 By Elevating Your FCPA Knowledge At The FCPA Institute – Miami

Featured Image FCPA Institute

Begin 2016 by elevating your Foreign Corrupt Practices Act knowledge and practical skills in Miami, Florida at the FCPA Institute on January 14th – 15th.  The FCPA Institute – Miami also provides participants the opportunity to earn CLE credit as well as a value-added professional credential.

The FCPA Institute is different from other FCPA conferences as information is presented in an integrated and cohesive manner by an expert instructor with FCPA practice and teaching experience.  Moreover, the FCPA Institute promotes active learning by participants through issue-spotting video exercises, skills exercises, small-group discussions, and the sharing of real-world practices and experiences.

To best facilitate the unique learning experience that the FCPA Institute represents, attendance at each FCPA Institute is capped at 30 participants and registrants for the FCPA Institute – Miami already include compliance professionals from leading companies and leading firms from around the world.

Click here to learn more about the FCPA Institute and to register for the Miami event.

At the end of the FCPA Institute, participants can elect to have their knowledge assessed and can earn a certificate of completion upon passing a written assessment tool.  In this way, successful completion of the FCPA Institute represents a value-added credential for professional development. In addition, attorneys who complete the FCPA Institute may be eligible to receive Continuing Legal Education (“CLE”) credits. The FCPA Institute – Miami will be applying for CLE credit and approval is pending in New York and California.  FCPA Institute participants seeking CLE in other states will receive a Uniform Certificate of Attendance that can be used for attorney self-submission in other states. Moreover, previous FCPA Institute participants have successfully obtained continuing education units from the Society of Corporate Compliance and Ethics for attending the FCPA Institute.

Institute LogosLeading law firms and companies across a variety of industry sectors have chosen the FCPA Institute to elevate the FCPA knowledge and practical skills of their employees.

Representatives from the organizations at left have attended the FCPA Institute and set forth below is a sampling of what FCPA Institute “graduates” have said about their experience.

*****

“Unlike other FCPA conferences where one leaves with a spinning head and unanswered questions, I left the FCPA Institute with a firm understanding of the nuts and bolts of the FCPA, the ability to spot issues, and knowledge of where resources can be found that offer guidance in resolving an issue.  The limited class size of the FCPA Institute ensured that all questions were answered and the interactive discussion among other compliance professionals was fantastic.” (Rob Foster, In-House Counsel, Oil and Gas Company)

“The FCPA Institute was one of the best professional development investments of time and money that I have made since law school. The combination of black letter law and practical insight was invaluable. I would highly recommend the FCPA Institute to any professional who has compliance, ethics, legal or international business responsibilities.” (Norm Keith, Partner, Fasken Martineau, Toronto).

“The FCPA Institute is very different than other FCPA conferences I have attended.  It was interactive, engaging, thought-provoking and at the completion of the Institute I left feeling like I had really learned something new and useful for my job.  The FCPA Institute is a must-attend for all compliance folks (in-house or external).” (Robert Wieck, CPA, CIA, CFE, Forensic Audit Senior Manager, Oracle Corporation)

The FCPA Institute is a top-flight conference that offers an insightful, comprehensive review of the FCPA enforcement landscape.  Professor Koehler’s focus on developing practical skills in an intimate setting really sets it apart from other FCPA conferences.  One of the best features of the FCPA Institute is its diversity of participants and the ability to learn alongside in-house counsel, company executives and finance professionals. (Blair Albom, Associate, Debevoise & Plimpton)

“The FCPA Institute was a professionally enriching experience and substantially increased my understanding of the FCPA and its enforcement. Professor Koehler’s extensive insight and practical experience lends a unique view to analyzing enforcement actions and learning compliance best practices. I highly recommend the FCPA Institute to practitioners from all career stages.” (Sherbir Panag, MZM Legal, Mumbia, India)

“The FCPA Institute provided an in-depth look into the various forces that have shaped, and that are shaping, FCPA enforcement.  The diverse group of participants provided unique insight into how, at a practical level, various professionals evaluate risk and deal with FCPA issues on a day-to-day basis.  The small group setting, the interactive nature of the event, and the skills assessment test all set the FCPA Institute apart from other FCPA conferences or panel-based events.” (John Turlais, Senior Counsel, Foley & Lardner)

The FCPA’s New Era of Enforcement Turns 5

5years

Five years ago, on November 16, 2010, then DOJ Assistant Attorney General Lanny Breuer stated before an FCPA audience “we are in a new era of FCPA enforcement; and we are here to stay.”

As noted in this post five years ago today, it was never clear why a new era of FCPA enforcement was being declared.

After all, the FCPA had not changed one word since 1998. However, with creeping frequency the enforcement theories leading up to the declaration of the FCPA’s new era had most certainly changed, as had the way in which the DOJ (and SEC) began resolving FCPA enforcement actions.

Since that day five years ago, I have written on a near-daily basis about various aspect of this new era of FCPA enforcement. Indeed, “The FCPA in a New Era” was the title of my 2014 book.  (Click here to learn more about the book and see what others have said about “The FCPA in a New Era.”).

Much has happened during the past five years, but then again much has not changed and there remain serious and good faith questions about the FCPA and how the DOJ and SEC enforce the FCPA.

To better understand the many FCPA and related developments during the past five years, you may want to review the following year in review articles.

  • For 2010, see here
  • For 2011, see here
  • For 2012, see here
  • For 2013, see here
  • For 2014, see here

From my perch, the five most significant trends during the past five years are the following.

  • The wide gap between corporate FCPA enforcement and related individual enforcement actions.  The DOJ and SEC have long recognized that corporate enforcement only does not achieve maximum deterrence. Yet, as highlighted in this prior post, during the past 5+ years, approximately 75% of corporate DOJ FCPA enforcement actions have not resulted in any related enforcement action against a company employee and approximately 80% of corporate SEC FCPA enforcement actions have not resulted in any related enforcement action against a company employee. Instead of asking the “but why was nobody charged question,” as I stated in my 2010 Senate testimony the more appropriate question is do corporate FCPA enforcement actions necessarily represent provable FCPA violations?
  • In answering the above question, it is important to understand how the DOJ and SEC have come to resolve corporate enforcement actions in this new era of enforcement. NPAs and DPAs have dominated DOJ FCPA enforcement during the past five years as approximately 85% of corporate FCPA actions involved in whole or in part an NPA or DPA. The common thread in these resolution vehicles is the absence (or practical) absence of judicial scrutiny.  In this new era of FCPA enforcement, the SEC also began using NPAs and DPAs, but with the SEC the bigger story has been the SEC’s frequent use of administrative orders to resolve corporate FCPA enforcement actions. Indeed, in 2014 approximately 85% of SEC corporate enforcement actions were resolved administratively in the absence of any judicial scrutiny.
  • As predicated in my 2010 article, “The Facade of FCPA Enforcement,” other nations would soon grow envious of the ease in which the U.S. government resolved FCPA enforcement actions and the ease in which settlement amounts flowed into the U.S. treasury. Thus, it was predicted that other nations would soon start modeling their enforcement of FCPA-like laws on the U.S. alternative resolution model. Sure enough, the U.K. formally adopted (but has not yet used) DPAs to resolve Bribery Act offenses, Canada wants alternative resolution vehicles, Australia wants alternative resolution vehicles and the list goes on and on. This is why, among other reasons, the way in which the U.S. government resolves FCPA enforcement actions matters.
  • The 11th Circuit’s 2014 decision in Esquenazi notwithstanding, the DOJ has a very poor record in this new era of FCPA enforcement when actually put to its burden of proof.  The Africa Sting debacle, the Lindsey Manufacturing et al prosecutorial misconduct debacle, the O’Shea loss (to read more about these instances – see “What Percentage of DOJ FCPA Losses is Acceptable?“)  the Sigelman debacle, and the SEC caving in and offering a very lenient settlement to Jackson and Ruehlen on the eve of trial, all of these instances represent the government having a serious problem proving FCPA violations when put to its burden of proof. Yet despite these struggles, the DOJ and SEC consistently tout their successful FCPA enforcement program by exercising leverage against risk averse business organizations. In short, during this era of FCPA enforcement, the DOJ and SEC have elevated quantity over quality.
  • During this new era, FCPA enforcement became a top priority for the U.S. government, and government enforcement officials have stated that “we in the United States are in a unique position to spread the gospel of anti-corruption” and that FCPA enforcement ensures not only that the United States “is on the right side of history, but also that it has a hand in advancing that history. However, this lofty rhetoric, besides being breathless, is largely hollow as the U.S. crusade against bribery suffers from uncomfortable truths and double standards and you can decide for yourself whether the U.S. “practices what it preaches” when it comes to the enforcement of bribery laws and whether the United States is indeed “in a unique position to spread the gospel of anti-corruption” by reading this recently published article.

As the FCPA’s new era turns 5, it is important to recognize that the notion of zero corruption (a position explicitly or at least implicitly advanced by some) is simply foolish for the same reason it is foolish to suggest that other crimes will be eliminated.

Rather, the goal of FCPA enforcement should be to minimize FCPA violations and to create policies and procedures that best yield this goal.

Unfortunately, the policies and procedures advanced by the DOJ and SEC since 2010 have not been successful and recent events such as the Yates Memo (yet another DOJ policy memo) and additional rumored FCPA guidance would seem to indicate.

What will the next five years of FCPA enforcement look like?

I have my guesses, but regardless of the answer, you can be sure that every FCPA enforcement action and every FCPA or related development will be highlighted and analyzed right here on FCPA Professor just like the past five years.

Registration Opens For The FCPA Institute – Miami (Jan. 14-15, 2016)

Featured Image FCPA Institute

Since its launch in July 2014, the FCPA Institute has elevated the substantive knowledge and practical skills of lawyers, accountants, compliance professionals and business executives from around the world.

After successful events in Milwaukee (July 2014), Miami (January 2015), Houston (May 2015), and Washington, D.C. (August 2015), the FCPA Institute is next making another stop in Miami on January 14-15, 2016 and will be hosted by Hogan Lovells.

The FCPA Institute is different from other FCPA conferences as information is presented in an integrated and cohesive manner by an expert instructor with FCPA practice and teaching experience.  Moreover, the FCPA Institute promotes active learning by participants through issue-spotting video exercises, skills exercises, small-group discussions, and the sharing of real-world practices and experiences.

To best facilitate the unique learning experience that the FCPA Institute represents, attendance at each FCPA Institute is capped at 30 participants. Click here to learn more about the FCPA Institute and to register for the Miami event.

At the end of the FCPA Institute, participants can elect to have their knowledge assessed and can earn a certificate of completion upon passing a written assessment tool.  In this way, successful completion of the FCPA Institute represents a value-added credential for professional development. In addition, attorneys who complete the FCPA Institute may be eligible to receive Continuing Legal Education (“CLE”) credits.

Institute LogosLeading law firms and companies across a variety of industry sectors have chosen the FCPA Institute to elevate the FCPA knowledge and practical skills of their employees.

Representatives from the organizations at left have attended the FCPA Institute and set forth below is a sampling of what FCPA Institute “graduates” have said about their experience.

*****

“Unlike other FCPA conferences where one leaves with a spinning head and unanswered questions, I left the FCPA Institute with a firm understanding of the nuts and bolts of the FCPA, the ability to spot issues, and knowledge of where resources can be found that offer guidance in resolving an issue.  The limited class size of the FCPA Institute ensured that all questions were answered and the interactive discussion among other compliance professionals was fantastic.” (Rob Foster, In-House Counsel, Oil and Gas Company)

“The FCPA Institute was one of the best professional development investments of time and money that I have made since law school. The combination of black letter law and practical insight was invaluable. I would highly recommend the FCPA Institute to any professional who has compliance, ethics, legal or international business responsibilities.” (Norm Keith, Partner, Fasken Martineau, Toronto).

“The FCPA Institute is very different than other FCPA conferences I have attended.  It was interactive, engaging, thought-provoking and at the completion of the Institute I left feeling like I had really learned something new and useful for my job.  The FCPA Institute is a must-attend for all compliance folks (in-house or external).” (Robert Wieck, CPA, CIA, CFE, Forensic Audit Senior Manager, Oracle Corporation)

The FCPA Institute is a top-flight conference that offers an insightful, comprehensive review of the FCPA enforcement landscape.  Professor Koehler’s focus on developing practical skills in an intimate setting really sets it apart from other FCPA conferences.  One of the best features of the FCPA Institute is its diversity of participants and the ability to learn alongside in-house counsel, company executives and finance professionals. (Blair Albom, Associate, Debevoise & Plimpton)

“The FCPA Institute was a professionally enriching experience and substantially increased my understanding of the FCPA and its enforcement. Professor Koehler’s extensive insight and practical experience lends a unique view to analyzing enforcement actions and learning compliance best practices. I highly recommend the FCPA Institute to practitioners from all career stages.” (Sherbir Panag, MZM Legal, Mumbia, India)

“The FCPA Institute provided an in-depth look into the various forces that have shaped, and that are shaping, FCPA enforcement.  The diverse group of participants provided unique insight into how, at a practical level, various professionals evaluate risk and deal with FCPA issues on a day-to-day basis.  The small group setting, the interactive nature of the event, and the skills assessment test all set the FCPA Institute apart from other FCPA conferences or panel-based events.” (John Turlais, Senior Counsel, Foley & Lardner)

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