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Friday Roundup

Overhead at the town hall meeting, sentenced, investigative fees, “fake” FCPA news, fairly obvious, hook-line-and-sinker, fore, pardon me for being a stickler, ISO37001 related, and purely speculative and not credible.

It’s all here in the Friday roundup

Overhead at the Town Hall Meeting

I can’t imagine that the FCPA is a frequent topic of discussion at New England town hall meetings. But as highlighted here [1] it was recently a topic of discussion as “the new operator of a popular ski resort in New Hampshire [Och-Ziff]  faced off against concerned residents, some of whom fear the company’s past legal troubles raise doubts about whether it was the right choice to oversee the facility.”

As stated in the article:

“The company reached a settlement last year with the Department of Justice and the Securities and Exchange Commission regarding bribery allegations in Africa. The company paid a $213 million fine in connection with what the Department of Justice called “a widespread scheme involving the bribery of officials in the Democratic Republic of Congo (DRC) and Libya.”

“We appeal to elected state officials to begin a complete and transparent review of this lease acquisition and all documents related to it so that the people of New Hampshire, who are the rightful owners of the Mount Sunapee State Park, can (be) rest assured that our state park is in the hands worthy of the public’s trust,” Steve Russell, the president of the Friends of Mount Sunapee, told the meeting.

Joan Schwartz, a Sutton resident who has skied frequently at the resort, said residents were not only uncomfortable with the bribery allegations but with the fact the company was a hedge fund which has an “obvious interest for making money.”

Sentenced

This previous post [2] highlighted the DOJ’s trial court victory in the money laundering case against Mahmoud Thiam, the former Minister of Mines and Geology of the Republic of Guinea. As highlighted in this DOJ release [3], Thiam was sentenced “to seven years in prison, and three years of supervised release, for laundering bribes paid to him by executives of China Sonangol International Ltd. (China Sonangol) and China International Fund, SA (CIF).

Scrutiny Alert

As highlighted in this prior post [4], in September 2016 Misonix disclosed FCPA scrutiny concerning certain practices in China. In its recent annual report [5], the company provided an update and disclosed “the investigative costs to date are approximately $2.5 million.”

“Fake” FCPA News

Did you know that “to date, US [FCPA] authorities have only undertaken investigations under the [FCPA] in China when the Chinese have already uncovered corruption” and that this “means any investigation or prosecution is contingent upon the findings of a Chinese investigation.”?

Probably not. And for good reason. It among the many false or misleading assertions in this article [6].

[7]

Fairly Obvious

This recent FCPA Blog post [8] with the headline “DOJ Named in 77 Open FCPA-Related Investigations,” made me chuckle.

Given that only the DOJ and SEC can enforce the FCPA, the headline is like saying that the NFL is involved in all (insert your favorite team) games this upcoming season.

Hook-Line-And-Sinker

It is pretty amazing how some (many) FCPA commentators appear to have fallen “hook-line-and-sinker” for the DOJ’s rhetoric on individual accountability for FCPA offenses.

For instance, in this article [9] a commentator states:

“There has been an increased focus in recent years by the US Department of Justice (DOJ) on individual accountability and the effectiveness of a company’s compliance programme. With the issuance of the ‘Individual Accountability for Corporate Wrongdoing’ memorandum in 2015, the DOJ focused on the role individual culpability plays in Foreign Corrupt Practices Act (FCPA) related matters.”

And now for some facts.

As highlighted in this post [10], since the September 2015 Yates Memo there have been approximately 20 DOJ corporate FCPA enforcement actions in which the DOJ collected approximately $1.2 billion. Yet, not one company employee (zero, zilch, nada) has been charged with FCPA offenses by the DOJ. 

Fore

I recently saw on social media how a legal professional was looking forward to playing in the SEC Philadelphia Regional Office annual golf outing on Sept. 8th.

Given that the SEC has concluded [11] that “golf in the morning and beer drinking in the evening” is a form of bribery if directed at certain type of people, I would love to learn more about the logistics of this event! 

Pardon Me For Being A Stickler

Pardon me for being a stickler (actually many people have recently thanked me privately for doing so), but when you run an FCPA-related website you have to get certain things right – such as the actual elements of the FCPA.

Relatively minor point, but this post [12] states: 

“Healthcare officials, physicians and staff are typically government employees and often fall within the FCPA definition of a “government official.”

The term “government official” doesn’t even appear in the FCPA. Rather, the statutory term and statutory definition is “foreign official.” 

ISO 37001 Related

It is tough to take much of the material out there about ISO 37001 seriously when they appear to be little more than marketing pieces for the author’s company complete with a marketing pitch at the end of the material. (See here [13] for an example).

More substantively, if ISO 37001 certification is to be taken seriously those writing about it should provide complete factual information about the process (not just selective information). Most importantly, how much did this all cost so that other business organizations can properly assess this compared to the many other options in the marketplace for benchmarking compliance.

*****

Just because an individual selling ISO 37001 certification services received a phone call does not mean that “shareholder activism is the latest frontier in the anti-bribery movement.” (See here [14]).

Moreover, the following statement is laughable: “a great, documented anti-bribery program that has met the rigorous standards of ISO 37001 certification is the best public confirmation that a company has truly invested in its anti-bribery program”

Purely Speculative and Not Credible

Before certain FCPA commentators (I’ll call them the “everything is awesome [15]” crowd) proclaim that [16] the Linde and CDM Smith “declinations were superior results obtained by the companies as both had clearly violated the FCPA, for multiple years in ongoing bribery and corruption schemes” it would be nice to see some actual analysis of facts. (See here [17] and here [18]).

Calling these FCPA enforcement actions “superior results” is purely speculative and not credible.

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Connect [19]