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Friday Roundup

False, lack of context, stay in your lane, and for the reading stack. It’s all here in the Friday roundup.

False

At times it seems like we live in a post-factual world. If a fact gets in the way of a narrative, you just ignore the fact, pretend it doesn’t exist, and hope nobody calls you out on it.

Regardless of what you think about President Trump and Ukraine, the extent of Foreign Corrupt Practices Act enforcement in the Trump administration is a fact.

And the fact is that FCPA enforcement (both against business organizations and individuals) is above historical averages in the Trump administration. Indeed, if 2019 ended today (which of course it does not and the end of the year is historically an active period of FCPA enforcement) 2019 FCPA enforcement (measured in terms of corporate settlement amounts) is the third most active in the FCPA’s 40+ year history.

However, this Salon.com [1] article asserts “the [Trump] administration has also limited the enforcement of the Foreign Corrupt Practices Act, which prohibits companies from paying bribes to foreign officials …”.

Lack of Context

Related to the above issue, if certain other facts get in the way of narrative, once again you just ignore the facts and spin a narrative that lacks context.

This recent report from Public Citizen [2], a group that frequently publishes material that lacks context (see here [3] and here [4] for prior posts) is titled “Soft on Corporate Crime DOJ Refuses to Prosecute Corporate Lawbreakers, Fails to Deter Repeat Offenders.”

In summary form, the report states:

“The rationale for DPAs and NPAs is that they facilitate corporate compliance with the law and improve corporate culture better than prosecution would. But the empirical evidence strongly contradicts this theory; in short, the DOJ’s deals with large corporate offenders do not work. Most corporations that have faced multiple criminal enforcement actions, yet avoided prosecution, are large multinationals, and most of these have avoided prosecution more than once. Contrary to the DOJ’s theory of corporate rehabilitation, DPAs and NPAs do not prevent corporate recidivism.”

These pages have long raised concerns about NPAs and DPAs – including in the FCPA context – and thus generally agree with the above assertions.

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However, once again the Public Citizen report lacks context as NPAs and DPAs are nothing new and existed long before the Trump administration. Indeed, the Obama DOJ resolved 22 corporate FCPA enforcement actions through NPAs. Moreover, the Obama DOJ created the FCPA Pilot Program in April 2016 and announced 5 matters (either “declinations” or “declinations with disgorgement”) as being resolved consistent with the program.

Staying In Your Lane

This recent post [6] on the Global Anti-Corruption Blog is titled “International Scholars, Stay in Your Lane: The Risks of Uninformed Foreign Commentary on Corruption Cases.” Kudos to the author of the post for acknowledging that the GAC Blog “often hosts just such commentaries.” 

Specific to the FCPA and FCPA enforcement, I’ll add the following observation. Not all areas of law are like this, but without actual FCPA practice experience it is difficult to grasp all of the moving parts relevant to the FCPA and its enforcement. Yet time and time again, many commentators – who lack actual FCPA practice experience – comment on FCPA issues and their commentary is generally deficient in some basic regards. In certain situations, the commentator candidly acknowledges that he / she doesn’t have much relevant experience, but the person comments anyway. Some may say – no big deal. However, the problem is that media sources, and others, etc. seemingly have the view that commentator A, because of their institutional affiliation, must know what he or she is talking about. It is a problem in the FCPA space and leads to much misinformation in the public domain.

For the Reading Stack

An informative read here [7] from Professor Ellen Podgor titled “Corruption is Not a Crime.”

“Many perceive corruption to be a crime. In fact, however, corruption is not a federal crime, unless one is speaking about corruption of seamen and confederating with pirates, activities that are prohibited under the only federal statute in Title 18 of the U.S. Code that actually includes the term “corruption” in the title of the statute. A host of federal statutes beyond the criminal code use the term “corruption” with regard to programs that encourage good governance, such as providing aid to countries in order to combat corruption. And, of course, sentencing provisions reference corruption offenses. One might find the term “corruption” in legislative findings regarding extortionate credit transactions, for example. So too, there is the Foreign Corrupt Practices Act, but the conduct outlined in these statutes is limited, with certain parties, such as foreign officials, excluded from prosecution. […] Although some federal statutes do require a corrupt intent or a corrupt act, corruption by itself is not an offense.”

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Connect [8]