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The Origins Of 2016 Corporate FCPA Enforcement Actions

2016 was a record-breaking year for Foreign Corrupt Practices Act enforcement.

Largest number of corporate enforcement actions in FCPA history – check. Largest aggregate corporate settlement amounts in FCPA history – check. These statistics will all be profiled in much greater detail in future posts.

Before an FCPA enforcement action is announced however, FCPA scrutiny must first originate.

This post, the first in a weeks-long FCPA statistical feast on FCPA Professor, highlights the origins of 2016 corporate enforcement action.

DOJ/SEC Information Requests, Subpoenas, Industry Sweeps (13)

*[DOJ resolution document states that Teva disclosed to the DOJ “conduct in Russia and Ukraine of which the DOJ was previously unaware” – but elsewhere the same document states: “Teva did not timely voluntarily self-disclose the FCPA violations to the DOJ]

Voluntary Disclosures (10)

Foreign Law Enforcement Investigations / Foreign Media Reporting (3)

Unclear (1)

*****

The 37% voluntary disclosure statistic for 2016 corporate enforcement actions is down from the running five year average.

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Specifically, since 2011 there have been 49 corporate FCPA enforcement actions brought by the DOJ and 24 enforcement actions (49%) have originated with voluntary disclosures. Since 2011 there have been 69 corporate FCPA enforcement actions brought by the SEC and 28 enforcement actions (41%) have originated with voluntary disclosures.

Keep in mind that even these formal voluntary disclosure statistics undermine the prominence of voluntary disclosure to corporate FCPA enforcement. For instance, several FCPA enforcement actions against pharmaceutical companies have been based on the “fruits” of original voluntary disclosures as have a few other enforcement actions outside of the pharmaceutical sector.