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Oh The Hypocrisy

In this recent opinion column, John Podesta (the chair of Hillary Clinton’s 2016 presidential campaign) calls SEC Chair Jay Clayton “a public critic of the FCPA.”

However, just because one voices some concerns as to how the FCPA is enforced (as a committee that Clayton chaired did in a 2011 report titled “The FCPA and its Impact on International Business Transactions – Should Anything Be Done to Minimize the Consequences of the U.S.’s Unique Position on Combating Offshore Corruption?”) does not make one a “public critic of the FCPA” (the law itself).

In recent years there was a high-profile and vocal critic of not only how the FCPA was enforced, but the FCPA itself. And that person was Andrew Weissmann, who in January 2015 joined the Obama Department of Justice to become Chief of the DOJ’s Fraud Section.

Using phrases such as “how far the DOJ has pressed the limits of enforcement,” “DOJ’s aggressive pursuit” of companies as “indication of how far the DOJ is willing to expand the scope of FCPA enforcement,” and “the highly aggressive stance the DOJ is taking to expand the FCPA net beyond its borders,” Weissmann stated that “the current FCPA enforcement environment has been costly to business.”

In proposing a number of statutory amendments to the FCPA, Weissmann wrote that “the FCPA should be modified to make clear what is and what is not a violation”

Testifying before Congress, Weissmann stated:

“The FCPA had been tailored to balance various competing interests, but that balance has been altered, at times, by aggressive application and interpretations of the statute by the government. Instead of serving the original intent of the statute, which was to punish companies that participate in foreign bribery, actions taken under more expansive interpretations of the statute may ultimately punish corporations whose connection to improper acts is attenuated at best and nonexistent at worst. The result is that the FCPA, as it currently written and implemented, leaves corporations vulnerable to civil and criminal penalties for a wide variety of conduct that is in many cases beyond their control and sometimes even their knowledge.”

Did Podesta ever write about Weissmann being a “public critic of the FCPA” when he joined the Obama administration?

Of course not.

By the way, Weissmann recently relinquished his Fraud Section position to join Special Counsel Robert Mueller’s staff.

ISO 37001

Just when you think you’ve seen it all regarding the massively over-hyped ISO 37001, along comes this article asserting that ISO 37001 is a “new” standard, that it provides a “much-needed level of anti-bribery guidance” and that it is “gaining traction.”

Time out.

ISO 37001 is hardly a “new” standard if you are familiar with the numerous sources of best practices in the anti-bribery space. Indeed IS0 37001 is a complete yawner, as well as a disappointment as several best practices are not even captured in the purported best practices document.

As to the “much-needed level of anti-bribery guidance” assertion, the notion that IS0 37001 is somehow the magical potion that has eluded the compliance community up until now is laughable. There have been numerous sources of anti-bribery guidance that have long been in the public domain prior to ISO 37001 (which by the way you have to pay to access).

Regarding the “gaining traction” assertion, ISO 37001 has been public now for about 7 months and all that has happened from a corporate perspective it seems is that two companies under FCPA scrutiny are thinking about being ISO 37001 certified (for reasons likely due to optics, not substance). This is a pretty generous meaning of gaining traction.

As evidence that ISO 37001 is the next greatest thing, the article cites a person who helped create ISO 37001 and another individual who is selling compliance services related to it (indeed the individual has an ISO 37001 compliance website and an e-mail address ending in iso37001compliance.com). That hardly establishes the truth of the matter asserted.

The article contains the following paragraph:

“Here’s what it means for business: if you do business overseas and wish to (finally) get positive recognition for your FCPA program and other anticorruption efforts, consider applying ISO 37001 as a creative antibribery tool.”

I’ve re-written the paragraph below:

“Here’s what it means for business: if you do business overseas and wish to adopt compliance best practices in a time-efficient and cost-efficient manner, ignore ISO 37001 because there are numerous other best practice metrics out there. Indeed in the DOJ’s Feburary 2017 “Evaluation of Corporate Compliance Programs” the DOJ cites these metrics and notably the DOJ does not even mention ISO 37001.”

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