Previous posts have highlighted FCPA enforcement actions concerning conduct (in whole or in part) Greece, Georgia and Ukraine, and Poland.
This post highlights FCPA enforcement actions concerning conduct (in whole or in part) in the following countries: Romania, Bulgaria, Hungary, Slovakia, Slovenia, and Czech Republic.
Romania
The enforcement action concerned conduct in Romania and the allegations were: “Between 2007 and 2012, Elbit and Plaza [a majority-owned indirect subsidiary], directly and indirectly, paid millions of dollars to third-party offshore consultants and sales agents purportedly for their services related to a real estate development project in Romania and the sale of a large portfolio of real estate assets in the U.S. However, Elbit and Plaza made these payments even though they had no evidence that the consultants and sales agents had actually provided the contracted for services. Elbit and Plaza failed to properly record those payments in a manner that, in reasonable detail, accurately and fairly reflected the nature of the payments in their books and records. Elbit and Plaza also failed to devise and maintain internal accounting controls sufficient to provide reasonable assurances that company funds would only be used as authorized for legitimate corporate purposes and that transactions were recorded as necessary to maintain accountability for assets, particularly with regard to the accounts payable process.”
In November 2024, the SEC announced a Foreign Corrupt Practices Act enforcement action against Cyril Sebastien Dominique Cabanes (“Cabanes”) – a French citizen and resident of Singapore who was previously a member of the board of directors of Azure Power Global Limited (a Mauritius company with its principal place of business in India).
During the time period relevant to the enforcement action, Azure was a publicly traded company with shares traded on the New York Stock Exchange.
The enforcement action concerns alleged bribes paid to Indian officials to secure multi-billion dollar energy projects for Azure and another company Adani Green Energy Limited.
In recent months, I’ve had several exchanges with various individuals (including journalists) about FCPA enforcement and the false narrative that FCPA enforcement has stopped.
When shown clear evidence that the narrative is indeed false, two common responses have been:
(1) but FCPA enforcement activity during the Trump administration involves matters initiated / begun (use whatever term you want) during a prior administration; and
(2) but the Trump administration has closed / abandoned (use whatever term you want) FCPA inquiries or investigations without bringing an enforcement action.
These common responses ignore the fact that both dynamics have been part of FCPA enforcement for nearly 50 years.
As highlighted in this prior post, in 2012 BizJet International Sales and Support Inc. (a Tulsa, OK based provider of aircraft maintenance, repair and overhaul services) resolved an $11.8 million FCPA enforcement action “for bribing government officials in Latin America to secure contracts to perform aircraft services for government agencies.”
The enforcement action alleged conduct by several executives generically referred to at the time as Executive B, Executive B, Executive C, and Sales Manager A.
In 2013, the DOJ announced the unsealing of related criminal charges (filed in 2012) of the four executives and revealed the names of the executives including “Sales Manager A” Jald Jensen.
Recently, I had some back and forth exchanges on LinkedIn with John Reed Stark (a former SEC enforcement attorney) on SEC FCPA enforcement.
An overview of the points I raised are set forth below.
Often when there is a discussion about enforcement of a specific law and comparing enforcement actions to prior years, the question perhaps left unanswered “how much enforcement should there actually be?”
Thus, when it comes to SEC enforcement of the FCPA (“foreign bribery” actions – not necessarily “non-FCPA, FCPA enforcement actions” – a term long used on this site to describe enforcement actions by the SEC involving the FCPAs books and records and internal controls provisions, but not involving foreign bribery, of which there have been several this year including earlier this month), it must be noted that the SEC has rather limited jurisdiction (generally speaking only against issuers).