SAP Joins The Repeat Offender Club
In 2016 SAP (a German software company with American Depository Shares registered with the SEC) resolved a $3.9 million Foreign Corrupt Practices Act enforcement action.
As highlighted here, in 2019 the company disclosed additional FCPA scrutiny and stated: “SAP has received communications and whistleblower information alleging conduct that may violate anti-bribery laws in South Africa, the United States (including the U.S. Foreign Corrupt Practices Act (FCPA)), and other countries.”
Yesterday, SAP joined the ever-growing FCPA repeat offender club as the DOJ and SEC announced (here and here) related FCPA enforcement actions against the company. The net FCPA settlement amount is $102.5 million: DOJ ($63.6 million) and SEC ($38.9 million).
Issues To Consider From The Clear Channel Outdoors Enforcement Action
This recent post highlighted the $26.1 million enforcement action against Clear Channel Outdoors based on the conduct of a former indirect, majority-owned Chinese subsidiary (Clear Media Limited).
This post highlights additional issues to consider from the enforcement action.
Timeline
As highlighted here, in April 2018 disclosed FCPA scrutiny.
Thus, from start to finish, Clear Channel’s FCPA scrutiny lasted an unconscionable 5.5 years.
Billboard Worthy: Clear Channel Outdoor Resolves $26.1 Million Enforcement Action
Approximately 5.5 years ago (see here for the prior post), Clear Channel Outdoor Holdings (a public subsidiary of iHeartMedia and one of the world’s largest outdoor advertising corporations) disclosed FCPA scrutiny based on the conduct of “several employees of Clear Media Limited, an indirect, non-wholly-owned subsidiary of the Company whose ordinary shares are listed …. on the Hong Kong Stock Exchange.”
Today, the SEC (an enforcement agency whose officials have previously stated that it “should focus on bringing matters to resolution swiftly”) announced a $26.1 million FCPA enforcement action against the company.
In summary fashion, this administrative order finds:
An Informative Read
This prior post highlighted the recent acquittal of Damodar Arapakota (founder and former chief executive of Toronto-based Imex Systems) by a Canadian judge of a charge of bribery of a foreign public official under Canada’s Corruption of Foreign Public Officials Act (CFPOA)
The actual decision by the Canadian judge (see here) makes for an interesting read in that the CFPOA (while not a carbon copy of the FCPA) does contain many of the same general elements.
While touching upon other CFPOA elements such as mens rea and the meaning of advantage or benefit under the CFPOA, the main reasons the judge found Arapakota not guilty was due to the lack of nexus between the advantage or benefit (travel expenses) given to the foreign official and the discretionary act performed by the foreign official as well as the judge’s conclusion that the discretionary act performed by the foreign official did not satisfy the CFPOA’s “obtain or retain an advantage in business” element.
The logic, reasoning and rationale of the decision are all FCPA relevant.
Flowers
Today is Valentine’s Day – a day often associated with flowers.
Many discussions regarding bribery are vague (and compliance a challenge) because the “b” word (bribery) can mean different things in different contexts.
Indeed, many Foreign Corrupt Practices Act enforcement actions concern things of value such as jobs and internships, sport tickets, food and beverage, leisure activities, etc. that are normal and legal in most circumstances.
Yet providing such things of value to a specific type of person (an individual the DOJ/SEC deem to be a “foreign official”) may expose a company or individual to the “b” word.
And this includes flowers.