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DOJ To Increase Its Focus On Investigations, Prosecutions, And Asset Recoveries Relating To Corruption In Northern Triangle Countries

northerntri

Presumably in connection with the visit by Vice President Kamala Harris to Guatemala, earlier this week U.S. Attorney General Merrick Garland “announced a series of steps that the Department of Justice is taking to address the threats posed by both corruption and by transnational human smuggling and trafficking networks” in Central America.

The main focus of the establishment of so-called “Joint Task Force Alpha” will be “to enhance U.S. enforcement efforts against the most prolific and dangerous human smuggling and trafficking groups operating in Mexico and the Northern Triangle countries of Guatemala, El Salvador, and Honduras.”

In addition, the DOJ release states: “Joint Task Force Alpha will also complement the Justice Department’s efforts to fight corruption.  The Justice Department will increase its focus on investigations, prosecutions, and asset recoveries relating to corruption in Northern Triangle countries through its Foreign Corrupt Practices Act enforcement program, counternarcotics prosecutions, and Kleptocracy Asset Recovery Initiative.”

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Remember When …

Memory Lane

Remember when Acting Principal Deputy Assistant Attorney General Trevor McFadden stated that it was the DOJ’s “intent … for our FCPA investigations to be measured in months, not years.”

This statement was made four years ago this week (see here for the prior post).

However, like much DOJ rhetoric surrounding the FCPA, it was just empty words. As highlighted below, since the DOJ’s statement of intention it has resolved approximately 30 corporate enforcement actions and the average length of time a company has been under FCPA scrutiny has been approximately 4.25 years.

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SEC Commissioner Calls The SEC’s Approach To Corporate Penalties “Fundamentally Flawed”

Crenshaw

In the FCPA’s modern era of enforcement, the bulk of SEC settlement amounts consist of disgorgement and prejudgment interest (See here). Stated differently (and although there have been a few notable exceptions), civil penalties are not a major feature of most corporate SEC Foreign Corrupt Practices Act enforcement actions.

Even so, SEC civil penalties can be FCPA relevant and it is thus interesting to note that SEC Commissioner Caroline Crenshaw (appointed by President Trump and sworn into office in August 2020) recently stated that the SEC’s historical practice of placing emphasis on factors beyond the actual misconduct when imposing corporate penalties is “fundamentally flawed.”

In this recent speech before the Council of Institutional Investors , Crenshaw began by stating how an SEC decision made 15 years (see here) “has taken us off course.”

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Acting Deputy Ass’t AG Zink Talks Data, Cooperation, And Coordination

DOJ

Recently, Acting Deputy Assistant Attorney General Robert Zink delivered this virtual speech in which he talked about: (i) the DOJ’s use of data; and (ii) cooperation and coordination including the DOJ’s so-called “anti-piling” policy.

Zink also stated that “it’s important that the [DOJ Criminal] Division is held accountable by the public for its work—both good and bad.” Duly noted.

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Acting Assistant Attorney General Rabbitt Talks Enforcement Numbers

rabbitt

Earlier this week, Acting Assistant Attorney General Brian Rabbitt delivered this virtual speech at the FCPA’s annual dog and pony show (also know as the American Conference Institute’s FCPA conference).

As highlighted below, in the speech Rabbitt discussed, among other things, “the canard that white-collar enforcement — and FCPA enforcement in particular — has been lackluster during this administration.” As Rabbitt correctly stated: “nothing could be further from the truth.”

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