DOJ’s McFadden Makes Sense When Talking About “Declinations” And States That FCPA Investigations Should Be “Measured In Months, Not Years”
Yesterday, Acting Principal Deputy Assistant Attorney General Trevor McFadden deliver this speech in Washington, D.C.
Sure, like a prior recent speech, McFadden did read from the “DOJ’s FCPA script,” but to his credit he did say some important things about FCPA compliance that is refreshing to hear from the DOJ. In addition, McFadden’s statement that his “intent is for our FCPA investigations to be measured in months, not years” should be welcome news to the business community. However, the DOJ has been saying the same thing for years and a wait and see approach is most prudent. For instance, in this 2005 speech then DOJ Assistant Attorney General for the Criminal Division Christopher Wray talked about “real-time enforcement” and stated: “in other words, punishing wrongdoers promptly after they commit their crimes. Simply put, speed matters in corporate fraud investigations . The days of five-year investigations, of agreement after agreement tolling the statute of limitations-while ill-gotten gains are frittered away and investor confidence sinks-are increasingly a thing of the past.”
Moreover, as highlighted in more detail below, McFadden made sense when talking about DOJ “declinations” and his reasons for why the DOJ may not bring a Foreign Corrupt Practices Act enforcement action in an instance of FCPA scrutiny undermines the “declination” definition used by certain FCPA Inc. participants.
DOJ Is Noncommittal Regarding The Future Of Its FCPA Pilot Program, But Who Really Cares?
On April 5, 2016, the DOJ announced a one-year FCPA Pilot Program (see here for the prior post).
With just a few weeks left in the program, the DOJ could easily make an emphatic statement about the future of the program.
But that is not what Acting Assistant Attorney General Kenneth Blanco did last week in a speech at the ABA National Institute on White Collar Crime.
Civil Monetary Penalties In SEC FCPA Enforcement Actions
This recent speech by Acting SEC Chairman Michael Piwowar received some coverage based on the following sentence from the speech: “I am generally comfortable with assessing civil monetary penalties in Foreign Corrupt Practices Act cases.”
It’s unclear what Piwowar really meant by this statement.
As highlighted below, approximately 40% of SEC corporate FCPA enforcement actions since 2010 have included civil monetary penalties even if such penalties have traditionally been a very minor component of overall settlement amounts because of the dominance of disgorgement and prejudgment interest.
DOJ Deputy Assistant Attorney General McFadden Delivers The FCPA Script
One can predict with a high degree of certainty what high-ranking DOJ officials will say about the Foreign Corrupt Practices Act before even hearing or reading the speech (and I say that based on highlighting on these pages over 100 FCPA enforcement agency speeches since 2009).
The script goes like this: the DOJ places a high-priority on FCPA enforcement as well as transparent enforcement; the DOJ is committed not just to corporate enforcement, but holding individuals accountable as well; and companies benefit from voluntary disclosure and cooperation.
New DOJ Deputy Assistant Attorney General Trevor McFadden delivered the script recently in this speech. However, if you want to know how McFadden really feels about DOJ enforcement of the FCPA you might want to review his recent writings on the topic highlighted in this recent post.
SEC Director Of Enforcement Ceresney On …
Yesterday’s post highlighted comments made by Deputy Attorney General Sally Yates at a recent Foreign Corrupt Practices Act event and this post provides equal time to comments made by SEC Director of Enforcement Andrew Ceresney at the same event.
Similar to the DOJ speech, much of Ceresney’s speech represents the same old, same old something even he acknowledged during his speech.
When reading Ceresney’s comments about the importance of individual FCPA prosecutions keep in mind the following facts. In 2016 there have been 21 SEC corporate FCPA enforcement actions and 15 actions (72%) have not resulted (at least yet) in any related FCPA charges against company employees. This figure is generally consistent with the overall figure since 2008 in which approximately 80% of SEC corporate FCPA enforcement actions have not resulted in any related FCPA charges against company employees.