On Being An FCPA Associate … A Q&A With Oleh Vretsona
FCPA Professor enjoys a diverse group of readers, including law students and others interested in careers that focus on the Foreign Corrupt Practices Act.
To these readers and others, meet Oleh Vretsona , a 2006 graduate of the University of Minnesota Law School, a 1997 graduate of the Ivan Franko National University, Law Department, Lviv, Ukraine, and a current associate at Gibson, Dunn & Crutcher in Washington, D.C.
In the below Q&A, Vretsona describes his FCPA experiences to date and provides advice to students interested in FCPA careers.
What was your first FCPA-related assignment?
The FCPA monitorship for Statoil ASA was my first assignment in this area of law. Statoil’s 2006 settlement with the SEC and DOJ was the first ever to impose a monitor on a foreign issuer. Gibson Dunn partner Joe Warin was appointed to serve in this role. I had the amazing and rewarding opportunity to serve as a core member of Joe’s team and support the monitorship for three years, seeing it through to successful completion in November 2009. The opportunity allowed me to develop a holistic and thorough understanding of Statoil’s worldwide business and approach to compliance, and assist the company in enhancing its anti-bribery compliance program to address the constantly changing risks of global energy exploration and extraction. My work on the monitorship included analyzing new corporate compliance policies and procedures, meeting with company personnel tasked with anti-bribery compliance and responsible for operations in higher-risk regions, and visiting numerous Statoil facilities around the world. Statoil successfully completed the monitorship in November 2009, when the U.S. government dismissed the criminal charges against the company.
What countries have you visited doing FCPA work?
Azerbaijan, Denmark, Germany (more than 5 times), Indonesia, Norway, Poland, Russia (more than 10 times), and Turkey.
Of those countries, what has been your most memorable experience?
I have had many memorable experiences from my FCPA-related travel. My most memorable experience was meeting Siemens’s Monitor, former German Minister of Finance Theo Waigel—a remarkable politician, lawyer, and person, known as the father of the Euro, the European Union currency—during the Monitor’s team visit to Russia. Another experience that stands out in my memory is being questioned extensively about the purpose of my visit by Azerbaijani border control guards before the departure of my flight from Baku to London. After a long back and forth with them, I barely made my flight.
As you learned more about the FCPA, what surprised you the most?
I guess it was not so much a surprise, as a realization of the importance of each individual employee’s compliance awareness, integrity, and willingness to report concerns, wherever she or he is located, to a company’s overall compliance effort. Much of the work I have done for clients has revolved around how to drive a culture of compliance throughout a global organization while taking into account the local cultural differences. I have seen how important it is for management to model compliant behavior and communicate the company’s compliance values to employees, especially in higher-risk locations. The compliance buy-in that is instrumental to this effort especially needs to come from mid-level managers, whose integration into compliance processes makes compliance a natural part of a company’s daily business decisions.
If you could change one thing about the FCPA or FCPA enforcement, what would it be?
If I could change one thing about the FCPA or FCPA enforcement, it would be to afford organizations the affirmative defense of an effective compliance program to avoid liability for anti-bribery violations of the statute by employees or agents, similar to the affirmative defense to section 7 of the U.K. Bribery Act. I believe that this would bring more certainty into companies’ business operations and compliance planning, and would increase corporate innovation in enhancing compliance processes.
What advice do you have to students or young associates interested in having an FCPA practice?
My main advice would be to develop a passion for and curiosity about international developments and foreign language capabilities. In addition to extensive knowledge of the law and compliance practices, these two competencies distinguish associates from others in the field and equip them with tools that help address complicated compliance-related issues that are frequently rooted in various countries’ cultural realities. I am blessed with working with a global team of Gibson Dunn lawyers who share my abiding interest in understanding client problems, providing targeted advice, and forging solutions for them throughout the world.
In my own career, I have seen the great value of marrying expertise in the law and compliance with linguistic abilities—in my case, fluency in Russian and Ukrainian, as well as advanced knowledge of Polish—and local cultural experiences. There is no substitute to being able to conduct work—especially internal investigations—in the native language of individuals involved in the matter and to understand the cultural underpinnings of employees’ daily decisions.
An FCPA Lawyer In Paris
Today’s post is a Q&A with Bryan Sillaman (Hughes Hubbard & Reed). Sillaman is a member of the firm’s Anti-Corruption and Internal Investigations Practice Group and is currently working in the firm’s Paris office. Prior to joining Hughes Hubbard, Sillaman was an attorney in the SEC Enforcement Division where he conducted several Foreign Corrupt Practices Act investigations.
Q: What brought you to Paris and what is it like being an FCPA lawyer in Paris?
Hughes Hubbard has had an office in Paris for nearly 50 years, and has a long history representing French companies. I was fortunate enough to be asked to come to Paris to assist one of our French clients with a global anti-corruption review. At the time, it was unclear how long I would stay, but that was nearly four and a half years ago. It has been fascinating and instructive to see how the FCPA and U.S. enforcement environment is perceived within Europe, and to also witness the development of other significant international anti-corruption initiatives, such as the passage of the U.K. Bribery Act, which got the attention of a lot of European companies. The industry of compliance appears to be steadily growing in France, with one of the French universities creating a Masters in Law in Business Ethics (Master Droit & Ethique des Affairs). While part of this seems to be in response to increased enforcement of European companies by the U.S., I also believe that the political climate in Europe generally, and France specifically, is becoming less tolerant of corruption – particularly at the governmental level – which has helped fuel the industry.
Q: How are European clients different from U.S. clients, perhaps in terms of voluntary disclosure, cooperation with enforcement agencies, etc.?
One thing to keep in mind when working with European companies is that, at least in certain countries, it was legal and in fact tax deductible to pay bribes until just over a decade ago. In this sense, anti-corruption compliance is a newer issue for many companies, although it is one that is gaining increased focus and attention, particularly within multinational corporations. It should also be remembered that for the first approximately twenty years of the FCPA’s existence, it was relatively rarely enforced. Thus, while perhaps some European countries are lagging the U.S. in bringing their own enforcement proceedings, there does appear to be an increased focus on the issue within the corporate community.
For better or worse, European conceptions of topics such as voluntary disclosure, cooperation, and remediation have been largely shaped to date by U.S. enforcement jurisprudence and posture. Therefore, in advising European companies on such issues, counsel naturally have differing philosophical viewpoints on the potential benefits and pitfalls of voluntary disclosure or cooperation. Anecdotally, however, I think that the concept of voluntary disclosing issues to the government (and potentially being prosecuted in return) strikes many European companies as contrary to sound logic. European clients also find fascinating the broad jurisdictional view taken by U.S. (and now U.K) regulators, as well as what until recent history is a new concept: that of the independent corporate monitor.
There are also more nuanced issues that can have a profound impact on how to conduct a compliance review with European companies that may, at first blush, seem unusual to U.S. counsel. For example, one of the initial differences that will likely become apparent is how European companies approach data privacy rights of employees and the handling or movement of potentially sensitive information. Europe in general, and certain countries like France in particular, have much stronger personal privacy data rights than those we may be familiar with in the United States, and these rights extend into an individual’s workplace. Counsel who are not wary of these issues and take them in consideration in structuring and conducting a review can face their own legal trouble. In addition to bestowing legal rights on individuals, these data privacy concerns must also be taken into account culturally, in the sense that counsel should be prepared for greater resistance to activities such as the collection of emails and electronic data that may be necessary, but nonetheless intrusive, steps towards conducting an effective review.
Q: You have travelled extensively as part of your FCPA practice (Angola, Brazil, China, Indonesia, Malaysia, the Middle East, Nigeria, Thailand and Venezuela). From these travels and experiences, what do you believe are the major root causes of FCPA violations?
Corruption is most certainly a two-way street. When it comes to bribe payers, unfortunately many cases seem to boil down to greed and a myopic focus on winning at all costs that is ever-too-present in many industries. For sure there are frequently claims that “everyone else is doing it,” but as we all learned when we were young, that doesn’t make it right. In terms of bribe recipients, while I will not claim to have researched the issue as much as others have in this field, anecdotally one of the major themes in countries we often visit is the absence of a fair and livable wage for government functionaries. In these cases, officials may feel as though there is no alternative but to seek payments from companies and their employees (who they may see living at a much higher standard) in order to earn a sufficient living. With larger-scale corruption, I think the same mentality exists, but in a more perverse way – officials placed in charge of vast amounts of resources see companies and others making significant amounts of money off of those resources and see no alternative but to seek what they come to view as their rightful piece of the pie.
Q: What do you know or realize now as it relates to the FCPA and FCPA compliance that you did not know or realize while at the SEC working on FCPA cases?
Perhaps it was more a function that I was at the SEC very early in my career, but I did not realize until traveling extensively assisting clients in this area the importance that companies place on practical guidance when it comes to anti-corruption compliance. It is one thing to recite to a client the FCPA’s statutory language, but quite another to provide helpful guidance on ways in which companies can operate in a legal and compliant way in very difficult locations and business environments. I and my colleagues operate from the premise that most people want to do the right thing, they just need the training and guidance to do so. I think this thirst for practical guidance is one of the reasons that DOJ/SEC Resource Guide to the U.S. Foreign Corrupt Practices Act has been well received within this community, and I applaud both agencies for the significant efforts that went into making it approachable and practical. Certainly, there remain very difficult questions, some of which do not have a clear answer. For example, when and to what extent is it appropriate to take personnel action against an employee? There may not be a black-and-white answer to this question, and in Europe, where labor laws tend to heavily favor employees, implementing appropriate employee sanctions can be quite difficult. Having been fortunate enough to have helped companies navigate through some of these issues, I acknowledge that I lacked a full appreciation earlier in my career for the time and energy that companies and their compliance personnel devote to implementing, in a practical way, the anti-corruption legal standards and guidance that govern their activity.
On Being An FCPA Associate … A Q&A With Nathan Lankford
FCPA Professor enjoys a diverse group of readers, including law and other students interested in careers that focus on the Foreign Corrupt Practices Act.
To these readers and others, meet Nathan Lankford, a 2008 graduate of Georgetown University Law Center and a current associate at Miller & Chevalier in Washington, D.C. In the below Q&A, Lankford describes his FCPA experiences to date and provides advice to students interested in FCPA careers.
What was your first FCPA related assignment?
Well, it wasn’t very glamorous – I wrote an article for our FCPA Review on “Jack” Stanley’s settlement with the DOJ. On the bright side, it turned out that a few months later, this case was required reading for my first major assignment as the main Associate on the monitor team for KBR, a prominent engineering and construction company of which Stanley had been CEO. KBR settled with the DOJ and SEC for a long-running bribery scheme in Nigeria, and the settlement remains the biggest against a US company in FCPA history. That was my primary project for three years, and a lot of fun. I got to work with some of the greatest minds and personalities at my firm, met impressive people at all levels of KBR, and had a role in solving complex compliance issues. When it wrapped up, I felt like I’d earned a PhD in anti-corruption law.
What countries have you visited doing FCPA work?
Algeria, Cameroon, Equatorial Guinea, Nigeria, China, Indonesia, Israel, Qatar, Cyprus, Ireland, Kazakhstan, Poland, Argentina, Brazil, and Mexico.
Of those countries, what has been your most memorable experience?
Flying by helicopter to an Algerian facility. A close runner-up would be when Nigerian airport officers took my iPhone. In case you’re wondering, no bribes were paid, and they gave it back…eventually.
As you learned more about the FCPA, what surprised you the most?
The biggest surprise was discovering the countless ways corruption can happen. I still haven’t come across a situation where an official said “I can fix this problem for a bribe.” The pressures and requests are almost always subtle, and constantly taking new forms. I love hearing the stories of people working in challenging contexts because they often have more direct experience of such pressures – at work and in their personal lives – thanDC-based lawyers like myself.
If you could change one thing about the FCPA or FCPA enforcement, what would it be?
Like many other people, I’d like more official guidance on certain issues so companies can better focus on high-risk transactions. The DOJ’s/SEC’s recently issued Resource Guide to the FCPA is of course a very positive development in this regard, but I think it could have gone further to settle some debates that drain compliance resources, such as the proper way to identify “foreign officials” in the context of partially state-owned enterprises. More broadly, if I was asked what should be done to better fight corruption, I’d say I’d like to see more action by host countries on the demand side, with perhaps technical and other assistance from capital exporters like the US. Enforcement against companies can only do so much.
What advice do you have to students or young associates interested in having an FCPA practice?
I’d encourage anyone wanting to develop an FCPA practice to find ways to build credibility over time – specifically, with ordinary people you’ll be speaking with at companies, not just with other practitioners with specialized knowledge. Travel obviously helps– it’s good to be able to tell a skeptical interviewee in Malabo that you’ve visited EG several times before– as do language skills. It also helps to know the basics about the industries you serve, and how anti-corruption compliance fits into the bigger picture of corporate integrity, rule of law, and commercial realities. So I’d say that aside from developing the fundamental skills that all good lawyers need, students and young associates should take the time to travel and read widely, and stay practiced at talking with non-experts and non-lawyers.
On Being An FCPA Associate … A Q&A With Rohan Virginkar
Meet Rohan Virginkar (here), a 2004 graduate of The George Washington University School of Law, and current associate at Foley & Lardner in Washington D.C.
Virginkar has a wealth of FCPA experience and in this post he describes what it takes to succeed as an FCPA associate.
Develop fact investigation skills, pay attention to detail, be self-sufficient, and develop a firm grasp of the FCPA – all good pointers to students and young associates interested in a Foreign Corrupt Practices Act practice.
It also helps to have a valid passport and to embrace unpredictability because you may be sitting at your desk on Tuesday and be in Beijing on Saturday in the often fast-paced world of FCPA investigations.
Below is my Q&A with Virginkar.
What was your first FCPA related assignment?
My first FCPA case was within the first few months of starting as an associate. I traveled to Mumbai to investigate an allegation that an Indian subsidiary of our US-based client had paid money to a local government official in exchange for his agreeing not to disrupt their business. The allegations were true, and we discovered that a manager at the company had actually handed a duffel bag of currency to the official under the guise of a “donation” to the official’s favorite “charity”. It was a valuable introduction to the FCPA: shakedowns by foreign government officials, “charitable donations” to potentially suspect charities; it had many FCPA red flags all in one case.
What countries have you visited doing FCPA work?
In addition to India on that very first investigation, the matters I’ve had the good fortune of working on have taken me all over: Angola, China, Egypt, Indonesia, Kazakhstan, Kuwait, Lebanon, Nigeria, Qatar, Singapore, Thailand, the United Arab Emirates and Venezuela.
Of those countries, what has been your most memorable experience?
Each country I’ve visited on these matters has been memorable because the people, places and work have always defied expectations and offered nice surprises. That said, having a manager at a Chinese company who we instructed to stop paying kickbacks threaten us by saying that some of the payments were going to the Chinese Triads and that he would have to tell them that “the American lawyers” made him stop paying them is definitely one that sticks in mind.
As you learned more about the FCPA, what surprised you the most?
I’ve perhaps been most surprised by the genuine desire of most people around the world to follow the general goals of the FCPA, even if they don’t always understand the strictures and even when they occasionally get it wrong.
If you could change one thing about the FCPA or FCPA enforcement, what would it be?
I think the underlying goals of the FCPA are just, so there isn’t anything about the law that I would necessarily change. In terms of enforcement, I think the lack of clear judicial guidance on a number of gray areas of the FCPA sometimes makes it difficult to advise clients, who are forced to balance their business interests with a desire to comply with the law. I’d like to see more real case law develop, which is something I’m sure we’ll start to see as more individuals face stiff penalties for violations of the FCPA. The newly passed whistleblower provisions also give me some pause, because companies that have put in the resources to develop effective compliance programs with internal reporting mechanisms may now see that undermined because potential whistleblowers may see a financial incentive to make allegations, when such information may or may not be the basis of an FCPA allegation. However, it is too early at this point to know for sure what the practical effect on both enforcement and compliance will be.
What advice to you have to students or young associates interested in having an FCPA practice?
It’s important for young lawyers to hone their general litigation skills. Internal investigations (particularly when they have international elements) are a different beast from general commercial litigation, but the same skills that make someone a good litigator also form the foundation of being a good investigator. You have to be logical, methodical, with an eye for detail, because you never know what the smoking gun will look like. Being flexible and maintaining a good attitude helps too. You quickly learn that things will rarely go as you plan when working abroad, and many of the technological and other comforts we rely on in our legal practices here in the US are often unavailable when you’re overseas. Additionally, having to navigate the social and cultural norms of the people and places where you’re doing an investigation (and the fact that you’re often operating in an environment where the people you’re investigating may resent you and try to make your life more difficult), can make the mechanics of actually conducting the investigation as complex as the substantive issues you’re investigating. You also won’t regret developing a habit of over-preparing and over-thinking, so that when you and your group face an unexpected issue, you have already considered it, or at least have the foundation to think your way through it. Finally, learn the law backwards and forwards. When I started working in this area, one of the attorneys who mentored me told me that he always kept the statute handy and referred to it often, because the answers he was looking for were usually found inside. In practice, I’ve more often than not found this to be true. At a minimum, having a solid working knowledge of the law and its intricacies helps you communicate with your clients about why you may be offering certain advice or asking them to make certain changes to how they do business.