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Approximately 4.5 Years After The Enforcement Action, The SEC Orders Frank To Pay A $35,000 Civil Penalty

By on March 18, 2021 in Joel Frank, Och-Ziff Capital, Och-Ziff Capital Management, SEC Enforcement Action
Joelfrank

In September 2016, in connection with certain of the same core conduct alleged in the Och-Ziff Foreign Corrupt Practices Act enforcement action, the SEC also released an administrative order finding that (see here for the prior post) Daniel Och (CEO and Chairman of Och-Ziff) was a cause of certain of the company’s FCPA books and records violations and that Joel Frank (CFO – pictured) was a cause of certain of the company’s FCPA books and records and internal controls violations.

Without admitting or denying the SEC’s findings, Och agreed to pay approximately $2.2 million and Frank likewise agreed to resolve the action without admitting or denying the SEC’s findings and the SEC stated that and “a penalty will be assessed against him at a future date.”

Oddly, it took approximately 4.5 years, but earlier this week the SEC ordered that Frank pay a $35,000 civil penalty.

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In Depth Into The Och-Ziff FCPA Enforcement Action

By on October 2, 2016 in 2016 Enforcement Actions, Anything of Value, Chad, Charitable Contributions, Congo, Cooperation, Dan Gertler, Daniel Och, DOJ Enforcement Action, Due Diligence, Financial Services Industry, Foreign Official, Internal Controls, Joel Frank, Libya, Michael Cohen, Monitor, Niger, Och-Ziff Capital, Och-Ziff Capital Management, Resource Extraction Industry, SEC Enforcement Action, Third Parties, Travel and Entertainment, Vanja Baros
och ziff

Last week, the DOJ and SEC announced (here and here) a Foreign Corrupt Practices Act enforcement action against Och-Ziff Capital Management Group (and a related entity) for improper business practices in various African countries. The aggregate settlement amount was $412 million (a $213 million DOJ criminal penalty and a $199 million SEC resolution consisting of disgorgement and prejudgment interest), the 4th largest FCPA settlement amount of all-time.

As highlighted in this previous post, the SEC also found Daniel Och (CEO) and Joel Frank (CFO) culpable for certain of the improper conduct. As indicated in the post, this represents what is believed to be the first time in FCPA history that the SEC also found the current CEO and CFO of the issuer company liable, to some extent, for company FCPA violations. Moreover, the $2.2 million Och agreed to pay, without admitting or denying the SEC’s findings, is the largest settlement amount in FCPA history by an individual in an SEC action.

Whether the Och-Ziff enforcement action is the “first time a hedge fund has been held to account for violating the FCPA” (as the DOJ stated in its release) is a debatable point. (See here for the 2007 FCPA enforcement action on the DOJ’s FCPA website against hedge fund Omega Advisors).

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SEC Brings Historic FCPA Enforcement Action Against Daniel Och (CEO And Chairman Of Och-Ziff) and Joel Frank (CFO)

By on September 29, 2016 in 2016 Enforcement Actions, Daniel Och, Executive Enforcement Action, Individual Enforcement Action, Joel Frank
Daniel Och

In connection with the $412 million Foreign Corrupt Practices Act enforcement action against Och-Ziff (the 4th largest of all-time – stay tuned for additional coverage as original source documents become available), the SEC also found that Daniel Och (CEO and Chairman of Och-Ziff – pictured) was a cause of certain of the company’s FCPA books and records violations and that Joel Frank (CFO) was a cause of certain of the company’s FCPA books and records and internal controls violations.

This represents, what is believed to be, the first time in FCPA history that the SEC also found the current CEO and CFO of the issuer company liable for company FCPA violations.

Without admitting or denying the SEC’s findings, Och agreed to pay approximately $2.2 million ($1,900,000 – reflecting his estimated share of gain to Och-Ziff resulting from the transactions with a Democratic Republic of Congo Partner and $273,718 in prejudgment interest). The $2.2 million Och agreed to pay is the largest settlement amount in FCPA history by an individual in an SEC action.

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