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DOJ Issues An FCPA Opinion Procedure Release

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The Foreign Corrupt Practices Act when enacted directed the DOJ Attorney General to establish a procedure to provide responses to specific inquiries by those subject to the FCPA concerning conformance of their conduct with the DOJ’s “present enforcement policy.”

Pursuant to the governing regulations of the so-called DOJ Opinion Procedure Release Program, only “specified, prospective—not hypothetical—conduct” is subject to a DOJ opinion.  While the DOJ’s opinion has no precedential value, its opinion that contemplated conduct conforms with the FCPA is entitled to a rebuttable presumption should an FCPA enforcement action be brought as a result of the contemplated conduct.

Recently, the DOJ issued this opinion procedure release (dated October 25, 2023). It is only the fourth FCPA opinion procedure release since 2014.

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Judge Denies Bankman-Fried’s Motion To Dismiss FCPA Charge Holding That “The Indictment Sufficiently Pleads The Business Nexus Element”

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In December 2022, the Department of Justice announced criminal charges against Samuel Bankman-Fried arising from an “alleged wide-ranging scheme by [him] to misappropriate billions of dollars of customer funds deposited with FTX, the international cryptocurrency exchange [he] founded …, and mislead investors and lenders to FTX and to Alameda Research, the cryptocurrency hedge fund [he] also founded.”

Specifically, Bankman-Friend was charged with conspiracy to commit wire fraud, wire fraud, conspiracy to commit commodities fraud, conspiracy to commit securities fraud, conspiracy to commit money laundering, and conspiracy to defraud the Federal Election Commission and commit campaign finance violations.

As highlighted in this prior post, in March 2023 the DOJ filed a superseding indictment adding a Foreign Corrupt Practices Act conspiracy charge to the criminal charges Bankman-Fried is facing.

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In Response To Bankman-Fried’s Motion To Dismiss, DOJ Says That The FCPA Charges Are Good Enough For Now

bankman-Fried

In December 2022, the Department of Justice announced criminal charges against Samuel Bankman-Fried arising from an “alleged wide-ranging scheme by [him] to misappropriate billions of dollars of customer funds deposited with FTX, the international cryptocurrency exchange [he] founded …, and mislead investors and lenders to FTX and to Alameda Research, the cryptocurrency hedge fund [he] also founded.”

Specifically, Bankman-Friend was charged with conspiracy to commit wire fraud, wire fraud, conspiracy to commit commodities fraud, conspiracy to commit securities fraud, conspiracy to commit money laundering, and conspiracy to defraud the Federal Election Commission and commit campaign finance violations.

As highlighted in this prior post, in March 2023 the DOJ filed a superseding indictment adding a Foreign Corrupt Practices Act conspiracy charge to the criminal charges Bankman-Fried is facing.

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Bankman-Fried Seeks Dismissal Of FCPA Charge

bankman-Fried

In December 2022, the Department of Justice announced criminal charges against Samuel Bankman-Fried arising from an “alleged wide-ranging scheme by [him] to misappropriate billions of dollars of customer funds deposited with FTX, the international cryptocurrency exchange [he] founded …, and mislead investors and lenders to FTX and to Alameda Research, the cryptocurrency hedge fund [he] also founded.”

Specifically, Bankman-Friend was charged with conspiracy to commit wire fraud, wire fraud, conspiracy to commit commodities fraud, conspiracy to commit securities fraud, conspiracy to commit money laundering, and conspiracy to defraud the Federal Election Commission and commit campaign finance violations.

As highlighted in this prior post, in March 2023 the DOJ filed a superseding indictment adding a Foreign Corrupt Practices Act conspiracy charge to the criminal charges Bankman-Fried is facing.

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An Informative Read

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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.

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