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Former Och-Ziff Executives To Mount A Defense Against SEC’s FCPA (And Related) Claims

By on January 27, 2017 in 2017 Enforcement Actions, Individual Enforcement Action, Michael Cohen, Och-Ziff Capital, Och-Ziff Capital Management, SEC Enforcement Action, Vanja Baros
fightback

I am not suggesting that the following is a very meaningful statistic, but it is a fact: there has been more FCPA enforcement in the first week of the Trump administration than the first week of the Obama administration.

But then again “assigning” to the Trump administration yesterday’s SEC enforcement action against Michael Cohen and Vanja Baros (former Och-Ziff executives) based on the same core conduct as the DOJ and SEC’s September 2016 enforcement action against Och-Ziff is foolish just as it is foolish to “assign” FCPA enforcement in the first months (indeed the first year) of the Obama administration to the Obama Administration.

Yesterday’s enforcement action is not surprising as it was fairly obvious (as detailed in this prior post) that the main actors in the Och-Ziff matter were Cohen and Baros (even though not specifically named in the September 2016 resolution documents).

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SEC Director Of Enforcement Ceresney On …

By on December 2, 2016 in Anything of Value, Daniel Och, Enforcement Agency Policy, Enforcement Agency Speeches, Financial Services Industry, Foreign Law Enforcement Cooperation, Harris Corporation, Hiring Family Members of Foreign Officials, Individual Enforcement Action, Industry Sweeps, Internal Controls, JPMorgan, Och-Ziff Capital, SEC, Voluntary Disclosure
Ceresney

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.

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Issues To Consider From The Och-Ziff Enforcement Action

By on October 11, 2016 in DOJ FCPA “Pilot Program”, Foreign Official, Gray Cloud, Internal Controls, Och-Ziff Capital, Och-Ziff Capital Management, Related Civil Litigation
Issues

Previous posts here and here went in-depth into the recent Foreign Corrupt Practices Act enforcement action against Och-Ziff, Daniel Och and Joel Frank.

This post continues the analysis by highlighting additional issues to consider. As highlighted below, embedded in the approximately 175 pages of resolution documents were several notable issues.

Time Line

According to Och-Ziff’s prior disclosures “beginning in 2011, and from time to time thereafter, we have received subpoenas from the SEC and requests for information from the U.S. Department of Justice (the “DOJ”) in connection with an investigation involving the FCPA and related laws.”

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Friday Roundup

By on October 7, 2016 in Angola, Charitable Contributions, Collateral Effects, Country Exits, Dan Gertler, Double Standard, Electrobras, Embraer, Hiring Family Members of Foreign Officials, McDonald’s, Och-Ziff Capital, Och-Ziff Capital Management, Siemens, Wal-Mart
Roundup

Scrutiny alerts and updates, ripples, difficult business conditions, resource alerts, and for the reading stack. It’s all here in the Friday roundup.

Scrutiny Alerts and Updates

Wal-Mart

Bloomberg reports:

“Wal-Mart Stores Inc. is butting heads with the U.S. government over how to wrap up a long-running foreign corruption investigation. Officials have proposed that the world’s biggest retailer pay at least $600 million to resolve probes by the Justice Department and the Securities and Exchange Commission into whether it bribed government officials in markets from Mexico to India and China, according to three people familiar with the matter. The retailer has rebuffed the government’s request, two of them said.

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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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