This post highlighted the recent $78.1 million Foreign Corrupt Practices Act enforcement action against Tenaris (the second time the company has resolved an FCPA enforcement action in the last approximate decade).
This post highlights additional issues to consider from the enforcement action.
Timeline
Tenaris “voluntarily notified” the SEC and DOJ of the matters involved in the enforcement action in October 2016.
Tired of reading about the Foreign Corrupt Practices Act?
Well, sometimes I get tired writing about the FCPA.
Thus, today’s post is this link to a recent episode of the In-House Warrior podcast. During the podcast, I speak to Richard Levick about the following FCPA topics: how compliance professionals need to gain comfort with FCPA uncertainty; FCPA enforcement during a Biden administration; whether the FCPA has been successful in achieving its objectives; what the “b” word (bribery) means; and how corporate risk aversion is, in part, part of the reason for the current FCPA enforcement landscape.
Pursuant to various securities laws rules and regulations, issuers are required to disclose risks in various required filings.
With increasing frequency, such risk disclosures take up several pages and often serve as little more than defensive disclosures to guard against opportunistic plaintiffs’ counsel who may allege securities fraud if the issuer did not disclose to investors obvious risks that may impact the company.
For instance, this recent 10-K filing of Nova Lifestyle Inc. (a California-based furniture company) contains approximately 35 risk factors including the following obvious risks:
The FCPA Flash podcast provides in an audio format the same fresh, candid, and informed commentary about the Foreign Corrupt Practices Act and related topics as readers have come to expect from written posts on FCPA Professor.
This FCPA Flash episode is a conversation with James Noe (special counsel with Jones Walker LLP who previously served in various in-house counsel and executive roles with several oil and gas companies). During the podcast, Noe discusses: the easiest and most difficult aspects of FCPA compliance in the oil and gas industry; the extent of facilitating payments in the industry; whether oil and gas companies are too risk averse when it comes to FCPA issues; and civil actions by industry participants when business is lost because of a refusal to make bribe payments.
It is always interesting when the Foreign Corrupt Practice Act is mentioned during investor conference calls. The comments tend to be off-the-cuff (not scripted as much FCPA content is) which make them great.
For instance, during a recent investor call an executive from CF Industries Holdings (an Illinois based manufacturer and distributor of agricultural fertilizers with a largely North American footprint) was asked by an investor:
“What are the next stages of capital deployment, especially as the market is now relatively more stable? Do you still feel industry consolidation is necessary? And just generally, what do you see as your own potential role in the process? And should we limit our thinking to North America?”
The company’s President, CEO and Director responded:
