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Survey Says …

Survey Results

The OECD recently released this study titled “Corporate Anti-corruption Compliance Drivers, Mechanisms and Ideas for Change.” The study largely relies on results of a survey “to better understand the extent to which companies are currently motivated to take measures to prevent and detect bribery and other forms of corruption in their business dealings.”

The survey size was very small (only 130 survey respondents – largely individuals in a legal or compliance role in their companies – with the U.S. having the most respondents – with the largest number of respondents in the healthcare industry). As a result the survey was not representative as even the report recognized: “a company that does not have a compliance program probably would not have an interest in participating in a study of such program – thus it is important to remember that the percentage of respondents who indicated that their companies have such a program is not at all indicative of the percentage of overall companies in the world that have such programs.”

Even as to this survey group, as highlighted below several survey responses caught my eye and call into question whether “soft” enforcement of the FCPA (and related laws) has been successful (see here for the article “Has the FCPA Been Successful in Achieving Its Objectives”) or whether compliance can best be incentivized with a compliance defense (see here for the article “Revisiting an FCPA Compliance Defense”).

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Sargeant Marine Cements $16.6 FCPA Resolution With DOJ Regarding Bribery Schemes In Brazil, Venezuela, And Ecuador

Sargeant Marine

Earlier this week, the DOJ announced that Sargeant Marine Inc. (SMI – an asphalt company based in Florida) “pleaded guilty and agreed to pay $16.6 million to resolve foreign bribery charges stemming from conduct by the company and its employees and agents in Brazil, Venezuela and Ecuador.”

The total criminal penalty was actually $90 million, but because of SMI’s “inability to pay” the settlement amount was only $16.6 million.

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Foreign Lawyers Are Third Parties Too

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Companies doing business in the global marketplace engage all types of third parties. Generally, Foreign Corrupt Practices Act compliance tends to focus, with good reason, on third parties such as agents, representatives, distributors and others that assist a company in obtaining or retaining business.

However, given the DOJ and SEC’s broad interpretation of that element of the FCPA’s anti-bribery provisions, any third party that has a point of contact with foreign officials – even if outside the context of foreign government procurement – can potentially expose a business organization to scrutiny and enforcement.

This includes foreign lawyers as the recent FCPA enforcement action against various individuals associated with adoption agency European Adoption Consultants once again highlights. Indeed, in this enforcement action a foreign lawyer herself was charged with FCPA violations – although it remains to be seen whether the jurisdictional basis will be challenged.

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DOJ Returns To Ugandan Bribery Scheme To Bring Additional Individual Charges

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As highlighted in this prior post, in August 2019 the DOJ announced that Robin Longoria (an individual associated with European Adoption Consultants – an Ohio-based adoption agency) pleaded guilty to one count of conspiring to violate the FCPA’s anti-bribery provisions and to commit wire fraud and visa fraud “for her role in a scheme to corruptly facilitate adoptions of Ugandan children through bribing Ugandan officials and defrauding U.S. adoptive parents and the U.S. Department of State.”

Yesterday, the DOJ announced additional individual FCPA criminal charges, among others, in connection with the same Ugandan bribery scheme.

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For The First Time In Nearly Six Years, The DOJ Issues An 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.

As highlighted below, last week (for the first time since November 2014) the DOJ issued an opinion procedure release.

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