This recent post highlighted SEC Foreign Corrupt Practices Act enforcement against issuers in 2023.
Today’s post focuses on the other FCPA enforcement agency – the Department of Justice – and highlights various facts and figures relevant to DOJ FCPA enforcement in 2023 against business organizations. (See here for a similar post from 2022; here for a similar post from 2021; here for a similar post from 2020; here for a similar post from 2019; here for a similar post from 2018; here from 2017, here from 2016, here from 2015, here from 2014, here from 2013, here from 2012, here from 2011, and here from 2010).
Settlement Numbers and Amounts
In 2023, the DOJ brought 7 corporate enforcement actions.
By comparison:
- in 2022 the DOJ brought 7 corporate enforcement actions;
- in 2021 the DOJ brought 2 corporate enforcement actions;
- in 2020 the DOJ brought 8 corporate enforcement actions;
- in 2019 the DOJ brought 8 corporate enforcement actions;
- in 2018 the DOJ brought 8 corporate enforcement actions;
- in 2017 the DOJ brought 9 corporate enforcement actions;
- in 2016 the DOJ brought 13 corporate enforcement actions;
- in 2015 the DOJ brought 2 corporate enforcement actions;
- in 2014 the DOJ brought 7 corporate enforcement actions;
- in 2013 the DOJ brought 7 corporate enforcement actions;
- in 2012 the DOJ brought 9 corporate enforcement actions;
- in 2011 the DOJ brought 11 corporate enforcement actions;
- in 2010 the DOJ brought 17 corporate enforcement actions.
(Note: these figures use the “core” approach to FCPA statistics – see here for the prior post – an approach also endorsed by the DOJ – see here).
In the 7 corporate FCPA enforcement actions from 2023, the DOJ collected approximately $252 million.
(Note: this figure represents net FCPA settlement amounts after accounting for various credits or deductions in certain related law enforcement actions (either domestic or foreign) or inability to pay in certain instances).
By comparison:
- in the 7 corporate enforcement actions from 2022, the DOJ collected approximately $652 million;
- in the 2 corporate enforcement actions from 2021, the DOJ collected approximately $87.2 million;
- in the 8 corporate enforcement actions from 2020, the DOJ collected approximately $2.10 billion;
- in the 8 corporate enforcement actions from 2019, the DOJ collected approximately $1.62 billion;
- in the 8 corporate enforcement actions from 2018, the DOJ collected approximately $618 million;
- in the 8 corporate enforcement actions from 2017, the DOJ collected approximately $845 million;
- in the 13 corporate enforcement actions from 2016, the DOJ collected approximately $1.17 billion;
- in the 2 corporate enforcement actions from 2015, the DOJ collected approximately $24.2 million;
- in the 7 corporate enforcement actions from 2014, the DOJ collected approximately $1.25 billion;
- in the 7 corporate enforcement actions from 2013, the DOJ collected approximately $420 million;
- in the 9 corporate enforcement actions from 2012, the DOJ collected approximately $142 million;
- in the 11 corporate enforcement actions from 2011, the DOJ collected approximately $355 million;
- in the 17 corporate enforcement actions from 2010, the DOJ collected approximately $870 million;
Corporate DOJ FCPA enforcement in 2023 ranged from $114.8 million (Albemarle) to $406,000 (Lifecore).
Corporate v. Individual Prosecutions
In the 7 corporate DOJ enforcement actions in 2023, 2 (28%) have resulted, at present, in any related DOJ FCPA charges.
Stay tuned for future posts specifically about DOJ individual FCPA enforcement actions in 2023 and historically.
Resolution Vehicles
The 7 corporate FCPA enforcement actions by the DOJ in 2023 involved: 4 deferred prosecution agreements; 2 so-called declinations with disgorgement; and 1 non prosecution agreement. Thus, 100% of DOJ corporate FCPA enforcement in 2023 involved, an alternative resolution vehicle not subjected to any meaningful judicial scrutiny.
By comparison:
- in 2022, 86% of DOJ corporate enforcement actions involved alternative resolution vehicles;
- in 2021, 100% of DOJ corporate enforcement actions involved alternative resolution vehicles;
- in 2020, 75% of DOJ corporate enforcement actions involved alternative resolution vehicles;
- in 2019, 100% of DOJ corporate enforcement actions involved alternative resolution vehicles;
- in 2018, 100% of DOJ corporate enforcement actions involved alternative resolution vehicles;
- in 2017, 100% of DOJ corporate enforcement actions involved alternative resolution vehicles;
- in 2016 92% of DOJ corporate enforcement actions involved alternative resolution vehicles;
- in 2015 100% of DOJ corporate enforcement actions involved alternative resolution vehicles;
- in 2014 71% of DOJ corporate enforcement actions involved alternative resolution vehicles;
- in 2013, 100% of corporate DOJ enforcement actions involved alternative resolution vehicles;
- in 2012 100% of corporate DOJ enforcement actions involved alternative resolution vehicles;
- in 2011 82% of corporate DOJ enforcement actions involved alternative resolution vehicles;
- in 2010 94% of corporate DOJ enforcement actions involved alternative resolution vehicles.
Voluntary Disclosures
Of 7 DOJ corporate enforcement actions in 2023, 3 (43%) were the result of a voluntary disclosure.
By comparison:
- in 2022, 43% of DOJ corporate enforcement actions were the result of a voluntary disclosure;
- in 2021, 0% of DOJ corporate enforcement actions were the result of a voluntary disclosure;
- in 2020, 13% of DOJ corporate enforcement actions were the result of a voluntary disclosure;
- in 2019, 37% of DOJ corporate enforcement actions were the result of a voluntary disclosure;
- in 2018 25% of DOJ corporate enforcement actions were the result of a voluntary disclosure;
- in 2017 33% of DOJ corporate enforcement actions were the result of a voluntary disclosure;
- in 2016 38% of DOJ corporate enforcement actions were the result of a voluntary disclosure;
- in 2015, 50% of corporate FCPA enforcement actions were the result of a voluntary disclosure;
- in 2014, 29% of corporate FCPA enforcement actions were the result of a voluntary disclosures;
- in 2013, 57% of corporate FCPA enforcement actions were the result of a voluntary disclosure or the direct result of a related voluntary disclosure;
- in 2012, 78% of corporate FCPA enforcement actions were the result of a voluntary disclosure or casually related to previous voluntary disclosures;
- in 2011, 73% of corporate FCPA enforcement actions were the result of corporate voluntary disclosures.
Monitors
Of the 7 corporate FCPA enforcement actions in 2023, 0 (0%) resulted in a formal corporate monitor imposed by the DOJ.
By way of comparison:
- in 2022, 29% of corporate enforcement actions resulted in a formal corporate monitor;
- in 2021 0% of corporate enforcement actions resulted in a formal corporate monitor;
- in 2020 0% of corporate enforcement actions resulted in a formal corporate monitor;
- in 2019 50% of corporate enforcement actions resulted in a formal corporate monitor;
- in 2018 12% of corporate enforcement actions resulted in a formal corporate monitor;
- in 2017 33% of corporate enforcement actions resulted in a formal corporate monitor;
- in 2016 54% of corporate enforcement actions resulted in a formal corporate monitor;
- in 2015 50% of corporate enforcement actions resulted in a formal corporate monitor;
- in 2014 14% of corporate enforcement actions resulted in a formal corporate monitor;
- in 2013 57% of corporate enforcement actions resulted in a formal corporate monitor;
- in 2012 33% of corporate enforcement actions resulted in a formal corporate monitor;
- in 2011 9% of corporate enforcement actions resulted in a formal corporate monitor; and
- in 2010 41% of corporate enforcement actions resulted in a formal corporate monitor.
(Note: in certain enforcement actions the DOJ concluded that a formal monitor was unnecessary because the company already had monitoring requirements imposed upon it as a result of a related foreign law enforcement action).
This remainder of this post provides an overview of corporate DOJ FCPA enforcement in 2023.
Corsa Coal (March 8)
See here for the prior post.
Charges: N/A – declination with disgorgement letter refers to violations of the FCPA’s anti-bribery provisions.
Resolution Vehicle: declination with disgorgement letter.
Guidelines Range: N/A
Settlement: As stated in the letter, “the Government calculated that Corsa earned profits totaling approximately $32.7 million from the criminal scheme. Corsa, however, met its burden of establishing an inability to pay the full disgorgement of ill-gotten gains sought by the Government, despite agreeing that the amount was otherwise appropriate based on the law and the facts. Accordingly, Corsa agrees to disgorge $1,200,000.”
Origin: Voluntary disclosure.
Monitor: No
Individuals Charged: Yes
Corficolombiana / Grupo Aval (August 10)
See here and here for prior posts.
Charges: Conspiracy to violate the anti-bribery provisions.
Resolution Vehicle: Criminal information charges resolved through a deferred prosecution agreement.
Guidelines Range: $58 – $116 million
Settlement: Net $20.3 million (after credits for related foreign law enforcement settlements).
Origin: Foreign law enforcement investigation.
Monitor: No
Individuals Charged: No
Albemarle (September 29)
See here for the prior post.
Charges: Conspiracy to violate the anti-bribery provisions.
Resolution Vehicle: Non-prosecution agreement.
Guidelines Range: The NPA does not contain a guidelines range.
Settlement: Net $114.8 million (after credits for related matters and other issues).
Origin: Voluntary disclosure.
Monitor: No
Individuals Charged: No
Lifecore (November 16)
See here and here for prior posts.
Charges: N/A – declination with disgorgement letter refers to violations of the FCPA’s anti-bribery provisions.
Resolution Vehicle: declination with disgorgement letter.
Guidelines Range: N/A
Settlement: As stated in the letter: “Lifecore further agrees that the financial benefit fairly attributable to the bribery conduct, i.e., the costs Lifecore avoided paying that were associated with needed on-site wastewater treatment as well as duties that otherwise would have been due and payable to Mexican regulatory authorities, was $1,286,060 USD. Because Lifecore has already incurred $879,555 USD in expenses by constructing a wastewater treatment plant and paying Mexican regulators the duties it owed, Lifecore agrees to disgorge the remaining amount of costs avoided, i.e., $406,505 USD.”
Origin: Voluntary disclosure.
Monitor: No
Individuals Charged: No
Tysers (November 20)
See here and here for prior posts.
Charges: Conspiracy to violate the FCPA’s anti-bribery provisions.
Resolution Vehicle: Deferred prosecution agreement.
Guidelines Range: $48 million to $96 million.
Settlement: As stated in the DPA: “a penalty in the amount of $36,000,000, which reflects a discount of 25 percent off of the bottom of the otherwise-applicable U.S. Sentencing Guidelines fine range, and forfeiture of $10,589,275.”
Origin: The company previously disclosed: “AUB is aware that the United Kingdom’s Serious Fraud Office (SFO) has an ongoing investigation into suspicions of bribery and corruption in relation to the conduct of business in Ecuador between 2013 and 2017 by Integro Insurance Brokers Limited, its employees, agents and associated persons, and also into any associated money laundering, and that the U.S. Department of Justice (DOJ) also has an ongoing investigation in relation to this conduct. Integro Insurance Brokers Limited is a company within the Tysers group. AUB understands Tysers was notified by the SFO and DOJ of the investigations in May 2020 and October 2020 respectively and that Tysers has been cooperating with the SFO and DOJ since being notified.” Likely an extension of prior enforcement actions concerning Ecuador’s Seguros Sucre S.A. (“Seguros Sucre”), an alleged state-owned insurance company and “instrumentality” of the Ecuadorian government. For instance, in 2022 U.K.-based reinsurance broker Jardine Lloyd Thompson Group Holdings Ltd. (JLT) resolved a $29 million FCPA enforcement action (see here for the prior post).
Monitor: No
Individuals Charged: No
H.W. Wood (November 20)
See here and here for prior posts.
Charges: Conspiracy to violate the FCPA’s anti-bribery provisions.
Resolution Vehicle: Deferred prosecution agreement.
Guidelines Range: $30 million to $60 million.
Settlement: As stated in the DPA: “The Fraud Section and the Company agree, based on the application of the Sentencing Guidelines, that the appropriate criminal penalty is $22,500,000. This reflects a 25 percent discount off the bottom of the Sentencing Guidelines fine range.” “The Company has made representations to the Fraud Section. and provided supporting evidence, that the Company has an inability to pay a $22,500,000 criminal penalty. Based on those representations, and an independent analysis verifying the accuracy of those representations conducted by the Fraud Section (with the assistance of a forensic accounting expert), the parties agree that a criminal penalty of $508,000 is appropriate.”
Origin: Likely an extension of prior enforcement actions concerning Ecuador’s Seguros Sucre S.A. (“Seguros Sucre”), an alleged state-owned insurance company and “instrumentality” of the Ecuadorian government. For instance, in 2022 U.K.-based reinsurance broker Jardine Lloyd Thompson Group Holdings Ltd. (JLT) resolved a $29 million FCPA enforcement action (see here for the prior post).
Monitor: No
Individuals Charged: No
Freepoint Commodities (December 14)
See here and here for prior posts.
Charges: Conspiracy to violate the FCPA’s anti-bribery provisions.
Resolution Vehicle: Deferred prosecution agreement.
Guidelines Range: $80 – $160 million.
Settlement: As stated in the DPA: “The Fraud Section and the Office and the Company agree, based on the application of the Sentencing Guidelines, that the appropriate criminal penalty is $68,000,000 (the “Criminal Penalty”). This reflects a 15 percent discount off the bottom of the Sentencing Guidelines fine range. The Company and the Fraud Section and the Office agrees that the Company will pay a monetary penalty in the amount of $45,560,000, equal to two-thirds of the Criminal Penalty, to the United States Treasury no later than ten business days after the Agreement is fully executed. The Fraud Section and the Office agree to credit toward the Criminal Penalty the amount paid by the Company to authorities in Brazil for violations of Brazilian law related to the same conduct … up to a maximum of $22,440,000 (the “Penalty Credit Amount”), within one year of the execution of this Agreement. Should any amount of the Penalty Credit Amount not be paid within twelve months of the execution of this Agreement, or be returned to the Company or any affiliated entity for any reason, the remaining balance of the Penalty Credit Amount will be paid to the United States Treasury within twelve months of the execution of this Agreement.” “The Company hereby admits that the facts … establish that at least $30,551,150, representing the proceeds traceable to the commission of the offense, is forfeitable to the United States. The Fraud Section and the Office agree that anticipated payments by the Company in connection with any concurrent resolution with the CFTC shall be credited against the Forfeiture Amount in the amount of $7,637,788 (the “Forfeiture Credit Amount”). Should any amount of the Forfeiture Credit Amount not be paid to the CFTC in connection with the Company’s resolution with the CFTC, the Company agrees that it shall make a payment of any remaining unpaid portion of the Forfeiture Credit Amount by wire transfer pursuant to instructions provided by the Fraud Section and the Office no later than 10 days after one year from the date of the Agreement.”
Origin: An extension of 2023 FCPA (and related) enforcement actions against individuals previously employed or associated with the company. The origins of the individual enforcement actions is unclear.
Monitor: No
Individuals Charged: Yes
