A “foreign official.”
Without one, there can be no FCPA anti-bribery violation (civil or criminal). Who were the alleged “foreign officials” of 2019?
This post highlights the alleged “foreign officials” from 2019 corporate DOJ and SEC FCPA enforcement actions.
There were 14 core FCPA enforcement actions in 2019. Of the 14 actions, 8 (57%) involved, in whole or in part, employees of alleged state-owned or state-controlled entities (“SOEs).
By way of comparison:
- in 2018, 53% of corporate enforcement actions involved, in whole or in part, employees of alleged SOEs (see here).
- in 2017, 54% of corporate enforcement actions involved, in whole or in part, employees of alleged SOEs (see here)
- in 2016, 78% of corporate enforcement actions involved, in whole or in part, employees of alleged SOEs (see here);
- in 2015, 55% of corporate enforcement actions involved, in whole or in part, employees of alleged SOEs (see here);
- in 2014 60% of corporate enforcement actions involved, in whole or in part, employees of alleged SOEs (see here);
- in 2013, 77% of corporate enforcement actions involved, in whole or in part, employees of alleged SOEs (see here);
- in 2012, 42% of corporate enforcement actions involved, in whole or in part, employees of alleged SOEs (see here at pages 348-353);
- in 2011, 81% of corporate enforcement actions involved, in whole or in part, employees of alleged SOEs (see here at pages 29-41);
- in 2010, 60% of corporate FCPA enforcement actions involved, in whole or in part, employees of alleged SOEs (see here at pages 108-119); and
- in 2009, 66% of corporate FCPA enforcement actions involved, in whole or in part, employees of alleged SOEs (see here at pages 410-44).
In 2014, in an issue of first impression for an appellate court, the 11th Circuit set forth a control and function test for whether an alleged SOE can be “instrumentality” under the FCPA such that its employees are “foreign officials” under the FCPA. As highlighted here and more extensively in my Supreme Court amicus brief supporting the cert petition, there were many flaws in the 11th Circuit’s reasoning. The Supreme Court declined to hear the case. As to whether Congress intended employees of SOEs to be “foreign officials” under the FCPA, see here for my “foreign official” declaration.
The remainder of this post describes (as per DOJ/SEC allegations) the “foreign officials” of 2019. As is apparent from the descriptions below, in certain instances the enforcement agencies describe the “foreign official” with reasonable specificity (sometimes even “naming names”). In other instances there is virtually no specificity as to the alleged “foreign officials.”
[Note: as in prior years, certain of the enforcement actions below technically only involved FCPA books and records and/or internal control charges or findings. In fact, of the 13 corporate FCPA enforcement actions brought by the SEC in 2019, six (Telefonica, Walmart, Microsoft, Deutsche Bank, Juniper Networks and Barclays) “merely” found violations of the FCPA’s books and records and internal controls provisions. As most readers know, actual charges in many FCPA enforcement actions hinge on voluntary disclosure, cooperation, collateral consequences, and other non-legal element issues. Thus, even if an FCPA enforcement action is resolved without FCPA anti-bribery charges, most such actions remain very much about the “foreign officials” involved – a fact evident when reading the actual enforcement action.
Cognizant Technology Solutions
SEC
Licensing and permitting officials in India.
MTS
DOJ
Gulnara Karimova – described as “a family member of the former President of Uzbekistan and was herself an Uzbek government official. She had influence over decisions made by UzACI, the regulatory authority governing telecommunications in Uzbekistan and held an ownership interest in Uzdunrobita through Swisdorn Ltd.”
SEC
Same
Fresenius
DOJ
Physicians and other healthcare personnel in Angola, Saudi Arabia, Morocco, Spain, Turkey, Gabon, Benin, Burkina Faso, Senegal, Ivory Coast, Niger, Cameroon China, Serbia, Bosnia, and Mexico. Additional reference to an Angolan Military Health Officer described as a high-ranking officer in the Medical Services Division of the Angolan Armed Forces.
SEC
Same including additional reference to the chief nephrologist at two state owned military hospitals in Morocco.
Telefonica Brasil
SEC
Various Brazil officials including federal congressmen and senators, mayors, and other government officials including an ambassador
Walmart
DOJ
Licensing and permitting officials in Brazil
SEC
Licensing and permitting officials in Brazil, Mexico, India and China
Technnip FMC
DOJ
Individuals associated with Petrobras (a Brazil based state-owned or state-controlled enterprise, individuals associated with the Brazil Workers’ Party Workers’ Party political candidates
Individuals associated with the South Oil Company (an Iraqi based state-owned or state-controlled enterprise), individual associated with the Iraq Ministry of Oil
SEC
Individuals associated with the South Oil Company (an Iraqi based state-owned or state-controlled enterprise), individual associated with the Iraq Ministry of Oil
Microsoft
DOJ
Generic references to government officials in Hungary
SEC
Generic references to government officials in Hungary as well as Saudi Arabia, Thailand and Turkey
Deutsche Bank
SEC
Individuals associated with Chinese and Russian state-owned or state-controlled enterprises as well as a Deputy Minister at a Russian government entity
Juniper Networks
SEC
Individuals associated with Russian and Chinese state-owned or state-controlled enterprises
Quad Graphics
SEC
Individuals associated with the Peruvian National Institute of Statistics and Information and other government municipalities and the Ministry of Education
Judges in Peru
Employees of Chinese state-owned or state-controlled enterprises
Barclays
SEC
Employees of Chinese and Korean state-owned or state-controlled enterprises
Westport Fuel Systems
SEC
Employee of a Chinese state-owned or state-controlled enterprise
Samsung Heavy Industries
DOJ
Employees of Petrobas (a Brazil based state-owned or state-controlled oil and gas company)
Ericsson
DOJ
Government officials in the executive branch of the Djibouti government who had influence over decisions made by a state-owned telecommunications company. The CEO of a state-owned telecom company
Employees of a state-owned telecommunications companies in China, Vietnam,
SEC
Same as above, in addition employees of a state-owned telecommunications company in Saudi Arabia.
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