Interesting, across the pond, non-profit scrutiny, and for the reading stack. It’s all here in the Friday roundup.
The DOJ’s FCPA’s Corporate Enforcement Policy states:
“When a company has voluntarily self disclosed misconduct in an FCPA matter, fully cooperated, and timely and appropriately remediated … there will be a presumption that the company will receive a declination absent aggravating circumstances involving the seriousness of the offense or the nature of the offender. Aggravating circumstances that may warrant a criminal resolution include, but are not limited to, involvement by executive management of the company in the misconduct; a significant profit to the company from the misconduct; pervasiveness of the misconduct within the company; and criminal recidivism.”
Since the CEP was released in November 2017, there has been one so-called declination with disgorgement. (See here for the matter involving Insurance Corporation of Barbados Limited (ICBL). Related to the above paragraph, the DOJ stated in the ICBL letter agreement that the misconduct involved “high-level” corporate officers.
Across the Pond
Lisa Osofsky (the new director of the U.K. Serious Fraud Office) recently delivered this speech and stated that: “We’ve gotten a succession of DPAs under our belts in the UK. It is no longer a US only phenomenon. And DPAs are spreading across the globe.”
Elsewhere in her speech, Osofsky said the following regarding DPAs:
“When considering resolutions short of trial (for example, DPAs), we must analyse whether the company has a credible and colourable defence under Section 7 (Adequate Procedures). Has the company engaged in proactive efforts to clean house and to reform? Has the company instilled the right controls? Are these backed by demonstrable commitment at the appropriate level? The SFO will want assurance that companies are doing everything they can to ensure the crimes of the past won’t be repeated long after the watchful eye of the prosecutor moves on to another target.”
Related to the U.K.’s nascent use of DPAs, this report highlights criticism in the U.K. regarding the lack of individual prosecutions in connection with DPAs.
If you are a frequent reader of these pages, this issue will sound familiar as the lack of individual prosecutions in connection with DPAs (and other alternative forms of resolution) has been frequently highlighted on these pages (see e.g. here). In fact, I talked about this issue in my 2010 Senate testimony and this article “Measuring the Impact of NPAs and DPAs on FCPA Enforcement” is mostly about this concerning issue.
Given the obtain or retain business element in the FCPA’s anti-bribery provisions, can a non-profit violate the FCPA? The issue was addressed in this prior post. Regardless of the answer, this recent Toronto Sun article reports:
“[Tides Foundation] wired $55,000 to the bank account of an Indian chief in Northern Alberta, paying him to oppose the oilsands.
How is it acceptable that a foreign lobby group can simply deposit cash into a bank account of a Canadian politician? Who else is being paid cash to oppose the oilsands? This fact almost escaped detection. It was buried in the Tides Foundation’s 138-page filing with the IRS, who only disclosed it to get a tax break. Even then, it was shrouded in secrecy. The money was paid to a numbered company, 850450 Alberta Ltd. Only a search of Alberta’s corporate registry revealed that 850450 Alberta Ltd. was owned by another company, called Acden Group Ltd., that had changed its name twice in the past four years. Adam and other band politicians were directors and shareholders, in trust for the band.”
For the Reading Stack
This Gibson Dunn alert highlights a decision earlier this week by Court of Appeal of England and Wales in The Director of the Serious Fraud Office and Eurasian Natural Resources Corporation Limited regarding the privileged nature of documents created in the context of an internal investigation. As stated in the alert:
“The Court of Appeal reversed the High Court’s decision and found that all of the interviews conducted by ENRC’s external lawyers [in a bribery investigation] were covered by litigation privilege, and so too was the work conducted by the forensic accountancy advisors for the books and records review. The Court of Appeal found that ENRC did in fact reasonably contemplate prosecution when the documents were created.”
For additional reading, see here from Debevoise.
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