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Friday Roundup


Checking in with Firtash, what the …?, if only it were that simple, and for the reading stack.

It’s all here in the Friday roundup.

Checking In With Firtash

As highlighted in this prior post, in April 2014 the DOJ announced the unsealing of a criminal indictment charging six individuals “with participating in an alleged international racketeering conspiracy involving bribes of state and central government officials in India to allow the mining of titanium minerals.” Among the defendants was high-profile Ukrainian businessman Dmitry Firtash.

After paying the largest bail bond in Austrian history — $174 million — Firtash has been living under house arrest for the past eight years in a Vienna compound, as he fights extradition to the U.S.

Firtash was recently interviewed by NBC News about Russia’s invasion of Ukraine. According to the article:

“He says he spends his time now focusing on providing logistics support for supplies in Ukraine and working with four other oligarchs to provide public service television programming with the help of the Zelenskyy administration. One channel focuses on war information for Ukrainians, and a Russian-speaking channel run out of Poland targets the Russian people. He says as much as 15 percent of his workforce has left to fight the Russians, and eight of his employees have died.”

What The …?

This recent article in Treasury & Risk titled “How to Fight Cultures of ‘Bribes’ to Keep Corruption at Bay,” asserts:

The Biden administration “has retooled the Foreign Corrupt Practices Act (FCPA) by forcing companies to check that their compliance programs are correctly implemented and updated. […] This regulation imposes harsher sanctions than others on any company involved—voluntarily or involuntarily—in acts of corruption.”

Such incredibly false and misleading statements.

How does stuff like this actually get published?

If Only It Were That Simple

The UN Global Compact asserts that a company can “eliminate corruption” with six steps: commit, assess, define, implement, measure, and communicate.

That’s funny.

If only it were that simple.

For The Reading Stack

Several FCPA enforcement actions, including most recently Stericycle, have concerned conduct in Argentina and the alleged bribery of Argentine officials.

This article asks why the alleged officials are never punished. “Individuals are not prosecuted and the proceeds of crime are not recovered.”

The most recent edition of the always informative FCPA Update from Debevoise & Plimpton had this to say about the recent Roger Ng trial and conviction (see here for the prior post).

“Aside from being one of the most high-profile cases to go to trial in the past couple of years, Ng’s case is notable as one of the relatively rare examples of a trial involving an individual charged with FCPA violations. But it is most noteworthy for being the first trial involving an individual charged with conspiracy to violate the internal accounting controls provisions of the FCPA.

Although the government prevailed at the trial court and Ng’s conviction was upheld, the government’s interpretation of the internal controls provisions of the FCPA will continue to be tested as the case is reviewed on appeal. And whatever the appellate court’s decision, it will serve as a seminal case. If the appeals court also agrees with the government’s interpretation of “circumvention” and the scope of the meaning of internal accounting controls, it is likely that the DOJ will be emboldened in bringing similar charges against individuals, including in instances where there is no option of charging the anti-bribery provisions of the FCPA.

The Ng trial also presents a guiding example of the type of company policies that individuals with compliance obligations must be well-informed of and adhere to, as – at present – it can form the basis of a criminal charge. Policies that may not have an obvious outward connection to the FCPA, such as one that lays out a team’s deal process, may well still be squarely in scope. This reflects a growing discourse in the breadth, reach, and appropriateness of the use of employer policies, which are fundamentally contractual agreements, in the course of criminal proceedings, a trend that is not limited to the interpretation of the FCPA.

Finally, the case highlights an imbalance that may arise in charging and settlement documents involving both corporate and individual charges. Ng was charged with conspiracy to circumvent Goldman’s internal accounting controls, yet Goldman’s DPA involved no such charge. Additionally, Ng circumvented Goldman controls that the SEC found to be inadequate in the first place.40 According to the SEC’s Order, Goldman’s approval processes for the commitment of firm capital in large transactions did not include adequate documentation of the committee’s processes, due diligence, and follow-up regarding concerns raised about the bond deals.41 This precedent demonstrates that even if a company has a system that is not sufficient to catch the requisite red flags, an individual nevertheless may be found guilty of at least conspiring to circumvent such insufficient controls.”

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