This FCPA Blog post opines on the “three most important FCPA stories of 2017.” However, as highlighted in this post the opinion for the reason for the increase in individual prosecutions is misguided and lacking in any factual support.
The FCPA Blog post states: “More individuals held accountable. First under the Pilot Program, and now under the new DOJ guidance, companies are trying to qualify for cooperation credit. That puts more attention than ever on the individuals actually responsible for the overseas bribery. The fruits of the policy were evident in 2017.”
Yes, as highlighted below there were more DOJ individual FCPA enforcement actions announced or brought in 2017 compared to prior years.
DOJ Individual FCPA Enforcement Actions (2007 – 2017)
| Year | Individuals Charged With Criminal FCPA Offenses
|
| 2017 | 18 |
| 2016 | 8 |
| 2015 | 8 |
| 2014 | 10 |
| 2013 | 12 |
| 2012 | 2 |
| 2011 | 10 |
| 2010 | 33
(including 22 in the Africa Sting case) |
| 2009 | 18 |
| 2008 | 14 |
| 2007 | 7 |
However, contrary to the suggestion by the FCPA Blog, there is nothing to suggest that any of the 2017 individual FCPA enforcement actions brought or announced were causally related to the April 2016 FCPA Pilot Program or the November 2017 DOJ “FCPA Corporate Enforcement Policy.”
Indeed, a quick review of the circumstances surrounding these individual enforcement actions demonstrates that the FCPA blog opinion is misguided and lacking in any factual support.
2017 DOJ Individual FCPA Enforcement Actions Brought Or Announced
| Individual | Employer / Former Employer | Relevant Background
|
| Juan Hernandez
Charles Beech Fernando Ardila |
Associated with various privately-held energy companies
|
Enforcement actions are related to the December 2015 DOJ enforcement action against various individuals in connection with PDVSA projects.
No evidence that the originating enforcement action had anything to do with the April 2016 FCPA Pilot Program or November 2017 FCPA Corporate Enforcement Policy. |
| Joo Hyun Bahn
Ban Ki Sang San Woo |
A commercial real estate project involving Keangnam Enterprises Co. Ltd
|
No evidence that the enforcement action had anything to do with the April 2016 FCPA Pilot Program or November 2017 FCPA Corporate Enforcement Policy. |
| Joseph Baptiste | Haitian focused non-profit | As stated by the DOJ, the enforcement action originated from an undercover sting operation.
No evidence that the enforcement action had anything to do with the April 2016 FCPA Pilot Program or November 2017 FCPA Corporate Enforcement Policy. |
| Keith Barnett
Andreas Kohler James Finley Aloysius Zuurhout Petros Contoguris |
Rolls Royce | Enforcement action related to the Rolls-Royce corporate enforcement action in which the DOJ stated:
“The Company did not voluntarily or timely disclose [to the DOJ], as the Company’s disclosures occurred only after media reports first alleging corruption by the Company and the U.K. Serious Fraud Office initiated an inquiry into the Company’s misconduct, and as a result the Company was not eligible for voluntary disclosure credit.” No evidence that the enforcement action had anything to do with the April 2016 FCPA Pilot Program or November 2017 FCPA Corporate Enforcement Policy. |
| Anthony Mace
Robert Zubiate |
SBM Offshore | Related to the SBM Offshore corporate enforcement action.
Relevant background is as follows. In 2014 SBM Offshore resolved a $240 million Dutch law enforcement action alleging bribery schemes in Equatorial Guinea, Angola and Brazil between 2007 through 2011. In connection with that action, SBM Offshore disclosed: “the United States Department of Justice has informed SBM Offshore that it is not prosecuting the Company and has closed its inquiry into the matter.” In the 2017 enforcement action, the DOJ stated: “The Fraud Section informed the Company in 2016 that it was reopening the investigation because the Fraud Section learned additional information that was not uncovered during the Company’s investigation, and not known to either the Company or the Fraud Section at the time of the declination; specifically, that a United States-based executive of one of SBM’s wholly-owned domestic concerns managed a significant portion of the corrupt scheme, and engaged in conduct within the jurisdiction of the United States.” No evidence that the enforcement action had anything to do with the April 2016 FCPA Pilot Program or November 2017 FCPA Corporate Enforcement Policy. |
| Chi Ping Patrick Ho
Cheikh Gadio |
Associated with China Energy Fund Committee, CEFC China Energy Company Limited
|
No evidence that the enforcement action had anything to do with the April 2016 FCPA Pilot Program or November 2017 FCPA Corporate Enforcement Policy. |
| Colin Steven
|
Embraer | Related to the 2016 enforcement action against Embraer.
The Embraer enforcement action began, in the words of the company, as follows: “In September, 2010, we received a subpoena from the Securities and Exchange Commission, or SEC, and associated inquiries from the U.S. Department of Justice, or DOJ, concerning possible non-compliance with the U.S. Foreign Corrupt Practice Act, or FCPA, in relation to certain aircraft sales outside of Brazil.” No evidence that the enforcement action had anything to do with the April 2016 FCPA Pilot Program or November 2017 FCPA Corporate Enforcement Policy. |
| Jeffrey Chow | Keppel Offshore & Marine | Related to the 2017 enforcement action against Keppel. As stated by the company, its scrutiny began in July 2016 when its former agent in Brazil Zwi Skornick gave testimony “in connection with the ongoing Lava Jato investigations” in Brazil.
No evidence that the enforcement action had anything to do with the April 2016 FCPA Pilot Program or November 2017 FCPA Corporate Enforcement Policy. |
Further relevant to how misguided the FCPA Blog post is the fact (as highlighted in this prior post) that the DOJ has self-identified seven matters as being resolved consistent with its 2016 FCPA Pilot Program.
Yet, not one of these matters have involved related DOJ charges against a company employee.
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