FCPA Professor will once again be the place to visit in January for a plethora of 2020 year in review statistics. But first, this post closes out the fourth quarter of 2020.
For a similar post from Q1 2020 see here, for Q2 2020 see here and for Q3 2020 see here.
DOJ Enforcement (Corporate)
The DOJ brought four corporate FCPA enforcement action in the fourth quarter. Actual DOJ recovery in these actions was approximately $1.5 billion.
J&F Investimentos (Oct. 14th)
See here and here for prior posts.
Charges: Conspiracy to violate the FCPA’s anti-bribery provisions.
Resolution Vehicle: Plea Agreement
Guidelines Range: $284.9 million – $569.9 million
Settlement: Net $128.2 million (pursuant to the plea agreement J&F will also pay $128.2 million to Brazilian authorities).
Origin: Brazil law enforcement action
Monitor: No
Individuals Charged: No
Goldman Sachs (Oct. 22nd)
See here, here, here and here for prior posts.
Charges: As to Goldman Sachs, conspiracy to violate the FCPA’s anti-bribery provisions; as to Goldman Sachs (Malaysia) Sdn. Bhd., conspiracy to violate the FCPA’s anti-bribery provisions.
Resolution Vehicle: As to Goldman Sachs, deferred prosecution agreement; as to Goldman Sachs (Malaysia), plea agreement.
Guidelines Range: $2.57 billion to $5.14 billion
Settlement: Net $1.262 billion (after accounting for credits and offsets for related foreign law enforcement actions).
Origin: DOJ investigation in the aftermath of related Malaysia and other international law enforcement investigations related to 1Malaysia Development Bhd. or 1MDB.
Monitor: No
Individuals Charged: Yes
Beam (Oct. 27th)
See here and here for prior posts.
Charges: Conspiracy to violate the FCPA’s anti-bribery, books and records, and internal controls provisions.
Resolution Vehicle: Deferred prosecution agreement.
Guidelines Range: $21.7 to $43.5 million
Settlement: $19.6 million
Origin: The enforcement action concerned the same core conduct as the SEC’s 2018 enforcement action against the company. In that enforcement action, the SEC stated that the company voluntarily disclosed. However, in the DOJ enforcement action, the DOJ stated: “the Company did not receive voluntary disclosure credit … because it did not timely disclose to the DOJ.”
Monitor: No
Individuals Charged: No
Vitol (Dec. 3rd)
See here, here, and here for prior posts.
Charges: Two counts of conspiracy to violate the FCPA’s anti-bribery provisions.
Resolution Vehicle: Deferred prosecution agreement.
Guidelines Range: $180 – $360 million
Settlement: Net $90 million (after accounting for credits and offsets for related U.S. and foreign law enforcement actions).
Origin: Brazil law enforcement action.
Monitor: No
Individuals Charged: Yes (in connection with a portion of the conduct at issue, in September 2020 the DOJ criminally charged Javier Aguilar – see here).
DOJ Enforcement (Individual)
The DOJ brought or announced two core enforcement action involving three individuals in the fourth quarter.
As highlighted here, Deck Won Kang (a U.S. citizen who controlled two closely held companies with principal places of business in New Jersey) pleaded guilty to a criminal information charging him with one count of violating the FCPA’s anti-bribery provisions for a bribery scheme in which he paid bribes to a high-ranking official in the Korean Navy and a procurement official for the Defense Acquisition Program Administration – a state-owned and state-controlled agency within South Korea’s Ministry of National Defense.
As highlighted here, in connection with the Sargeant Marine enforcement action the DOJ brought additional criminal charges against father-son Jorge and Bruno Luz.
SEC Enforcement (Corporate)
The SEC brought two corporate FCPA enforcement actions in the fourth quarter. SEC recovery in these actions was $426.8 million.
J&F Investimentos (Oct. 14th)
See here and here for prior posts.
Charges: None (administrative order finding causation of violations of the FCPA’s books and records and internal controls provisions)
Settlement: $26.8 million in disgorgement
Origin: Brazil law enforcement action
Individuals Charged: Yes
Related DOJ Enforcement Action: Yes
Goldman Sachs (Oct. 22nd)
See here, here, here and here for prior posts.
Charges: None (administrative order findings violations of the FCPA’s anti-bribery, books and records and internal controls provisions)
Settlement: Net $400 million civil penalty (after accounting for credits and offsets for related foreign law enforcement actions).
Origin: SEC investigation in the aftermath of related Malaysia and other international law enforcement investigations related to 1Malaysia Development Bhd. or 1MDB.
Individuals Charged: Yes
Related DOJ Enforcement Action: Yes
SEC Enforcement (Individual)
In connection with its enforcement action against J&F, the SEC also found that executives Joesley Batista and Wesley Batista caused violations of the FCPA’s books and records and internal controls provisions and that the individuals: (i) knowingly circumvented or knowingly failed to implement a system of internal accounting controls and knowingly falsified books and records; and (ii) made materially false or misleading statements or omissions to an accountant or auditor. (See here). Both individuals agreed to each pay a civil penalty of $550,000.
Other Developments or Items of Interest
As highlighted in this post, certain SEC Commissioners hit a home run in objecting to the SEC’s internal controls theory of enforcement. This post details how certain SEC Commissioners observed that anti-corruption policy is outside the SEC’s area of expertise.
The OECD released its Phase 4 review of the United State’s implementation of the OECD Anti-Bribery Convention … in effect a review of the FCPA, its enforcement, and related issues. (See here). This post discusses how the report nicely captures why comparing FCPA enforcement to other nation’s enforcement of “FCPA-like laws” is absurd.
As highlighted in this post, FCPA “tips” continue to be a minor component of the SEC’s whistleblower program.
In a rare FCPA appellate decision, the Second Circuit affirmed Chi Ping Patrick Ho’s FCPA and related convictions (See here).
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