Foreign Corrupt Practices Act enforcement, it’s not just about the DOJ.
Granted, as a civil enforcement agency the SEC’s sticks are less sharp than the DOJ’s, but the SEC also claims a significant piece of the FCPA enforcement pie (query whether it should – but that is a subject for another day – for instance as discussed in “The Story of the Foreign Corrupt Practices Act” the SEC wanted no part in enforcing the FCPA’s anti-bribery provisions and in recent years an SEC Commissioner stated that anti-corruption policy is not within the SEC’s area of expertise nor further to the SEC’s mission – see here).
This post goes in-depth into various facts and figures relevant to SEC FCPA enforcement in 2021. Compared to prior years, this year in review post and the statistics therein (like many from 2021) are less than enlightening given the small number of corporate enforcement actions in 2021.
[See here for a similar post for 2020 here for a similar post for 2019; here for a similar post for 2018; here for a similar post for 2017; here for a similar post for 2016; here for a similar post for 2015; here for a similar post for 2014; here for a similar post for 2013; here for a similar post for 2012; here for a similar post for 2011; and here for a similar post for 2010].
Settlement Amounts and Specifics
In 2021, the SEC brought 4 corporate enforcement actions and collected approximately $171 million in those enforcement actions. (Note: this figure – as well as certain historical figures below – represent net FCPA settlement amounts after accounting for various credits or deductions in certain enforcement actions for related law enforcement actions).
Of note, in only 2 enforcement actions (Amec Foster Wheeler and WPP) did the SEC find that the company violated the FCPA’s anti-bribery provisions.
By way of comparison:
- in 2020 the SEC collected approximately $683 million in 8 corporate enforcement actions;
- in 2019 the SEC collected approximately $1.03 billion in 13 corporate enforcement actions;
- in 2018 the SEC collected approximately $382 million in 14 corporate FCPA enforcement actions;
- in 2017 the SEC collected approximately $289 million in 7 corporate FCPA enforcement actions;
- in 2016 the SEC collected approximately $1.07 billion in 24 corporate FCPA enforcement actions;
- in 2015 the SEC collected approximately $114.8 million in 9 corporate FCPA enforcement actions;
- in 2014 the SEC collected approximately $327 million in 7 corporate FCPA enforcement actions;
- in 2013 the SEC collected approximately $300 million in 8 corporate enforcement actions;
- in 2012 the SEC collected approximately $118 million in 8 corporate FCPA enforcement actions;
- in 2011 the SEC collected approximately $148 million in 13 corporate FCPA enforcement actions; and
- in 2010 the SEC collected approximately $530 million in 19 corporate FCPA enforcement actions.
The range of SEC FCPA enforcement actions in 2021 was on the high end $99 million (Credit Suisse) and on the low end $10.1 million (Amec Foster Wheeler).
Of the 4 corporate enforcement actions brought by the SEC in 2021, 2 (50%) were SEC only from an FCPA standpoint. (Note: in connection with the SEC’s Credit Suisse FCPA enforcement action, the DOJ also brought an action that did not involve FCPA charges).
By way of comparison, of the 8 corporate enforcement actions brought by the SEC in 2020, 4 (50%) were SEC only; of the 13 corporate enforcement actions brought by the SEC in 2019, 6 (46%) were SEC only; of the 14 corporate enforcement actions brought by the SEC in 2018, 9 (64%) were SEC only; of the 7 corporate enforcement actions brought by the SEC in 2017, 4 (58%) were SEC only and of the 24 corporate enforcement actions brought by the SEC in 2016, 14 (58%) were SEC only.
Of the 4 corporate enforcement actions brought by the SEC in 2021, 4 (100%) were administrative actions. In other words, there was no judicial scrutiny of SEC corporate FCPA enforcement actions in 2021. By way of comparison:
- 100% of SEC corporate FCPA enforcement actions in 2020 were administrative actions;
- 92% of SEC corporate FCPA enforcement actions in 2019 were administrative actions;
- 100% of SEC corporate FCPA enforcement actions in 2018 were administrative actions;
- 100% of SEC corporate FCPA enforcement actions in 2017 were administrative actions;
- 83% of SEC corporate FCPA enforcement actions in 2016 were administrative actions;
- 89% of SEC corporate FCPA enforcement actions in 2015 were administrative actions;
- 86% of SEC corporate FCPA enforcement actions in 2014 were administrative actions ; and
- 50% of SEC corporate FCPA enforcement actions in 2013 were administrative actions .
In 2021,the SEC collected approximately $142 million in disgorgement and prejudgment interest in enforcement actions that did not charge or find anti-bribery violations. This is noteworthy because many question, and rightfully so, whether disgorgement is an appropriate remedy in cases that do not charge FCPA anti-bribery violations. See here for a prior post on so-called “no-charged bribery disgorgement” cases.
By way of comparison:
- in 2020 the SEC collected approximately $256 million in disgorgement and prejudgment interest in no-charged bribery disgorgement cases;
- in 2019 the SEC collected approximately $183 million in disgorgement and prejudgment interest in no-charged bribery disgorgement cases;
- in 2018 the SEC collected approximately $171 million in disgorgement and prejudgment interest in no-charged bribery disgorgement cases;
- in 2017 the SEC collected approximately $2 million in disgorgement and prejudgment interest in no-charged bribery disgorgement cases;
- in 2016 the SEC collected approximately $73 million in disgorgement and prejudgment interest in no-charged bribery disgorgement cases;
- in 2015 the SEC collected approximately $45 million in disgorgement and prejudgment interest in no-charged bribery disgorgement cases;
- in 2014 the SEC collected approximately $104 million in disgorgement and prejudgment interest in no-charged bribery disgorgement cases;
- in 2013, the SEC collected approximately $208 million in disgorgement and prejudgment interest in no-charged bribery disgorgement cases;
- in 2012, the SEC collected approximately $57.4 million in disgorgement and prejudgment interest in no-charged bribery disgorgement cases; and
- in 2011 the SEC collected approximately $51 million in disgorgement and prejudgment interest in n0-charged bribery disgorgement cases.
The $171 million million the SEC collected in 2021 corporate enforcement actions breaks down as follows:
- approximately $98 million in disgorgement and prejudgment interest; and
- approximately in $73 million in civil penalties
In other words, approximately 57% of SEC corporate FCPA settlement amounts in 2021 consisted of disgorgement and prejudgment interest.
By way of comparison:
- in 2020, 40% of SEC corporate FCPA settlements consisted of disgorgement and prejudgment interest [Note: the Goldman enforcement action consisted of a $400 million civil penalty – by far the largest civil penalty ever imposed in an FCPA enforcement action];
- in 2019, 88% of SEC corporate FCPA settlements consisted of disgorgement and prejudgment interest;
- in 2018, 92% of SEC corporate FCPA settlements consisted of disgorgement and prejudgment interest;
- in 2017, 82% of SEC corporate FCPA settlements consisted of disgorgement and prejudgment interest;
- in 2016 96% of SEC FCPA settlements consisted of disgorgement and prejudgment interest;
- in 2015 51% of SEC FCPA settlements consisted of disgorgement and prejudgment interest;
- in 2014 99% of SEC FCPA settlement amounts in 2014 consisted of disgorgement and prejudgment interest;
- in 2013 98% of SEC FCPA settlement amounts consisted of disgorgement and prejudgment interest;
- in 2012 86% of SEC FCPA settlement amounts consisted of disgorgement and prejudgment interest;
- in 2011, 94% of SEC FCPA settlement amounts consisted of disgorgement and prejudgment interest; and
- in 2010, 96% of SEC FCPA settlement amounts consisted of disgorgement and prejudgment interest.
Corporate vs. Individual Actions
Of the 4 SEC FCPA enforcement actions in 2021, 0 (0%) have involved, at present, related SEC FCPA charges or findings against company employees. Stated differently, 100% of SEC corporate FCPA enforcement actions in 2021 lacked any related SEC charges or findings against company employees.
By way of comparison:
- of the 8 corporate SEC FCPA enforcement actions from 2020, 3 (38%) involved related SEC charges or findings against company employees;
- of the 13 corporate SEC FCPA enforcement actions from 2019, 2 (15%) involved related SEC charges or findings against company
- of the 14 corporate SEC FCPA enforcement actions from 2018, 1 (7%) involved related SEC charges or findings against company employees;
- of the 7 corporate SEC FCPA enforcement actions from 2017, 1 (14%) involved related SEC charges or findings against company employees;
- of the 24 corporate SEC FCPA enforcement actions from 2016, 7 (29%) involved related SEC charges or findings against company employees;
- in 2015 of the 9 corporate SEC FCPA enforcement actions 2 (22%) involved related SEC charges or findings against company employees;
- in 2014 of the 7 corporate SEC FCPA enforcement actions, 0 (0%) involved related SEC charges or findings against company employees;
- in 2013 of the 8 SEC corporate FCPA enforcement actions 0 (0%) involved related SEC charges or findings against company employees;
- in 2012, of the 8 SEC corporate FCPA enforcement actions 0 (0%) involved related SEC charges or findings against company employees;
- in 2011, of the 13 SEC corporate FCPA enforcement actions 2 (15%) involved related SEC charges or findings against company employees; and
- in 2010, of the 19 SEC corporate FCPA enforcement actions 3 (15%) involved related SEC charges or findings against company employees.
Voluntary Disclosures
Of the 4 SEC corporate FCPA enforcement actions from 2021, 0 (0%) appear to be the result of a voluntary disclosure.
By way of comparison:
- of the 8 corporate SEC FCPA enforcement actions from 2020, 3 (38%) were the result of voluntary disclosure;
- of the 13 corporate SEC FCPA enforcement actions from 2019, 6 (46%) were the result of voluntary disclosure;
- of the 14 corporate SEC FCPA enforcement actions from 2018, 6 (43%) were the result of voluntary disclosure;
- of the 7 corporate SEC FCPA enforcement actions from 2017, 1 (14%) was the result of voluntary disclosure;
- of the 24 corporate SEC FCPA enforcement actions from 2016, 8 enforcement actions (33%) were the result of corporate voluntary disclosures;
- of the 9 corporate SEC FCPA enforcement actions from 2015, 3 enforcement actions (33%) were the result of corporate voluntary disclosures;
- of the 7 corporate SEC FCPA enforcement actions from 2014, 4 enforcement actions (57%) were the result of corporate voluntary disclosures;
- of the 8 corporate SEC FCPA enforcement actions in 2013, 3 enforcement actions (38%) were the result of corporate voluntary disclosures;
- of the 8 corporate SEC FCPA enforcement actions in 2012 4 (50%) were the result of corporate voluntary disclosures; and
- of the 13 corporate SEC FCPA enforcement actions in 2011 11 (85%) were the result of corporate voluntary disclosures.
This remainder of this post provides an overview of SEC FCPA enforcement in 2021.
Deutsche Bank (Jan. 8th)
See here and here for prior posts.
Charges: None (administrative order findings violations of the FCPA’s books and records and internal controls provisions)
Settlement: $43 million
Origin: Not specified in the resolution documents
Individuals Charged: No
Related DOJ Enforcement Action: Yes
Amec Foster Wheeler (June 25)
See here and here for prior posts.
Charges: None (administrative order findings violations of the FCPA’s ant-bribery, books and records and internal controls provisions)
Settlement: Net $10.1 million (after credits for related foreign law enforcement actions)
Origin: Requests for information from the DOJ/SEC
Individuals Charged: No
Related DOJ Enforcement Action: Yes
WPP (Sept. 24th)
See here and here for prior posts.
Charges: None (administrative order findings violations of the FCPA’s ant-bribery, books and records and internal controls provisions)
Settlement: $19.2 million ($10.1 million in disgorgement, $1.1 million in prejudgment interest, and an $8 million penalty)
Origin: Unclear from the resolution documents
Individuals Charged: No
Related DOJ Enforcement Action: No
Credit Suisse (Oct. 19th)
See here for the prior post.
Charges: None (administrative order finding violations of the FCPA’s books and records and internal controls provisions – as well as other securities law violations)
Settlement: $99 million ($34 million in disgorgement and prejudgment interest and a civil penalty of $65 million).
Origin: Unclear from the resolution documents (but not a voluntary disclosure)
Individuals Charged: No
Related DOJ Enforcement Action: Yes in 2019 various individuals were charged were FCPA offenses (see here). In October 2021 the DOJ brought a related enforcement action against Credit Suisse, but did not charge FCPA offenses (see here).
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