FCPA / Anti-Corruption

On June 1, 2020, the US Department of Justice (DOJ) Criminal Division, with little fanfare, issued updated guidance on the Evaluation of Corporate Compliance Programs (2020 Guidance). The document, which was released without any accompanying public announcement or explanation, updates an April 30, 2019 version of the document (2019 Guidance), as discussed in our May 9, 2019 Advisory. The 2019 Guidance updated original guidance published by the Division’s Fraud Section on February 8, 2017 (2017 Guidance), as discussed in our 2017 FCPA Mid-Year Review.

The DOJ’s evaluation of the effectiveness of a company’s compliance program continues to be a relevant factor to charging decisions under the Principles of Federal Prosecution of Business Organizations in the Justice Manual, as well as to an organization’s eligibility to receive a reduction in criminal fines calculated under the US Sentencing Guidelines (USSG); it is also important to the DOJ’s assessment of whether a monitor is warranted.


Continue Reading Client Advisory: DOJ Updates Corporate Compliance Program Guidance, Emphasizes Role of Data

On April 29, 2020, the European Commission announced plans to develop a legislative proposal by 2021 that will require EU companies to conduct mandatory human rights and environmental due diligence on their operations and global supply chains. If passed, the new law would also include provisions for corporate liability with possible sanctions imposed for non-compliance.

The announcement follows the publication of a study conducted for the European Commission which focused on the due diligence requirements to identify, prevent, mitigate and account for abuses of human rights, including the rights of the child and fundamental freedoms, serious bodily injury or health risks, and environmental damage including with respect to climate. The announcement comes as part of wider efforts across the European Union to prevent human rights abuses and protect vulnerable workers.


Continue Reading Client Alert: Calls for European Companies to Focus on Human Rights Abuses in Supply Chain

On May 20, 2020, panelists from the DOJ, SEC, and FBI participated in a virtual town hall to discuss the state of play of FCPA and healthcare fraud enforcement as the United States and the rest of the world navigate the wide-ranging challenges wrought by the Covid-19 pandemic.

Government panelists included:

  • Robert Zink (Chief of the Fraud Section, Criminal Division, DOJ);
  • Daniel Kahn (current Senior Deputy Chief of the Fraud Section, and former FCPA Unit Chief, DOJ);
  • Joe Beemsterboer (current Senior Deputy Chief of the Fraud Section, and former Chief of the Health Care Fraud Unit, DOJ);
  • Charles Cain (Chief of the FCPA Unit of the SEC’s Division of Enforcement); and
  • Leslie Bakschies (Unit Chief at the FBI).

Key takeaways from the town hall discussion include:

  • Government investigations and multi-lateral cooperation continue, supported by remote investigative tools. All of the panelists confirmed that both ongoing and new investigations continue.  The U.S. Government, like private companies, has been affected by Covid-19-related travel restrictions, shutdowns (including of courts in some districts, delaying trials and grand juries), and other remote-work constraints.  But panelists emphasized that they are able to continue much of their investigative work.  This includes, for example, issuing subpoenas and other document requests, reviewing document submissions, and communicating with counsel.  Ms. Bakschies noted that the FBI is also obtaining search and arrest warrants through remote conferences with judges, and finding other “creative ways” around impediments.  The agencies also continue to collaborate with their counterparts outside the United States to move forward, de-conflict, and resolve cases.


Continue Reading Key Investigation and Compliance Take-Aways from May 20, 2020 DOJ, SEC, and FBI Joint Town Hall Discussing FCPA and Healthcare Fraud Enforcement Efforts During Covid-19 Emergency

The ink may barely be dry on (most) Member States’ national legislation transposing the EU’s Fifth Anti-Money Laundering Directive but the European Commission is pressing ahead with ever-more ambitious plans to tackle money laundering and terrorism financing with the aim of ensuring EU anti-money laundering laws are enforced consistently across all Member States.  On 7 May, the Commission adopted a new action plan, together with a parallel public consultation, with a view to delivering on the proposed actions by early 2021.

The new action plan is built on six specified pillars:

  • Effective implementation of existing rules;
  • A single EU rulebook;
  • EU-level supervision;
  • A support and cooperation mechanism for financial intelligence units;
  • Better use of information to enforce criminal law; and
  • A stronger EU in the world.


Continue Reading Trust, but Supervise – European Commission Sets Out New AML/CTF Action Plan

With the world economy significantly affected by the COVID-19 pandemic, many companies are struggling to survive and facing an acute need to retain existing business and obtain new business. This puts pressure on their business and marketing teams. As a result, proper management of the anti-corruption risks associated with business hospitality is even more important to avoid possible breach of applicable anti-bribery laws such as the US Foreign Corrupt Practices Act (FCPA).

Business hospitality, including gifts, meals, entertainment, transportation, lodging and per diems, that legitimately promotes cordial business relations or demonstrates a company’s products or services is a normal part of business relationships across the globe. However, business hospitality that improperly influences the behavior of the recipient to obtain or retain business advantages may result in actual or perceived anti-corruption violations, causing economic as well as reputational damage to the company. So, what are the things to look at when reviewing business hospitality expenses? This blogpost provides some practical advice to in-house legal and compliance professionals on the review and approval of business hospitality expenses.


Continue Reading Risk Management for Business Hospitality–The Basics

As the outbreak of the coronavirus (COVID-19) pandemic continues globally, multinational companies and individuals are joining the fight against the virus, donating money and medical supplies, and providing necessary services. However, when making these charitable donations, either domestically or globally, companies should consider appropriate anti-corruption compliance procedures under applicable anti-bribery laws such as the US Foreign Corrupt Practices Act to ensure the donation is used for the intended charitable purpose.  Any donation should be carried out in an open and transparent fashion, be based on fair and objective criteria, be accurately and completely documented, and be consistent in all respects with the principles of the company’s code of conduct and anti-corruption policies.

Some practical compliance safeguards include:

  • Donations should be made only to recipients that can be relied upon to use the donation in the legitimate manner intended by your company;
  • Donations should be described accurately and in reasonable detail in the books and records of your company; and
  • Donations that improperly or disproportionately benefit a public official or other recipient who has regulatory oversight over or who can improperly influence your company’s business should not be made.


Continue Reading Anti-Corruption Compliance for Charitable Donations—The Basics

On February 26, 2020, the U.S. District Court for the District of Connecticut partially overturned the jury conviction of Lawrence Hoskins in United States v. Hoskins, acquitting the defendant of all Foreign Corrupt Practices Act (FCPA) counts.  In doing so, the court found that the government had failed to demonstrate as a matter of law that Hoskins, a British citizen, had acted as an “agent” of Alstom Power Inc. (“API”), a US-based subsidiary of French multinational corporation Alstom S.A. (“Alstom”), and a “domestic concern” for purposes of FCPA jurisdiction.  This ruling is the latest twist in a case that has dealt a series of blows to the DOJ’s expansive assertion of FCPA jurisdiction over foreign defendants. As described below, however, the DOJ still has a number of tools available to prosecute non-US defendants involved in foreign corruption.

Continue Reading The FCPA’s Arm Remains Long: Recent Developments in FCPA Jurisdiction over Non-US Defendants

Click here to read the full Client Advisory by Steptoe.

On January 23, 2020, Transparency International published its 2019 Corruption Perceptions Index (CPI),  which measures perceptions of public sector corruption in 180 countries. Viewed together with the 2019 TRACE Bribery Risk Matrix,  which also includes private sector corruption, the Asia Pacific (APAC)

Click here to read the full Client Advisory by Steptoe.

Of the record-breaking USD 2.9 billion in fines imposed by US authorities in 2019 for violations of the Foreign Corrupt Practices Act (FCPA), almost 95% involved Asia Pacific, primarily China and India, but also Indonesia, Vietnam, Thailand, and South Korea.

This year, the US