Sep. 18, 2019

SFO Guidance Moves Toward Transparency but Offers No Guarantees

One of the most challenging aspects of deciding whether to cooperate with enforcement authorities in a corruption investigation is the uncertainty of the benefits that cooperation will provide in a settlement. In the U.S., the SEC and DOJ have taken significant steps to reassure companies that cooperating will lead to better results. Until now, the U.K. Serious Fraud Office (SFO) had been mostly quiet, but the agency recently took a significant step towards transparency by issuing a document titled Corporate Co-operation Guidance. The Anti-Corruption Report spoke with U.K. practitioners to find out what companies need to know about the new Guidance. In this first article we look at the Guidance’s utility and how it compares to the DOJ’s Corporate Enforcement Policy (CEP). In a future article, we will explore some of the specific cooperation requirements in the Guidance. See “Osofsky’s American Dream for the SFO” (Feb. 20, 2019).

Deutsche Bank Nepotism Settlement Shows Policies Are Not Enough

Deutsche Bank has agreed to pay disgorgement and a civil penalty to the SEC to resolve allegations that it hired the relatives of government officials in China and Russia in order to land big deals. The German bank has had policies in place to prevent this type of nepotism but senior executives were able to creatively use joint ventures and lax lateral hiring rules to skirt those policies. We take a close look at this failure of compliance execution and extract lessons for companies. See “Checklist of Issues to Consider When Implementing a Hiring Practices Policy” (Jun. 1, 2016).

DOJ Pursuit of Individuals for Corruption in Venezuela Highlights Risk of Doing Business There

The U.S. government’s announcements this summer regarding enforcement actions taken against a half-dozen individuals, including former Venezuelan officials, for allegedly corrupt acts in Venezuela seem to signal both continued turmoil in the country, ongoing risk in transacting business there and coordinated efforts by U.S. agencies in addressing the problems. Then, on August 5, 2019, President Trump issued blocking sanctions against Venezuela, complicating the landscape further. We take a look at recent developments in Venezuelan enforcement and analyze the risks for companies considering transacting business there. See our two-part series on recent anti-corruption enforcement in Venezuela: “What to Expect in the PDVSA Investigation and How Companies Should Respond” (May 1, 2019) and “U.S. Enforcement Efforts Against Venezuela State-Owned Oil Company PDVSA” (Apr. 17, 2019).

Washing Away the Stains of Corruption: Self-Cleaning in Danish Public Procurement Law

Denmark usually prides itself on being one of the least corrupt countries in the world. However, in early summer of 2015, this self-image was challenged when Atea A/S, the Danish subsidiary of the Norwegian IT hardware supplier Atea ASA, came under investigation for bribery. After an investigation and conviction, the company was facing a four-year ban from government contracts. However, through a so-called “self-cleaning” process, the company was able to avoid the consequences of a conviction for corruption. In a guest article, Tormod Tingstad and Mads Peder Brøchner Jespersen of the law firm Kammeradvokaten/Poul Schmith in Copenhagen, Denmark, explain the process that ultimately led to the conclusion that Atea had demonstrated its reliability. See “Examining Transparency International’s 24th Annual Corruption Perception Index: Key Critiques and Takeaways” (Apr. 03, 2019).

A Guide to Recent Prosecutions Related to the PetroEcuador Scandal

While Brazil’s Operation Carwash was grabbing headlines across the world and unraveling corruption throughout Latin America, another corruption scandal, with similar far-reaching consequences but much less fanfare, was unfolding in Ecuador relating to its state-owned oil company PetroEcuador. Since 2016, Ecuador has initiated dozens of investigations against individuals and secured 16 convictions, and the DOJ’s investigation into the scandal has netted eight guilty pleas. In a guest article, James Tillen, a member at Miller Chevalier, and Nicole Gökçebay, an associate at the firm, break down the cases and the scandal’s enforcement implications. See “Bolsonaro Nepotism Allegations Upend Brazilian Corruption Investigations” (Aug. 7, 2019).

Vinson & Elkins Gains Veteran FCPA Partner in New York

Palmina Fava’s practice focuses on drafting and implementing compliance programs and defending corporations and individuals in government investigations and litigation, with an emphasis on FCPA investigations. For more from Vinson & Elkins, see “Lessons in Self-Reporting and Cooperation From the Walmart Settlement” (Aug. 7, 2019).

King & Spalding Welcomes Former FBI Chief Back to D.C.

Following nearly two years at the FBI, Zack Harmon will resume his FCPA practice. He has previously defended clients in dozens of high-profile investigations and enforcement proceedings by U.S. and foreign regulators, including the DOJ, SEC and the U.K.’s SFO. For more insight from Harmon, see “Top FCPA Officials Discuss How International Cooperation and Individual Prosecutions Are Reshaping Anti-Corruption Enforcement, the Defense Bar Responds” (Dec. 13, 2017).

NYU PCCE Announces New Executive Director

Alicyn Cooley has joined New York University’s Program on Corporate Compliance and Enforcement as executive director. She previously served as Deputy Chief of the Business and Securities Fraud Section at the United States Attorney’s Office in the Eastern District of New York. For coverage of an NYU PCCE program, see “Top SEC Officials Put Mr. and Ms. 401K at the Forefront but Say No Big Changes to Enforcement to Come” (Sep. 20, 2017).