Mar. 18, 2020

Airbus: The Value of Cooperation

One of the common goals of both the DOJ’s Corporate Enforcement Policy and the SFO’s Co-Operation Guidance is to encourage companies to self-report corruption issues. But Airbus’ recent $3.9‑billion settlement with U.S., U.K. and French authorities shows that exemplary cooperation, even in the absence of a self-report, can earn a company substantial settlement credit. In this third and final article on the Airbus settlement, we take a close look at Airbus’ cooperation in the parallel investigations, what it did to fix its compliance issues, and how it was able to avoid an independent compliance monitor, despite failing to self-report and paying the largest criminal penalty for an anti-corruption issue in history. See “Airbus Case Marks a Milestone in International Anti‑Corruption Cooperation” (Feb. 19, 2020) and “Compliance Lessons From the Airbus Settlement” (Mar. 4, 2020).

A Risky Business Model in China Costs Cardinal Health $8.8M

Ohio-based healthcare company Cardinal Health has settled SEC charges claiming the company violated the FCPA’s internal controls and recordkeeping provisions for $8.8 million. According to the SEC’s order, a Chinese subsidiary acquired in 2010 regularly authorized and made improper payments to government officials through marketing accounts it maintained and operated for a customer. “The lesson from this is to do ABAC due diligence on acquisitions,” especially for U.S.-listed companies, said Susan Munro, a partner at Steptoe & Johnson in Beijing, “but this type of diligence is very important in any event.” See “Revisiting the China Initiative: Will the Focus on FCPA Prosecutions of Chinese Companies Produce Results?” (Jul. 10, 2019).

Anti-Corruption Developments in Central America: A Clear Path Forward?

The last several years have seen vast expansion of anti-corruption efforts across Mexico and South America. Central America, however, has lagged its neighbors to the north and south leading some to consider the narrow isthmus a “fly-over” region. A closer look, however, reveals a more complicated story. In a guest article, Alejandra Montenegro Almonte, Gregory W. Bates, and Chervonne Colón Stevenson, attorneys at Miller & Chevalier, review the recent anti-corruption efforts in Costa Rica, Guatemala, Honduras and El Salvador and assesses the short- and long-term impact of those efforts. See “A Guide to Recent Prosecutions Related to the PetroEcuador Scandal” (Sep. 18, 2019).

Hogan Report Finds Compliance Budgets Languishing but Risks Rising

Compliance teams are carrying heavier workloads even as budgets stagnate, Hogan Lovells’ second global survey on navigating bribery and corruption risk found. Compliance leaders expressed concern about entering higher risk markets as more jurisdictions enact anti-bribery and anti-corruption laws, and as international cooperation between enforcement authorities increases. “The survey results show that across industries, there is pressure to grow business, and that has led to companies investing in emerging markets,” Stephanie Yonekura, a Hogan Lovells partner, told the Anti-Corruption Report, adding that “Compliance officers are feeling pressure to enter these markets in spite of the risks related to bribery and corruption.” See “An International Take on the State of Compliance” (May 15, 2019).

Business Considerations for Responding to the Coronavirus Outbreak

The Coronavirus Disease 2019 (COVID‑19) outbreak requires businesses to develop contingency plans to handle the inevitable disruptions that it will continue to cause. A recent Schulte Roth & Zabel program addressed some of the challenges associated with COVID‑19, including cybersecurity and privacy, satisfying regulatory obligations, business continuity planning, and other business issues, with a focus on investment advisers. The program featured Schulte partner Brian T. Daly and special counsel Kelly Koscuiszka. This article discusses key takeaways from their presentation. See “How to Build Culture Using People, Processes and Technology” (Oct. 31, 2018).

Félix de Belloy Joins Hughes Hubbard in Paris

Félix de Belloy represents clients in matters involving cross-border corruption issues, and is joined by associates Ralph Moughanie and Laureen Bokanda-Masson. For more from Hughes Hubbard, see “The ACR’s Guide to Mastering Internal Investigation Interviews: Logistics” (Feb. 5, 2020).

Paul Hastings Expands White Collar Defense Practice in Asia

Shaun Wu focuses on corporate investigations, anti-corruption compliance and white collar defense, and has extensive experience advising corporate clients in Asia. For more from Paul Hastings, see “Airbus Case Marks a Milestone in International Anti‑Corruption Cooperation” (Feb. 19, 2020).