The Anti-Corruption Report

The definitive source of actionable intelligence covering anti-corruption laws around the globe

Articles By Topic

By Topic: Whistleblowers

  • From Vol. 7 No.9 (May 2, 2018)

    How and Why Leaders Should Create Transparent Cultures

    Transparency in an organization can be a critical “early-warning system” for compliance violations and unethical behavior before they metastasize into scandals or regulatory violations that can be costly, if not existentially threatening, to a business. A careful analysis of many, if not most, of the recent corporate scandals shows that, early on, employees voiced concerns about the behavior in question, but no one “listened” effectively to those concerns by taking action. In a guest article, Susan Divers, a senior advisor with LRN Corporation, discusses the most effective way for ethics and compliance leaders to weave a culture of transparency throughout an organization. See “In-House Compliance Experts Provide Practical Insights on Establishing and Maintaining Whistleblower Hotlines” (Aug. 16, 2017).

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  • From Vol. 7 No.8 (Apr. 18, 2018)

    ACR Program Examines FCPA Enforcement and Local Anti-Corruption Efforts in China and Singapore

    Asia has long been the most active region for FCPA enforcement actions and investigations. China, which over the past nine years has had more than three dozen actions involving conduct in the pharmaceuticals, technology, manufacturing and other industries, has recently launched its own anti-corruption regime with a new super agency to enforce it. Additionally, the Keppel Offshore & Marine settlement (involving a decade of bribery committed by the world’s largest oil-rig builder) in late 2017 brought Singapore into the anti-corruption spotlight. During a recent program presented by The Anti-Corruption Report, local experts examined FCPA enforcement as well as local anti-corruption efforts in China and Singapore, challenges in conducting internal investigations in China, and the role of whistleblowers in the region. See “Practitioners Take the Pulse of Anti-Corruption Compliance and Enforcement in China” (Mar. 15, 2017).

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  • From Vol. 7 No.5 (Mar. 7, 2018)

    What the Digital Realty Trust Decision Means for FCPA Compliance

    Despite a seeming victory for companies in a recent Supreme Court decision holding that the anti-retaliation provisions of Dodd-Frank do not apply to an individual who has not reported a violation of securities laws to the SEC, corporations may very well be negatively affected by the high court’s decision. The Anti-Corruption Report talked to practitioners about the compliance implications of the decision in Digital Realty Trust. See “Promoting Values to Encourage Reporting and Discourage Retaliation” (Feb. 21, 2018).

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  • From Vol. 7 No.4 (Feb. 21, 2018)

    Promoting Values to Encourage Reporting and Discourage Retaliation

    Employees who feel safe approaching their managers or using the company’s anti-corruption hotline are more likely to report potential corruption issues. But without a strong ethical culture, individuals who report issues, particularly those sitting far from the watchful eye of corporate headquarters, can be subjected to reprisals. In a recent interview, Katie Smith, chief compliance officer at Convercent, discussed how to establish and demonstrate a company’s values to encourage reporting and simultaneously discourage retaliation. See “In-House Compliance Experts Provide Practical Insights on Establishing and Maintaining Whistleblower Hotlines” (Aug. 16, 2017).

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  • From Vol. 7 No.3 (Feb. 7, 2018)

    Analyzing 2017 SEC Enforcement Activities and Their 2018 Implications

    With a new director and two appointees, the SEC is at its full complement of five for the first time in two years. Fiscal year 2017 saw enforcement developments in the areas of disgorgement, whistleblowers, individual accountability, cybersecurity and cryptocurrencies, the ALJ regime and attorney-client privilege. During a recent webinar hosted by Securities Docket, “A Review of SEC Enforcement in 2017 and What’s Ahead for 2018,” WilmerHale partner William R. McLucas, Linklaters partner Doug Davison, along with Martin Wilczynski and Steven E. Richards, both senior managing directors at Ankura Consulting Group, analyzed these and other developments and their implications for practitioners. See “Top FCPA Officials Discuss How International Cooperation and Individual Prosecutions Are Reshaping Anti-Corruption Enforcement, the Defense Bar Responds” (Dec. 13, 2017).

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  • From Vol. 7 No.1 (Jan. 10, 2018)

    What Multinationals Need to Know About Italy’s New Whistleblowing Provisions

    The Italian Parliament recently passed a bill extending the duty to adopt a whistleblowing system to companies implementing a Law 231 model, the compliance model that companies operating in Italy adopt to avoid liability for corruption and other corporate crimes. In a guest article, Roberto Cursano, partner at the Studio Professionale Associato of Baker & McKenzie located in Rome, comments on the characteristics of this bill, passed on November 15, 2017, and advises companies on how to update their compliance program to comply with it. See “Regional Risk Spotlight: Baker & McKenzie Lawyers Discuss Italy’s Corruption Risks and Unique Compliance Model” (Apr. 20, 2016). 

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  • From Vol. 6 No.18 (Sep. 20, 2017)

    Top SEC Officials Put Mr. and Ms. 401K at the Forefront but Say No Big Changes to Enforcement to Come

    As we move deeper into the Trump administration with few settlements and enforcement actions to indicate what our new regulators are thinking, public statements from enforcement officials are becoming increasingly relevant. At a recent event co-hosted by the Institute for Corporate Governance and Finance, the Program on Corporate Compliance and Enforcement and the Pollack Center for Law & Business at the New York University School of Law, SEC Chair Jay Clayton, along with Stephanie Avakian and Steven Peikin, Co-Directors of the SEC Division of Enforcement, gave some insights on what SEC enforcement may look like going forward. See “DOJ Reiterates Commitment to FCPA Enforcement but Resources May Become an Issue” (Jul. 19, 2017).

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  • From Vol. 6 No.16 (Aug. 16, 2017)

    In-House Compliance Experts Provide Practical Insights on Establishing and Maintaining Whistleblower Hotlines

    Multinational companies face specific challenges when developing means for employees to report suspected misconduct – differing regulations and culture make a uniform method difficult. During SCCE’s recent European Compliance & Ethics Institute, a panel of in-house compliance experts discussed how their companies approach the establishment and maintenance of whistleblower hotlines around the globe. See our series on the nuts and bolts of anti-corruption hotlines: “Interview with Benjamin Haley of Covington & Burling” (Sep. 24, 2014); “Interview with Brandon Daniels, President of Managed Services, Clutch Group” (Dec. 3, 2014); and “An Interview With Janice Innis-Thompson, Senior Vice President and Chief Compliance Officer at TIAA-CREF” (Jan. 7, 2015).

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  • From Vol. 6 No.5 (Mar. 15, 2017)

    Practitioners Take the Pulse of Anti-Corruption Compliance and Enforcement in China

    China’s aggressive but sometimes opaque anti-corruption efforts have been making headlines for the past several years and companies are facing a “fluid enforcement environment,” according to Nathan G. Bush, a partner at DLA Piper. The domestic anti-corruption efforts of President Xi Jinping’s regime and uncertainty over how the Trump administration will enforce the FCPA and interact with Beijing make anti-corruption compliance particularly challenging. A recent Strafford seminar featuring Michael S. Diamant and Michael Li-Ming Wong, partners at Gibson Dunn, and Cindy Hong, a partner at K&L Gates, offered a thorough overview of the current state of the anti-corruption and political climate in China. This article summarizes the key insights from the program. See our two-part series on China’s State Secrets Law: “A Primer for Anti-Corruption Practitioners (Part One)”(Jun. 29, 2016); and “Six Things to Consider When Engaging in Internal Investigations in China (Part Two)” (Jul. 13, 2016).

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  • From Vol. 6 No.2 (Feb. 1, 2017)

    A New Era in FCPA Disclosure

    In the past few years, U.S. enforcement authorities have heightened their rhetoric surrounding voluntary and complete self-disclosure. New policies and rules issued by the government strongly encourage and incentivize disclosure in unprecedented ways. At the same time, an alarming increase in data leaks and the ever-present danger of whistleblowers threaten to reveal or force the disclosure of company information and secrets at every turn. In a guest article, Lara A. Covington, a partner in the Washington, D.C., office of Holland & Knight, and Lisa A. Prager, a partner in the firm’s New York office, explain that the net effect of these internal and external pressures is that U.S. companies have never faced more inducements to disclose potential FCPA violations nor higher risks of inadvertently disclosing them. See The FCPA Report’s three-part series on the DOJ’s Pilot Program: “Going Deep on the Fraud Section’s FCPA Pilot Program” (Apr. 20, 2016); “How Will the Fraud Section’s Pilot Program Change Voluntary Self-Reporting?” (May 4, 2016); and “Earning Cooperation Credit Under the Fraud Section’s FCPA Pilot Program” (May 18, 2016).

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  • From Vol. 5 No.21 (Oct. 26, 2016)

    Despite Anemic Prosecutions, France Moves Toward Increased Anti-Corruption Enforcement

    France’s anti-corruption enforcement track record leaves much to be desired. Despite having relatively well developed and robust anti-corruption legislation, as recently as 2008 there had been no convictions in France for foreign bribery offences. An awareness of such issues has been present for years, and notably has been raised by organisations including the OECD, however, little progress has been made by way of effective reform. In a guest article, Jonathan Mattout, a partner in in the Paris office of Herbert Smith Freehills, details recent and upcoming enhancements to the French ABC laws. See “Recordbreaking Alstom Criminal FCPA Settlement Results From Wide-Ranging Bribery Scheme and Lack of Cooperation” (Jan. 7, 2015). 

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  • From Vol. 5 No.21 (Oct. 26, 2016)

    Lynch’s Visit to Italy Highlights International Cooperation and Enforcement

    On October 20, 2016, U.S. Attorney General Loretta E. Lynch and Italian Minister of Justice Andrea Orlando hosted a meeting about international cooperation in the fight against organized crime and corruption. The meeting focused on the recent achievements and future developments of the collaboration between the U.S. and the Italian governments in the judicial field. In a guest article, Italian lawyers Roberto Cursano and Riccardo Ovidi, counsel and associate at Studio Professionale Associato at Baker & McKenzie discuss the key takeaways from the meeting, arguing that the meeting’s focus on collaboration confirms that companies should take into account the transnational dimension of anti-corruption enforcement when formulating their compliance programs. See “The Italian Organismo di Vigilanza, A Model for an Effective Compliance Committee” (Jun.15, 2016).

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  • From Vol. 5 No.20 (Oct. 12, 2016)

    Subsidiary Corruption, a Troublesome Joint Venture and a Fired Whistleblower: AB InBev’s Route to a $6 Million SEC Settlement

    Anheuser-Busch InBev (AB InBev) recently settled with the SEC to resolve FCPA books and records violations relating to the actions of its Indian joint venture and internal controls violations relating to its Indian subsidiary. The brewing company’s settlement highlights, once again, that companies operating in high-risk markets cannot be complacent about the activities of their foreign cohorts, whether that be subsidiaries, joint venture partners or third parties operating on behalf of the company. The settlement also highlights the dangers of interfering with whistleblowers. AB InBev was charged with impeding a whistleblower through the provisions of an employee separation agreement. See “Regional Risk Spotlight: Jay Holtmeier of WilmerHale Explains How to Navigate Bureaucratic Corruption Risks in India” (Sep. 23, 2015).

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  • From Vol. 5 No.20 (Oct. 12, 2016)

    The SEC as the Whistleblower Program’s Advocate: Severance Agreements and FCPA Investigations

    The recent close of the SEC’s fiscal year added notable guidance to a significant period of FCPA enforcement, including several cases that reveal a new feature of the SEC’s efforts to protect whistleblowers. These actions imposed penalties on companies for severance agreements that restricted the ability of employees to seek financial rewards for reporting potential violations of the securities laws to the SEC. They provide further evidence not only of the SEC’s dim view of companies’ efforts to undermine its growing Whistleblower Program, but also of the agency’s desire and ability to use Rule 21F-17 to combat them. In a guest article, Cravath partner David M. Stuart and his associate Kyle S. Gazis explain why these cases are particularly important precedents for companies with worldwide operations. They also analyze the SEC’s latest efforts to defend the Whistleblower Program and the resulting effects on companies seeking to address the risks of FCPA violations. See “Addressing Employees’ Perception That Internally Reporting Compliance Violations Is Futile” (Aug. 10, 2016).

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  • From Vol. 5 No.16 (Aug. 10, 2016)

    Addressing Employees’ Perception That Internally Reporting Compliance Violations Is Futile 

    FCPA investigations triggered by whistleblower reports are increasingly likely as the SEC whistleblower program matures. According to the 2015 Annual Report on the Whistleblower Program, 80 percent of employee or former employee whistleblowers raised their concerns internally to their supervisors or compliance personnel (or otherwise understood that the company knew of the violations) before reporting their tips to the Commission. In a guest article, Cravath’s David Stuart and Harry Black discuss why employees often feel compelled to report violations outside of the company after they have reported internally and suggest how companies can incentivize prompt internal reporting and decrease external disclosures without running afoul of SEC rules prohibiting a company or individual from impeding reports to the SEC. See “Implications of the SEC’s First-Ever Whistleblower Protection Enforcement Action” (Apr. 15, 2015). 

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  • From Vol. 5 No.5 (Mar. 9, 2016)

    Five Stages of Corruption and Myriad Internal Controls Failures: Compliance Takeaways From the VimpelCom Settlement

    VimpelCom’s historic settlement with U.S. and Dutch authorities was notable for many reasons, among them the enormous penalties and disgorgement paid and the DOJ’s attendant civil forfeiture suit. But beyond the settlement itself, which was discussed in the first part of this two-part article series, the underlying bribery scheme is noteworthy – and informative – as well. Over and over the company’s weak internal controls enabled employees to make corrupt payments to a government official in Uzbekistan. Here, we take a close look at the five stages of corruption that were outlined by the DOJ in its criminal information. The underlying facts show the mechanics of how corrupt payments can be made and how strong internal controls could have prevented them. See “Examining New DOJ Compliance Counsel Hui Chen’s Four Elements of a Successful Compliance Program” (Jan. 13, 2016).

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  • From Vol. 5 No.5 (Mar. 9, 2016)

    Failure to Heed a CCO Whistleblower’s Warnings Leads to Olympus’ $646 Million Anti-Kickback, FCA and FCPA Settlement

    The DOJ’s recent settlement with medical-device distributor Olympus demonstrates that corruption is not confined to emerging or high-risk markets. Rather, when a company fails to implement effective compliance measures, corruption can occur anywhere, even in the United States. From 2006 to 2011, Olympus Latin America (OLA) attempted to increase medical equipment sales in Central and South America by paying health care practitioners at government-run facilities more than $3 million. Simultaneously, in North America, Olympus employees were paying kickbacks to doctors and hospitals. The charges against Olympus resulted from a False Claims Act lawsuit filed by its former chief compliance officer who allegedly first-reported the claims internally – Olympus executives apparently failed to heed his warnings. See “Whistleblower Advocate and Experts at Gibson Dunn Discuss the Current State of the Dodd-Frank Whistleblower Program” (Jan. 13, 2016).

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  • From Vol. 5 No.1 (Jan. 13, 2016)

    Whistleblower Advocate and Experts at Gibson Dunn Discuss the Current State of the Dodd-Frank Whistleblower Program

    According to top officials at both the DOJ and SEC, whistleblowers are an ever-increasing point of origination for FCPA cases. Whistleblowers and their attorneys are becoming more sophisticated about how – and when – they present information to the government, and the possibility of large awards based on the Dodd-Frank whistleblower program is attracting new tips from across the globe. A recent program sponsored by Securities Docket and Gibson, Dunn & Crutcher examined the state of the Dodd-Frank whistleblower program and provided practical insights on the reporting and award-claim process. The discussion was led by Gibson Dunn partner F. Joseph Warin and featured John W.F. Chesley, also a Gibson Dunn partner, and Erika A. Kelton, a partner at Phillips & Cohen who represents whistleblowers. For more from Chesley and Warin, see “Five Themes for General Counsel to Monitor With Respect to Dodd-Frank Whistleblowers and the FCPA” (Oct. 3, 2012).

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  • From Vol. 4 No.26 (Dec. 16, 2015)

    2015 Office of the Whistleblower Report Highlights a Banner Year for Whistleblowers

    The whistleblower program continues to bear fruit for SEC investigations, according to the recently released 2015 Annual Report to Congress on the Dodd-Frank Whistleblower Program.  Fiscal year 2015 had the most whistleblower tips since the program began in 2011, as well as the highest individual and aggregate award payments to date.  For coverage of previous annual reports from the Office of the Whistleblower, see “Preparing for the Increasing Role of Whistleblowers in FCPA Enforcement,” The FCPA Report, Vol. 4, No. 2 (Jan. 21, 2015) and “Key Takeaways from the 2013 Office of the Whistleblower Report,” The FCPA Report, Vol. 2, No. 25 (Dec. 18, 2013).

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  • From Vol. 4 No.25 (Dec. 2, 2015)

    Top FCPA Enforcers Discuss Evolving and Diverging Enforcement Approaches and the Defense Bar Responds

    International cooperation and whistleblowers are changing the government’s investigations and resolutions according to top FCPA enforcers.  Due to these changes – and the ever-increasing sophistication of both the SEC and DOJ – the agencies’ goals, strategies and tactics continue to evolve and diverge based on their statutory remits.  At this year’s ACI FCPA conference, Kara Brockmeyer, Chief of the FCPA Unit of the Division of Enforcement of the SEC, and Patrick Stokes, Deputy Chief of the Fraud Section of the Criminal Division of the DOJ, distilled the government’s enforcement priorities in their “Year in Review” discussion, and The FCPA Report spoke to several anti-corruption defense experts for their reactions.  Stokes and Brockmeyer also discussed what they expect from compliance programs as well as the incentives they offer companies to self-report, cooperate and remediate, which will be discussed at length, with input from the FCPA bar, in our next issue.  For coverage of last year’s panel see “Top FCPA Enforcers Tout Voluntary Disclosure and Warn About International Cooperation; The Defense Bar Responds,” The FCPA Report, Vol. 3, No. 24 (Dec. 3, 2014) and “Top FCPA Officials Talk Compliance Tips and the Defense Bar Weighs In,” The FCPA Report, Vol. 3, No. 25 (Dec. 17, 2014).

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  • From Vol. 4 No.15 (Jul. 22, 2015)

    EY’s Asia-Pacific Fraud Survey Finds Correlation Between Talent Retention and Ethical Business Conduct

    EY's 2015 Asia-Pacific fraud survey examined the prevalence of third-party and cybersecurity risks and found that although an ethical business culture can help retain talent, significant weaknesses persist in the anti-corruption measures of organizations in the region, especially when it comes to whistleblowers.  This article summarizes the key takeaways from the report.  See also “Ernst & Young’s 2013 Asia-Pacific Fraud Survey Highlights Disconnect Between Company Policies and Employee Perceptions,” The FCPA Report, Vol. 2, No. 20 (Oct. 9, 2013).

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  • From Vol. 4 No.14 (Jul. 8, 2015)

    Regional Risk Spotlight: William McGovern of Kobre & Kim Advises on How to Handle Corruption Risk When Doing Business in China

    China has long been plagued with high corruption risk.  However, the recent uptick in China’s own anti-corruption enforcement – evidenced recently by the fine the Chinese government levied on GSK – is changing the corruption landscape there, as is the steady focus on China by U.S. regulators.  In this installment of The FCPA Report’s Regional Risk Spotlight series, we talk to William McGovern, a partner in Kobre & Kim’s Hong Kong office, about the most pressing corruption issues in China and how companies doing business there can handle them.  See also “Understanding and Tackling China’s Corruption Challenges,” The FCPA Report, Vol. 3, No. 5 (Mar. 5, 2014).

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  • From Vol. 4 No.10 (May 13, 2015)

    Deciphering the Chinese Anti-Corruption Landscape

    Corruption risk has loomed large for companies operating in China for a long time.  However, recent events may be changing the landscape there – both the aggressive FCPA enforcement by U.S. regulators and the well-publicized battle against corruption by the Chinese government may be having an impact.  A recent program sponsored by Clear Law Institute surveyed the current FCPA enforcement climate as it relates to China, discussed China’s internal anti-corruption efforts, and offered strategies for anti-corruption compliance in China.  The program featured Michael Diamant, a partner at Gibson Dunn.  See also “A Guide to Anti-Bribery Issue Spotting in China: Enforcement Trends, Third-Party Risks, Gift Giving, Travel Expenses, Foreign Officials and Due Diligence,” The FCPA Report, Vol. 2, No. 7 (Apr. 3, 2013); and “Gibson Dunn Attorneys Take the Pulse of Anti-Corruption Risks in Emerging Markets,” The FCPA Report, Vol. 3, No. 3 (Feb. 5, 2014).

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  • From Vol. 4 No.8 (Apr. 15, 2015)

    Implications of the SEC’s First-Ever Whistleblower Protection Enforcement Action

    The SEC has announced its first enforcement action under a rule prohibiting companies from impeding an individual’s efforts to report a potential securities law violation to the SEC.  The Commission’s settlement with KBR over language in its form confidentiality agreement signals that the SEC intends to take a sweeping view of the whistleblower protection rule.  In a guest article, David M. Stuart and Omar K. Madhany, partner and associate, respectively, at Cravath, Swaine & Moore LLP, analyze the decision and suggest steps that companies can take to ensure compliance with the rule.  See also “Preparing for the Increasing Role of Whistleblowers in FCPA Enforcement,” The FCPA Report, Vol. 4, No. 2 (Jan. 21, 2015). 

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  • From Vol. 4 No.7 (Apr. 1, 2015)

    Experts Discuss the Crucial First 48 Hours of an Internal Investigation and Beyond

    When a company uncovers an anti-corruption problem, it must be ready to react quickly.  “The first 48 hours of any investigation are often critical to the success of that investigation,” Andrew Foose, Vice President of Advisory Services at NAVEX Global, said during a panel at the recent Global Ethics Summit, hosted by Ethisphere Institute and Thomson Reuters.  Foose and the other panelists, William Jacobson, a partner at Orrick, Herrington & Sutcliffe; Adam Briggs, Regulatory Compliance & Ethics Attorney for United Parcel Service; and Benjamin Gruenstein, a partner at Cravath, Swaine & Moore, detailed strategies for those crucial first days and also discussed long-term best practices for conducting effective investigations.  See also “How to Conduct an Anti-Corruption Investigation: Ten Factors to Consider at the Outset (Part One of Two),” The FCPA Report, Vol. 2, No. 25 (Dec. 18, 2013); “Developing and Implementing the Investigation Plan (Part Two of Two),” Vol. 3, No. 1 (Jan. 8, 2014).

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  • From Vol. 4 No.4 (Feb. 18, 2015)

    Private Equity FCPA Enforcement: High Risk or Hype?

    Extraction, engineering, pharmaceuticals and medical device manufacturers — FCPA prosecutors have already swept through these industries. Are private equity firms next?  In a guest article, Laurence A. Urgenson, Joseph De Simone, Audrey L. Harris, Matthew A. Rossi, Matthew Alexander and Melanie M. Burke, attorneys at Mayer Brown LLP, assert that, using Dodd-Frank and the SEC’s new presence exams, the government may very well turn its attention towards the private equity industry.  They detail the enforcement landscape, the bribery risks for private equity firms (among other things: hiring practices, sovereign wealth funds, acquisitions and joint ventures) and best practices to mitigate those risks.  See also “Buyer Beware: Understanding and Mitigating Parent Company FCPA Liability in the Context of Private Equity Acquisitions,” The FCPA Report, Vol. 2, No. 15 (Jul. 24, 2013).

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  • From Vol. 4 No.2 (Jan. 21, 2015)

    Preparing for the Increasing Role of Whistleblowers in FCPA Enforcement

    The growth in the Dodd-Frank Whistleblower Program, as revealed in the 2014 Whistleblower Report, has a diverse group of stakeholders – companies, whistleblowers, counsel, the SEC and Congress – clamoring for answers about the scope and application of the Dodd-Frank whistleblower provisions.  In a guest article, David M. Stuart and Omar K. Madhany, partner and associate, respectively, at Cravath, Swaine & Moore LLP, analyze the provisions and how they have been enforced and interpreted.  They also discuss how companies can encourage internal reporting and the importance of ensuring that employee agreements are in compliance with the whistleblower provisions.  See also “Seven Lessons from FCPA Enforcement Trends from FCPA Experts in the Public and Private Sector (Part One of Two),” The FCPA Report, Vol. 3, No. 8 (Apr. 16, 2014).

     

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  • From Vol. 4 No.1 (Jan. 7, 2015)

    Top Practitioners Survey Dodd-Frank Whistleblower Landscape

    Large awards to whistleblowers under rhe Dodd-Frank whistleblower program, such as the recent $57 million award to former Countrywide Financial executive Edward O’Donnell,  raise the visibility of the Dodd-Frank program, heightening the need for companies to understand the provisions.  A recent program sponsored by Securities Docket and the law firm Gibson Dunn & Crutcher discussed salient aspects of the Dodd-Frank program, including how the whistleblower provisions have functioned since their adoption and key elements of the reporting and award processes.  The panelists, Gibson Dunn partners F. Joseph Warin and John W.F. Chesley and Phillips & Cohen partner Erika A. Kelton, also offered insights drawn from recent whistleblower awards and highlighted critical unresolved issues under that regime.  For more insight from Warin and Chesley on whistleblowers, see “Five Themes for General Counsel to Monitor with Respect to Dodd-Frank Whistleblowers and the FCPA,” The FCPA Report, Vol. 1, No. 9 (Oct. 3, 2012).

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  • From Vol. 3 No.24 (Dec. 3, 2014)

    Top FCPA Enforcers Tout Voluntary Disclosure and Warn About International Cooperation; The Defense Bar Responds

    At what has become a traditional annual speech summarizing the year in FCPA developments, Kara Brockmeyer, Chief of the FCPA Unit of the Division of Enforcement of the SEC and Patrick Stokes, Deputy Chief of the Fraud Section of the Criminal Division of the DOJ, beat the government self-reporting drum, warned about increasing international anti-corruption enforcement and cautioned companies to re-evaluate confidentiality agreements they use during internal investigations.  The FCPA Report talked to prominent FCPA practitioners to get their take on this year’s speech at American Conference Institute's International Conference on the Foreign Corrupt Practices Act.  They said the significance of the speech lay in the tone and topics emphasized.  See our coverage of last year’s speech here and here.

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  • From Vol. 3 No.24 (Dec. 3, 2014)

    Caldwell and Ceresney Push Companies on FCPA Compliance, Cooperation and Self-Reporting

    Reinforcing familiar messages, senior government officials at the SEC and DOJ said the FCPA continues to be a priority and self-reporting and cooperation count a lot towards the mitigation of penalties.  Speaking at American Conference Institute’s recent International Conference on the Foreign Corrupt Practices Act, Assistant Attorney General Leslie R. Caldwell and the Director of the SEC Division of Enforcement Andrew Ceresney described the government’s focus going forward in each of their keynote speeches, including focusing on prosecuting individuals; the strengthening of the Kleptocracy Initiative; and increasing international cooperation.  The FCPA Report synthesizes their speeches here and also in this issue presents private practitioners’ takeaways from the government's "Year in Review" presentation at the conference.  See also “In Final Speech as Criminal Division Head, Mythili Raman Emphasizes DOJ’s Focus on Anti-Corruption Efforts, Highlighting Individual Convictions and Foreign Cooperation,” The FCPA Report, Vol. 3, No. 7 (Apr. 2, 2014).

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  • From Vol. 3 No.24 (Dec. 3, 2014)

    The Nuts and Bolts of Anti-Corruption Hotlines: An Interview with Brandon Daniels, President of Managed Services, Clutch Group

    An effective hotline program is integral when it comes to a company’s ability to proactively handle compliance issues before they become endemic.  And hotlines can encourage internal reporting, affording a company time to investigate conduct before the government does.  As part of our interview series on hotlines, we talked to Brandon Daniels, president of Managed Services at Clutch Group, a litigation and compliance service provider.  He leads the organization’s strategy for all commercial and operational aspects of the company’s Litigation & Investigation, Compliance & Risk, and Corporate In-house Services.  Daniels discussed, among other things, methods of reporting, when to outsource the hotline, data privacy issues and handling cultural sensitivities.  See “The Nuts and Bolts of Anti-Corruption Hotlines: An Interview with Benjamin Haley of Covington & Burling,” The FCPA Report, Vol. 3, No. 19 (Sep. 24, 2014).

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  • From Vol. 3 No.15 (Jul. 23, 2014)

    Sanctions for Retaliating Against Whistleblower Highlight the Importance of Incentivizing Internal Reporting

    What, if anything, can companies do with respect to a whistleblower’s employment without violating the anti-retaliation provisions in the Exchange Act?  In a recent order, the first of its kind, the SEC sanctioned a private fund manager for taking adverse employment actions against a whistleblower who reported principal transaction compliance shortcomings to the SEC.  In light of this decision, what legal or operational options are available to a company that fails to incentivize internal reporting of FCPA and other compliance violations?  See also “Seven Steps Companies Can Take to Incentivize Internal Reporting of FCPA Violations,” The FCPA Report, Vol. 1, No. 3 (Jul. 11, 2012). 

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  • From Vol. 3 No.8 (Apr. 16, 2014)

    FCPA Experts in the Public and Private Sector Share Seven Lessons from Recent Cases (Part One of Two)

    At a recent panel discussion sponsored by the Knowledge Group, former FCPA prosecutors, a current SEC lawyer and an economist shared their insights on what recent FCPA enforcement actions mean for companies, along with advice for initiating and conducting FCPA investigations.  This article, the first of a two-part series, contains seven lessons the panelists have extracted from recent FCPA settlements and trends; initial decisions that a company faces when it discovers a potential violation; and the role of whistleblowers in revealing potential violations.  The second part of the series will cover the panelists’ insights on initiating internal investigations; voluntary disclosures; multi-jurisdictional concerns; negotiations with regulators; remediation efforts and calculation of fines.  See also “Top DOJ and SEC Officials Discuss FCPA Enforcement Priorities and Mechanics,” The FCPA Report, Vol. 3, No. 7 (Apr. 2, 2014).

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  • From Vol. 3 No.8 (Apr. 16, 2014)

    Seven Lessons from FCPA Enforcement Trends from FCPA Experts in the Public and Private Sector (Part One of Two)

    At a recent panel discussion sponsored by the Knowledge Group, former FCPA prosecutors, a current SEC lawyer and an economist shared their insights on what recent FCPA enforcement actions mean for companies, along with advice for initiating and conducting FCPA investigations. This article, the first of a two-part series, contains seven lessons the panelists have extracted from recent FCPA settlements and trends; initial decisions that a company faces when it discovers a potential violation; and the role of whistleblowers in revealing potential violations. The second part of the series will cover the panelists’ insights on initiating internal investigations; voluntary disclosures; multi-jurisdictional concerns; negotiations with regulators; remediation efforts and calculation of fines. See also “Top DOJ and SEC Officials Discuss FCPA Enforcement Priorities and Mechanics,” The FCPA Report, Vol. 3, No. 7 (Apr. 2, 2014).

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  • From Vol. 3 No.5 (Mar. 5, 2014)

    Understanding and Tackling China’s Corruption Challenges

    “The FCPA applies with special force in China due to China’s state-dominated economy and pervasive business culture where petty corruption is common and tolerated,” Professor Daniel Chow said at a recent seminar at Fordham Law School sponsored by the Chinese Business Lawyers Association.  Chow and two other panelists, Paul Hastings partner Nat Edmonds, and Dorsey & Whitney partner Thomas Gorman, along with the Honorable Denny Chin of the U.S. Court of Appeals for the Second Circuit (who gave closing remarks), discussed the unique risks companies face in China, the cultural sensitivities that make compliance difficult, the status of China’s enforcement of its own corruption laws and practical recommendations for doing business ethically in a region where many businesses can reap big rewards.  Professor Sean Griffith of Fordham Law School gave opening remarks and Associate Professor Carl Minzner moderated.  See also “Gibson Dunn Attorneys Take the Pulse of Anti-Corruption Risks in Emerging Markets,” The FCPA Report, Vol. 3, No. 3 (Feb. 5, 2014).

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  • From Vol. 3 No.4 (Feb. 19, 2014)

    Six Things Every Business Lawyer Needs to Know About the FCPA

    Whether you’re in-house counsel or a transactional lawyer at a law firm, anti-corruption is something that should very much be on your radar – the government is aggressive, the fines can be astronomical and people do go to jail.  That was the message from William H. Devaney, partner at Venable and moderator of the American Bar Association’s recent webinar, “What Every Business Lawyer Should Know About the FCPA.”  The panel discussion provided business lawyers with information and advice about staying compliant in this anti-corruption enforcement climate.  The panelists were Lynn A. Neils, a partner at Covington & Burling; Carlos Ortiz, a partner at Edwards Wildman; Brian T. Sumner, in-house counsel at Alcoa; and Douglas Tween, a partner at Baker McKenzie.  See also “How to Conduct an Anti-Corruption Investigation: Ten Factors to Consider at the Outset (Part One of Two),” The FCPA Report, Vol. 2. No. 25 (Dec. 18, 2013); “Developing and Implementing the Investigation Plan (Part Two of Two),” Vol. 3, No. 1 (Jan. 8, 2014).

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  • From Vol. 3 No.3 (Feb. 5, 2014)

    Gibson Dunn Attorneys Take the Pulse of Anti-Corruption Risks in Emerging Markets

    The anti-corruption enforcement landscape is changing and emerging markets, with their endemic cultures of corruption and vast economic opportunity for many multi-national companies, are at the forefront of that change.  Many are implementing and enforcing their own laws, but the deep-seated risks of corruption still exist.  A recent panel of emerging market experts from Gibson Dunn & Crutcher LLP highlighted the current anti-corruption initiatives and trends in key foreign markets.  The presentation, “FCPA Trends in the Emerging Markets of China, the Middle East and Africa, Russia and India,” featured Gibson Dunn partners F. Joseph Warin, Benno Schwarz, Kelly S. Austin and Peter Gray.  See also “Lessons from the Latest Anti-Corruption Developments in the U.K., Brazil and China,” The FCPA Report, Vol. 2, No. 7 (Apr. 3, 2013).

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  • From Vol. 3 No.2 (Jan. 22, 2014)

    Assessing the Year in FCPA Enforcement and Looking Ahead

    Following a relatively flat enforcement landscape and some bumps in the 2013 prosecutorial road, the DOJ and the SEC appear poised to spring back into action on FCPA and related anti-corruption enforcement.  Other nations have also ramped up activity in this arena by fortifying their laws and enforcement outlooks, including by bringing “carbon copy” actions.  In a guest article, T. Markus Funk and Sambo “Bo” Dul, partner and associate, respectively, at Perkins Coie LLP, take a look at the major FCPA and anti-corruption developments of 2013, as well as what may be in store for 2014.  See also “A Perspective from the FCPA Defense Bar on Brockmeyer and Duross’ ‘Year In Review’: Interview with Danforth Newcomb, of Shearman & Sterling,” The FCPA Report, Vol. 3, No. 1 (Jan. 8, 2014); and “FCPA Corporate Settlements of 2013: Details, Trends and Compliance Takeaways,” The FCPA Report, Vol. 2, No. 25 (Dec. 18, 2013).

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  • From Vol. 2 No.25 (Dec. 18, 2013)

    Key Takeaways from the 2013 Office of the Whistleblower Report

    It’s been two years since the Dodd-Frank Whistleblower Program – which gives whistleblowers the opportunity to obtain a financial reward – was implemented.  There have been limited rewards under the program (though one reward was certainly noteworthy in its size, $14 million), but whistleblower tips have increased, as many have expected, forcing companies to take note.  The 2013 Annual Report to Congress on the Dodd-Frank Whistleblower Program, recently issued by the SEC, provides information on the tips received and the awards.  Some experts say the Report is too vague and more information is needed for companies to fully understand how to best handle the new law.  This article summarizes the key takeaways from the Report and includes insight from a recent webinar hosted by Securities Docket featuring F. Joseph Warin, partner at Gibson Dunn LLP, and Jay Perlman, Director at Navigant Consulting, Inc.  See “Top FCPA Practitioners Share Strategies for Detecting, Preventing and Responding to Whistleblower Allegations,” The FCPA Report, Vol. 2, No. 13 (Jun. 26, 2013). 

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  • From Vol. 2 No.24 (Dec. 4, 2013)

    Charles Duross and Kara Brockmeyer Discuss Five FCPA Enforcement Trends That Matter to Regulators: Individual Prosecutions, Administrative Proceedings, Global Coordination, Corporate Monitors and Third Parties (Part One of Two)

    At ACI’s International Conference on the Foreign Corrupt Practices Act in Washington D.C., Charles Duross, Deputy Chief of the Fraud Section of the Criminal Division of the DOJ, and Kara Brockmeyer, Chief of the FCPA Unit of the Division of Enforcement of the SEC, provided candid and detailed insight into elements of FCPA enforcement that matter to leading regulators.  They discussed the government’s charging philosophies, investigative techniques and enforcement priorities, and dispensed advice about how companies can avoid or decrease FCPA penalties.  This article summarizes the most noteworthy insights shared by Duross and Brockmeyer, and discusses the practical implications of the regulators’ points.  See also “Five Lessons from 2013 FCPA Enforcement: Transaction Monitoring, International Cooperation, Documenting Hiring Decisions, Risk Assessments and Individual Prosecutions,” The FCPA Report, Vol. 2, No. 22 (Nov. 6, 2013).

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  • From Vol. 2 No.23 (Nov. 20, 2013)

    Construction Industry Experts Discuss Crucial Steps in Internal Corruption Investigations, Due Diligence Best Practices and the Value of Cooperation

    Could the construction industry be the next target of anti-corruption enforcement action in the U.S. and abroad?  The industry is rife with risk – in the U.K., for example, 49% of corruption professionals say corruption is widespread, and law firm Reed Smith LLP predicts that at least two large U.K. Bribery Act investigations are in the works in the next two years for international construction firms.  How can construction companies, and others similarly situated, anticipate and mitigate what may be a gathering enforcement storm?  The Practising Law Institute recently sponsored a panel of attorneys with extensive experience in construction contracting who discussed the best ways to enhance compliance for the construction industry, offering lessons applicable to a range of industries.  The panelists analyzed the current global anti-corruption enforcement climate, detailed best practices with regard to due diligence when contracting with third parties in foreign countries, provided steps that a company should take when faced with an FCPA issue, including investigation mistakes companies make, and examined the value of cooperation and voluntary disclosure.  See also “Survey Reveals the Contours and Content of Bribery in the U.K. Construction Industry,” The FCPA Report, Vol. 2, No. 20 (Oct. 9, 2013).

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  • From Vol. 2 No.22 (Nov. 6, 2013)

    New York Judge Rules that Foreign FCPA Whistleblowers Are Not Protected Under Dodd-Frank’s Anti-Retaliation Provision

    Does Dodd-Frank’s Anti-Retaliation Provision protect a foreign employee who reports FCPA violations based on conduct that occurred extraterritorially?  A court in the Southern District of New York recently became the second district court in the country to say that it does not.  Judge William H. Pauley III granted Siemens A.G.’s motion to dismiss Meng-Lin Liu’s case against it on October 21, 2013, holding that whistleblower protection does not apply to activity outside the United States, but declining to opine on whether Dodd-Frank’s definition of “whistleblower” extends to those who report to the SEC after the alleged retaliation has occurred.  Liu, a Taiwanese resident who worked for Siemens’ Chinese subsidiary, alleges that he was retaliated against after he internally reported a potential FCPA violation regarding an alleged kickback scheme in China and Korea.  He reported it to the SEC after he was terminated.  Siemens has a checkered FCPA history, having paid a record-breaking fine in 2008.  See “Lessons Learned on Crafting Compliance Programs from the Largest FCPA Case in History,” The FCPA Report, Vol. 1, No. 3 (Jul. 11, 2012).  For more on Dodd-Frank’s whistleblower provisions, see “Seven Steps Companies Can Take to Incentivize Internal Reporting of FCPA Violations,” The FCPA Report, Vol. 1, No. 3 (Jul. 11, 2012). 

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  • From Vol. 2 No.21 (Oct. 23, 2013)

    K&L Gates Panel Reviews Anti-Corruption Enforcement in the U.S., the U.K., China, Australia, Latin America, Africa, Southeast Asia and Russia

    With the spate of new anti-corruption laws around the globe, and the evolution of laws already on the books, “it is critical for a company to have on-the-ground information and local support” in structuring an effective anti-bribery and anti-corruption (ABAC) program and responding to regulatory action in all of the regions in which it operates.  So said Dick Thornburgh, former Attorney General of the United States and former Governor of Pennsylvania, introducing a recent webinar presented by K&L Gates LLP, where Thornburgh is now of counsel.  The K&L Gates speakers who followed Thornburgh shared their direct local experiences and examined the state of the ABAC laws in their regions of speciality.

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  • From Vol. 2 No.17 (Aug. 21, 2013)

    How to Anticipate and Manage Collateral Litigation after an FCPA Investigation Becomes Public

    A government investigation may be only the beginning of a company’s FCPA-related troubles.  Once the curtain is raised on an investigation, the company may face collateral litigation from various parties, multiplying its problems and presenting an array of challenges.  See “Non-FCPA Liability for Alleged FCPA Violations,” The FCPA Report, Vol. 1, No. 1 (Jun. 6, 2012).  (A public company under investigation must also contend with disclosure questions and reserve requirements.)  How can a company protect itself?  How can it maintain control over its confidential business information?  How can it cooperate with the government without providing a roadmap for plaintiffs’ lawyers?  At a recent panel hosted by the American Conference Institute, FCPA experts addressed these issues and others.  

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  • From Vol. 2 No.16 (Aug. 7, 2013)

    Seven Lessons from China’s Bribery Investigation of GlaxoSmithKline 

    The Chinese government’s recent actions against employees of pharmaceutical giant GlaxoSmithKline plc in connection with possible commercial and government bribery have thrust the business practices of pharmaceutical and other health-related companies in China into the spotlight.  Speculation is growing that China may be increasing enforcement of its anti-bribery laws against a range of industries.  Chinese anti-bribery enforcement varies in important ways from U.S. enforcement.  Therefore, it is important for companies operating in China to understand what steps they can take to mitigate corruption risk, uncover and react to bribery by their employees and others, and be prepared for unannounced visits from Chinese regulators.  In a recent webinar, Shanghai-based K&L Gates partner Amy Sommers offered seven compliance and business lessons that companies can learn from GSK’s predicament.  See also “China Clarifies and Expands its Anti-Bribery Laws,” The FCPA Report, Vol. 2, No. 3 (Feb. 6, 2013).

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  • From Vol. 2 No.13 (Jun. 26, 2013)

    Top FCPA Practitioners Share Strategies for Detecting, Preventing and Responding to Whistleblower Allegations

    Organizations operating internationally are exposed to seemingly endless sources of complainants – employees, former employees, third-party sales agents, suppliers, distributors and even competitors could potentially become whistleblowers.  How, in such an environment, does a company decrease the likelihood that it will be the subject of a whistleblower complaint?  Corporate whistleblowers remain one of the top concerns of companies subject to the FCPA.  That concern is fueled by the recent implementation of the Dodd-Frank Act’s reward program, which awarded its second money prize on June 12, 2013 to whistleblowers who provided information about a “sham” hedge fund and its chief executive.  Experts predict that more awards are soon to follow.  During two recent panels – one held at the American Bar Association’s Fifth Annual National Institute on Internal Corporate Investigations and Forum for In-house Counsel, and the other at the Practising Law Institute’s Foreign Corrupt Practices Act and International Anti-Corruption Law Developments 2013 program – FCPA practitioners discussed strategies for identifying, preventing and addressing whistleblower allegations.  See also “Specific Strategies from Pfizer, Barrick Gold and Other Leading Companies for Handling Actual and Potential FCPA Whistleblowers,” The FCPA Report, Vol. 1, No. 11 (Nov. 7, 2012).

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  • From Vol. 2 No.12 (Jun. 12, 2013)

    A Guide to Disclosing Corruption Investigations in SEC Filings: Compendium of SEC Filings (Part Four of Four)

    This is the fourth and final article in The FCPA Report’s series on when and how public companies should disclose FCPA and other corruption issues in SEC filings.  In this article, we have organized (with help from Intelligize’s database and search tools) a compendium of actual FCPA-related disclosures from recent SEC filings.  The filings are grouped based on the type of event that triggered the initial disclosure, as follows: U.S. government subpoena; U.S. government inquiry; foreign government investigation; internal compliance discovery; whistleblower allegation; and post-acquisition due diligence.  These real-world examples of relevant disclosures can serve as precedents for counsel tasked with drafting or reviewing SEC filings relating to an FCPA issue.  To maximize the value of this compendium as a practice tool, this compendium also contains links to each of the filings discussed and quoted.  The first article in the series discussed factors that companies should consider when determining whether a public disclosure is appropriate; what experts a company should retain to help it make appropriate disclosure decisions; and the risks and benefits of disclosing at different stages of an anti-corruption investigation.  The second installment in the series detailed the risks inherent in disclosure and non-disclosure; addressed ways to diminish those risks, including handling media coverage; and discussed best practices when disclosing foreign investigations to the SEC.  The third article in the series provided insight on the most effective language to use in disclosures, and analyzed Wal-Mart’s disclosures at critical decision points in its recent investigation.

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  • From Vol. 2 No.7 (Apr. 3, 2013)

    How to Maintain an Anti-Corruption Reporting Hotline That Complies with Data Privacy Laws

    The November 2012 FCPA Resource Guide emphasized that a confidential reporting hotline is one of the hallmarks of an effective FCPA compliance program.  However, operating such a hotline requires a company to collect personal data about employees.  Accordingly, maintaining a reporting hotline may conflict with applicable data privacy laws, particularly in non-U.S. jurisdictions.  How can companies both abide by data privacy laws and maintain a reporting hotline, consistent with best compliance practices?  This article addresses this question and, in doing so, offers guidance on setting up a hotline; processing and investigating complaints; and post-investigation procedures.

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  • From Vol. 2 No.5 (Mar. 6, 2013)

    Facilitation Payments, Foreign Officials, Bona Fide Expenditures and More: Actionable Insight from the Authors of “Defending Clients in FCPA Investigations”

    Mark P. Goodman and Bruce E. Yannett, partners at Debevoise & Plimpton LLP, and Daniel J. Fetterman, a partner at Kasowitz, Benson, Torres & Friedman LLP, are the FCPA experts behind “Defending Clients in Foreign Corrupt Practices Investigations,” a chapter in the 2012 treatise “Defending Corporations and Individuals in Government Investigations.”  Their chapter addresses the hot button issues companies are facing today as the SEC and DOJ continue to increase the pressure on global companies to implement and enforce best of breed FCPA compliance programs.  Goodman and Fetterman recently shared their insight on some of these pressing issues with The FCPA Report.  In our interview, they discussed how far the FCPA’s jurisdiction reaches in light of recent case law and the FCPA Guidance, including the jurisdictional implications for aiders, abettors and conspirators; details regarding rewards under the new Dodd-Frank whistleblower provisions; who is a foreign official and whether it matters; how companies should handle facilitation payments; advice on reasonable business expenses after the Guidance; the concept of virtual strict liability in accounting violations of the FCPA; how judicial review will impact settlements; the collateral effects of an FCPA settlement; and when to self-report an FCPA violation.

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  • From Vol. 2 No.2 (Jan. 23, 2013)

    Specific Strategies from Goldman Sachs, Société Générale and Leading Law Firms on Conducting Cross-Border FCPA Investigations

    The considerable challenges posed by an internal FCPA investigation are compounded when that investigation involves a cross-border component – as it almost invariably does.  In-house and outside counsel in cross-border investigations must navigate legal regimes that often conflict (notably in the area of data privacy); divergent approaches to the attorney-client privilege; varying business and governance structures; and different languages and cultural mores.  Moreover, best practices in the area of cross-border investigations are not codified or neatly packaged; rather, they are a function of long and often arduous experience.  In an effort to identify and communicate some of those best practices, a seasoned panel of in-house and law firm lawyers convened in New York on January 15, 2013 for a panel hosted by Catalyst, an e-discovery services provider.  The panel was moderated by Vasu Muthyala, counsel at O’Melveny & Meyers LLP.  He was joined by Greg Andres, partner at Davis Polk & Wardell LLP; John Driscoll, Managing Director and Director of Litigation and Regulatory Affairs at Société Générale; Justin Shur, partner at Molo Lamken LLP; John Tredennick, Chief Executive Officer of Catalyst; and Christine Chi, Global Head of the Anti-Bribery Group at Goldman Sachs.  The panelists discussed, among other issues: major challenges facing companies performing cross-border investigations, including the differing notions of data privacy and attorney-client privilege in different regions and strategies for coordinating with multiple jurisdictions; tips for conducting a cross-border investigation, including when to retain outside counsel; and the dynamics of reporting, both obligatory reporting via a Suspicious Activity Report and voluntary disclosure, especially in the current whistleblower climate.

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  • From Vol. 2 No.1 (Jan. 9, 2013)

    Germany-Based Insurer Allianz Pays $12.3 Million to Resolve SEC’s Books and Records and Internal Controls FCPA Charges

    Allianz, a German insurance and asset management company that previously had bonds registered with the SEC, recently resolved charges that an Indonesian joint venture in which Allianz’s Indonesian subsidiary invested made improper payments to employees of state-owned entities between 2001 and 2008.  Allianz agreed to pay $12.3 million.  The case demonstrates the government’s interpretation of the jurisdictional reach of the FCPA, the importance of whistleblowers and the increasing prevalence of FCPA cases that do not implicate the FCPA’s anti-bribery provisions.  See also “Five Themes for General Counsel to Monitor with Respect to Dodd-Frank Whistleblowers and the FCPA,” The FCPA Report, Vol. 1, No. 9 (Oct. 3, 2012).

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  • From Vol. 1 No.12 (Nov. 14, 2012)

    Managing FCPA and Other Risks After Onboarding a Third Party

    A November 7, 2012 webinar sponsored by compliance and investigative software provider Catelas Inc. (Catelas) addressed steps that companies can take to manage FCPA and other compliance risks after they have “onboarded” a third party, i.e., conducted due diligence and formalized a business relationship with that party.  The webinar was moderated by Eddie Cogan, CEO & founder of Catelas.  The other speakers were Alan Morley, president of compliance risk consulting firm Adsideo LLC, and Michael Volkov, a shareholder at LeClairRyan.  This article summarizes the key points from that presentation.

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  • From Vol. 1 No.11 (Nov. 7, 2012)

    Specific Strategies from Pfizer, Barrick Gold and Other Leading Companies for Handling Actual and Potential FCPA Whistleblowers

    The SEC’s new whistleblower bounty program, promulgated under the Dodd-Frank Act, has altered litigation strategy and forced in-house counsel and compliance officers to revisit portions of their compliance policies to encourage would-be whistleblowers to report internally in lieu of, or before, going to the government.  On October 19, 2012, at the ABA’s Fifth Annual FCPA Institute in Washington, D.C., a group of in-house and outside counsel discussed how the whistleblower program has affected FCPA compliance policies, the challenges of handling and disciplining whistleblowers as well as recent caselaw interpreting the provisions.  For more on discipline considerations for anti-bribery professionals, see “When, Why and How Should Companies Discipline Employees for FCPA Violations?,” The FCPA Report, Vol. 1, No. 8 (Sep. 19, 2012).

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  • From Vol. 1 No.9 (Oct. 3, 2012)

    Five Themes for General Counsel to Monitor with Respect to Dodd-Frank Whistleblowers and the FCPA

    It’s late at night and General Counsel is giving the deck for the next morning’s Audit Committee presentation one final read through.  The subject of the presentation is a succinct yet thorough post-mortem report distilling the key findings from a wide-ranging internal investigation into irregularities relating to a major contract award in one of the company’s most challenging foreign markets.  There is sufficient evidence of questionable conduct to merit real concern under the FCPA and General Counsel, with Outside Counsel by her side, must make a recommendation to the Audit Committee as to whether the company should make a voluntary disclosure to U.S. authorities.  Flipping through the slides, General Counsel remarks to herself how familiar the facts have become, particularly the unattractive ones.  She is also well versed in the factors weighing on the pro and con side of disclosure.  But one wildcard prevents General Counsel from putting the presentation down and getting some much-needed rest: is there a whistleblower who has already informed the government?  If so, the company’s calculus is dramatically different.  But General Counsel just doesn’t know and that is one answer that Outside Counsel does not have for her.  Whistleblowers have long been a hot topic for corporate counsel.  They have become an even hotter topic since Congress passed Section 922 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank), which amended the Securities Exchange Act of 1934 to add new Section 21F, “Securities Whistleblower Incentives and Protection.”  In a guest article, F. Joseph Warin, chair of Gibson, Dunn & Crutcher LLP’s Washington, D.C. Litigation Department and co-chair of the Firm’s White Collar Defense and Investigations Practice Group, along with John W.F. Chesley, a litigation associate at Gibson Dunn, provide a brief primer on the regulatory framework governing whistleblower awards under Dodd-Frank; explore early developments in Dodd-Frank whistleblower litigation, with a particular focus on two important cases predicated upon alleged violations of the FCPA; and list some of the key issues that they see as emerging or that they expect to emerge in the near future.

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  • From Vol. 1 No.9 (Oct. 3, 2012)

    Anonymous Polling, Focus Groups and “Organizational Justice” Help Companies Avoid FCPA Violations While Growing Revenue

    The notion that anti-bribery compliance and revenue generation are at odds has a superficial appeal and a long tradition.  But the notion does not hold up under theoretical scrutiny, and it has been discredited empirically.  As a theoretical matter, it makes good sense that a culture of ethics and excellence leads to high long-term returns, while a culture of bribery leads to misallocation of resources, among other problems.  And as an empirical matter, deep research by CEB (formerly the Corporate Executive Board), along with CEB’s extensive advisory experience, highlight a strong correlation between long-term revenue growth and a corporate culture of integrity.  “Integrity capital,” as CEB calls it, is not just the right thing to do or, less charitably, applied sanctimoniousness.  Rather, it is good business and effective strategy.  Working from an interview with Tracy Davis Bradley, a senior director at CEB; a recent article by Dan Currell, an executive director at CEB, and Bradley in the Harvard Business Review; as well as research provided to The FCPA Report by CEB, this article sheds light on some of the footpaths connecting ethics and revenue.  In particular, this article outlines specific steps that companies can take to avoid FCPA violations while simultaneously driving business growth; why the shaky economy may be driving bribery in developing countries; how integrity capital can help businesses’ bottom lines; how companies can make their hotlines more effective; how anonymous polling and focus groups, if done well, can yield surprisingly good results; and why companies should not only consistently and quickly punish offenders, but give recognition to employees who report wrongdoing.

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  • From Vol. 1 No.9 (Oct. 3, 2012)

    LeClairRyan Webinar Highlights Ten Anti-Corruption Risks for Pharmaceutical and Medical Device Companies and Outlines the Elements of an Effective FCPA Compliance Program

    On September 19, 2012, Michael Volkov, a partner at LeClairRyan, hosted a webinar entitled “Anti-Corruption Risks for Pharmaceutical and Medical Device Companies.”  Volkov provided an overview of current trends in enforcement of the FCPA in the pharmaceutical and medical device industries and identified risk factors in FCPA compliance.  He also identified best practices associated with avoiding each risk factor and outlined the basic elements of a successful FCPA compliance program.

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  • From Vol. 1 No.6 (Aug. 22, 2012)

    New Delhi Television Action against Nielsen Highlights the Ability of Private Lawsuits to Serve as De Facto FCPA Whistleblower Complaints

    New Delhi Television Limited (NDTV) has filed a mammoth, 194 page complaint in New York State Supreme Court against principal defendants Nielsen Holdings N.V. and The Nielsen Company (together, Nielsen), Kantar Media Research PVT LTD. (Kantar), and their Indian joint venture, TAM Media Research Private Limited (TAM).  This suit appears to be the culmination of long-running efforts by plaintiff NDTV to challenge the reliability of television viewership data produced by defendant TAM.  NDTV claims that, to NDTV’s detriment, TAM’s ratings have been skewed by corruption and bribery for many years.  Although primarily a negligence and breach of contract suit, NDTV asserts one claim for “negligence per se” against Nielsen arising out of Nielsen’s alleged violation of the FCPA.  NDTV claims that many of the television stations that allegedly benefited from the corrupted ratings are owned by Indian politicians.  It claims total damages of more than $800 million.  This article summarizes the background of the dispute and NDTV’s FCPA theory of recovery, and highlights the manner in which private lawsuits may serve as de facto FCPA whistleblower complaints.

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  • From Vol. 1 No.3 (Jul. 11, 2012)

    Seven Steps Companies Can Take to Incentivize Internal Reporting of FCPA Violations

    When real or potentially unlawful conduct is occurring at a public company or regulated entity, learning of it in real time and addressing it quickly is critical to that entity’s ability to respond and manage reputational and financial fallout.  The Securities and Exchange Commission’s Whistleblower Rules (promulgated under Section 922 of the Dodd-Frank Wall Street Reform and Consumer Protection Act), which award whistleblowers a percentage of the penalty paid by the company to the SEC as a result of the information from the whistleblower, contain certain key provisions.  In a guest article, Thomas Sporkin, a Partner at BuckleySandler LLP, outlines seven ways in which these provisions can be leveraged by entities to incentivize whistleblowers to report information internally, thereby providing the company with additional time to properly understand, contain, remediate and, in certain instances, self-report potential violations of the federal securities laws, including the FCPA.  See “When and How Should Companies Self-Report FCPA Violations? (Part Two of Two),” The FCPA Report, Vol. 1, No. 2 (Jun. 20, 2012).

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  • From Vol. 1 No.2 (Jun. 20, 2012)

    When and How Should Companies Self-Report FCPA Violations? (Part Two of Two)

    Companies and individuals frequently face the question of whether to self-report FCPA violations.  Generally, parties self-report where they expect that the “credit” received for doing so will outweigh the various detriments (e.g., revealing a legal violation that otherwise might have gone unnoticed, losing control of an investigation, etc.)  Accordingly, implicit in any self-reporting determination is an estimate of the value of credit to be obtained.  Parties making such an estimate are, at least in theory, assigning a value to anticipated credit, then discounting that credit by the likelihood of obtaining it.  In practice, however, quantifying the value of credit to be obtained for self-reporting FCPA violations is a challenging exercise.  Various categories of credit – declinations and dropping of charges, for example – are hard to quantify; and assigning probabilities to government action is an infamously imprecise errand.  So, what are companies and individuals considering self-reporting to do?  The answer is to think through the self-reporting calculus in a structured, methodical way – to approach such decision-making with a workable framework.  To assist our subscribers in doing so, we have provided the building blocks of such a framework in this two-part article series.  In particular, part one of this series: provided a detailed definition of self-reporting; discussed relevant precedent, including plea agreements, settlements, speeches and fines; identified six questions that a company must answer before deciding whether or not to self-report; highlighted three of the chief arguments in favor of self-reporting; and analyzed whether and how the value of self-reporting can be quantified.  See “When and How Should Companies Self-Report FCPA Violations (Part One of Two),” The FCPA Report, Vol. 1, No. 1 (Jun. 6, 2012).  This part two addresses: the risks inherent in self-reporting; the likely effect of new FCPA insurance products on self-reporting; the mechanics of self-reporting (e.g., timing, to whom, who decides, etc.); and the impact on self-reporting determinations of the whistleblower provisions in the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.

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