The Anti-Corruption Report

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

Articles By Topic

By Topic: U.K. Bribery Act

  • From Vol. 7 No.21 (Oct. 17, 2018)

    Four Takeaways From the U.K.’s ENRC Privilege Decision

    Following the September 2018 decision of the English Court of Appeal in the ENRC case, the English law of privilege has moved more in line with the U.S. doctrine of attorney work product. While it will always be a fact-dependent determination, as a general rule, companies conducting investigations in the U.K. should now be able rely on the English doctrine of litigation privilege to protect their investigative work product from disclosure to the authorities. In a guest article, Ropes & Gray partners Amanda Raad and Judith Seddon and associates Matthew Burn and Sarah Lambert-Porter discuss the practical implications of the decision. See “No Need to Overreact: Protecting Privilege in the U.S. and U.K. After the ENRC Decision” (Jun. 21, 2017).

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  • From Vol. 7 No.16 (Aug. 8, 2018)

    Demonstrating That a Company Has “Adequate Procedures” Using ISO 37001 Certification

    The International Organization for Standardization’s (ISO) Anti-Bribery Standard (ISO 37001 or the Standard) is the first attempt by an international-standard-setting organization at helping companies create effective anti-bribery compliance programs. While no government agency has endorsed the Standard, the companies that have sought ISO certification for their programs are likely to be looked upon kindly by regulators. In this guest article, CRI Group training manager Aneta Nastaj discusses how ISO 37001 can help organisations meet those regulators’ expectations. See “Wal-Mart CECO Discusses the Retailer’s Decision to Seek ISO 37001 Certification” (Mar. 21, 2018).

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  • From Vol. 7 No.15 (Jul. 25, 2018)

    As the U.K. Bribery Act Turns Seven, Experts Take Its Pulse

    The U.K. Bribery Act has “evolved significantly over the course of the last seven years,” Greenberg Traurig shareholder Barry Vitou said at a recent Securities Docket program. He and other panelists offered insights on the upcoming changing of the guard at the SFO, the use and impact of deferred prosecution agreements, the pending House of Lords review of the Act and pending litigation over the scope of attorney-client privilege. See “Joint Head of Bribery at the SFO Discusses the Agency’s Priorities” (May 30, 2018).

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  • From Vol. 7 No.13 (Jun. 27, 2018)

    Anti-Corruption Enforcement Continues to Increase Around the World

    Once largely the province of U.S. authorities, anti-corruption enforcement has evolved into an international norm in recent years. Recently, the World Bank, regulatory agencies in the United Kingdom and several Latin American countries have each engaged in significant anti-corruption activity. In a guest article, Dechert attorneys Jeremy Zucker, Darshak Dholakia, Hrishikesh Hari, Jacob Grubman and Eric Auslander analyze recent anti-corruption efforts outside the United States. For more, see “How Significant Is the DOJ’s New Directive on Coordination?” (May 16, 2018).

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  • From Vol. 7 No.11 (May 30, 2018)

    Joint Head of Bribery at the SFO Discusses the Agency’s Priorities

    The massive Rolls-Royce settlement in 2017 put Britain’s Serious Fraud Office on the anti-corruption map, but how active will the agency continue to be and how will it coordinate with other jurisdictions in this era of international cooperation? Camilla de Silva, the SFO’s Joint Head of Bribery & Corruption, recently addressed the SFO’s priorities and how the investigation process works at a breakfast held by the ABA’s Criminal Justice Section Global Anti-Corruption Committee in Washington, D.C., as well as in recent remarks at the International Pharmaceutical and Medical Device Compliance Congress in Vienna. See “Are U.K. Enforcement Authorities Sending the Wrong Message to Companies?” (Oct. 18, 2017).

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  • From Vol. 7 No.5 (Mar. 7, 2018)

    What Companies Operating in Asia Need to Know About 2017 ABAC Settlements

    Though Latin America saw massive anti-corruption enforcement actions last year, anti-corruption developments in Asia should not be ignored. Recent actions involving conduct there highlight the increasing complexity and global coordination of anti-corruption efforts. In this guest article, King & Spalding attorneys Jason Jones, Grant Nichols and Jenna Stern explain the lessons to be gleaned from Asia-related FCPA enforcement matters for anti-corruption practitioners and clients by examining a handful of such matters from 2017, highlighting developing anti-corruption trends, and discussing their observations on global enforcement issues. See “Practitioners Take the Pulse of Anti-Corruption Compliance and Enforcement in China” (Mar. 15, 2017).

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  • From Vol. 6 No.20 (Oct. 18, 2017)

    Are U.K. Enforcement Authorities Sending the Wrong Message to Companies?

    To date, 2017 has been a record year for anti-corruption enforcement in the U.K. The last eight months of enforcement have included the largest ever fines for a company, the longest ever sentences for individuals and the greatest number of individuals convicted. In a guest article, Gibson Dunn’s Patrick Doris and Mark Handley analyze the recent developments, explain what the two most recent convictions of companies for corruption reveal about the current state of enforcement in the U.K. and what the government may be communicating to companies. See “SFO Arrives in the Anti-Corruption Premier League With Rolls-Royce Settlement” (Mar. 1, 2017).

     

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  • From Vol. 6 No.12 (Jun. 21, 2017)

    No Need to Overreact: Protecting Privilege in the U.S. and U.K. After the ENRC Decision

    Companies around the world conduct internal investigations to detect and remediate potential wrongdoing and often rely on privilege to keep their findings private. The recent United Kingdom case of Serious Fraud Office v Eurasian Natural Resources Corporation Limited sharply limits the scope of legal privilege in internal investigations and further divides the U.K. approach to privilege from the approach in the U.S. Yet, Ropes & Gray partners Amanda Raad, Kim Nemirow and Marcus Thompson, along with their colleagues Mair Williams and Tom Littlechild, advise companies not to panic in this guest article. Rather, they suggest three concrete steps companies can take to protect information uncovered during investigations. See “Rolls Settlement Illuminates SFO Expectations for Cooperation and Compliance” (Mar. 15, 2017).

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  • From Vol. 6 No.11 (Jun. 7, 2017)

    The Practical Privilege Implications of the ENRC Decision 

    The recent High Court of England and Wales’ judgment in The Serious Fraud Office v Eurasian Natural Resources Corporation dealt primarily with the question of whether documents produced during an internal investigation (in anticipation of a Serious Fraud Office investigation) were protected by privilege under English law. In a guest article, Matthew Getz, a partner in Boies Schiller Flexner’s London office, and associate Michael Jacobs analyze the ever-diminishing scope of legal professional privilege and detail practical considerations that parties should now bear in mind when creating documents in contemplation of regulatory investigations. See “What Compliance Lessons Can Companies Learn From the SFO’s First Two DPAs?” (Sep. 28, 2016).

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  • From Vol. 6 No.5 (Mar. 15, 2017)

    Rolls Settlement Illuminates SFO Expectations for Cooperation and Compliance

    Rolls-Royce’s recent settlement with U.K., U.S. and Brazilian authorities was a key development in global anti-corruption enforcement. The case opens a window into what the SFO, now a major player on the field of anti-corruption enforcement, expects from companies both in terms of cooperation and remediation. That information may prove crucial for many multinational companies as U.K. enforcement continues to assert its dominance on the anti-corruption stage. See “Rolls-Royce Settlement Offers Lessons on How to Pay Commissions Without Corruption” (Feb. 15, 2017) and “SFO Arrives in the Anti-Corruption Premier League With Rolls-Royce Settlement” (Mar. 1, 2017).

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  • From Vol. 6 No.4 (Mar. 1, 2017)

    SFO Arrives in the Anti-Corruption Premier League With Rolls-Royce Settlement

    The U.K.’s Serious Fraud Office has struggled for legitimacy in recent years, with a limited number of enforcement actions under its belt and a shrinking budget. But its recent settlement with Rolls-Royce has established it as a force to be reckoned with in global anti-corruption enforcement. “The settlement catapults the SFO into the Premier League of global anti-bribery law enforcement,” said London-based Barry Vitou, head of Pinsent Masons’ corporate crime team. But is it sending mixed messages about the value of cooperation and self-reporting? For more on the settlement, see “Rolls-Royce Settlement Offers Lessons on How to Pay Commissions Without Corruption” (Feb. 15, 2017).

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  • From Vol. 6 No.3 (Feb. 15, 2017)

    Rolls-Royce Settlement Offers Lessons on How to Pay Commissions Without Corruption

    Rolls-Royce’s recent massive settlement with U.S., U.K. and Brazilian authorities is a stark reminder of the anti-corruption risks associated with intermediaries, agents and fixers when negotiating contracts with state-owned entities. Commissions paid by Rolls-Royce to its agents – including notorious oil-and-gas “solutions” provider Unaoil – often were eventually passed on to foreign officials to close deals, netting Rolls-Royce a global settlement for hundreds of millions of dollars. In this first article discussing the case, we look at the bribes Rolls-Royce paid, how its compliance program failed to prevent them and what companies can do to make sure that commissions paid to agents are not used improperly. In a second article, we will look at the implications for cooperative U.S. and U.K. enforcement and what the SFO is looking for in terms of cooperation and remediation. See “Bribery Act Experts Discuss the Impact of Brexit, DPAs and Other U.K. Developments” (Jul. 13, 2016).

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  • From Vol. 5 No.19 (Sep. 28, 2016)

    What Compliance Lessons Can Companies Learn From the SFO’s First Two DPAs?

    In July 2016, the U.K.’s Serious Fraud Office received court approval for its second-ever DPA. Both this DPA and the one before it, involving Standard Bank, are stark demonstrations of the fact that violating the U.K. Bribery Act can have serious and expensive ramifications not only for the offending company but also for others in its corporate group, even if they were unaware of the bribery. They also serve as another reminder of the dangers of using agents to win business. In a guest article, Matthew Getz and Prateek Swaika, partner and associate, respectively, at Boies, Schiller & Flexner, consider some of the lessons to be learned in this context, and what companies operating in the U.K. should do to avoid incurring liability when using agents to enter into contracts. See also “In Second DPA, SFO and U.K. Court Focus on Cooperation, Self-Reporting and Compliance” (Aug. 31, 2016).

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  • From Vol. 5 No.17 (Aug. 31, 2016)

    In Second DPA, SFO and U.K. Court Focus on Cooperation, Self-Reporting and Compliance

    Recently a U.K. court approved the second Serious Fraud Office application for a DPA. The identity of the counterparty remains confidential but is understood to be a small to medium-sized U.K. entity wholly owned by a U.S. corporation. The first DPA which was approved by the same judge in November 2015, was with Standard Bank, a regulated institution that settled for what could be perceived as a more stringent penalty. More recently, financially troubled Sweett Group was prosecuted after failing to cooperate in the SFO’s investigation. In a guest article, Elizabeth Robertson, a partner at Skadden located in London, discusses the key features of the most recent DPA and examines the differences between it, the Standard Bank case and the Sweett Group case offering insights on anti-corruption enforcement in the U.K. See “Lessons From the U.K. Sweett Group Prosecution” (Mar. 23, 2016).

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  • From Vol. 5 No.14 (Jul. 13, 2016)

    Bribery Act Experts Discuss the Impact of Brexit, DPAs and Other U.K. Developments

    In the five years since the U.K. Bribery Act took effect, there have been few prosecutions but, according to Pinsent Masons partner Barry Vitou, speaking at a recent Securities Docket webinar, now is “exactly the wrong moment” to become complacent about compliance. In fact, after the webinar, on July 8, 2016, a judge approved a deferred prosecution agreement between the Serious Fraud Office and an unnamed company to resolve bribery charges in a case that is ongoing against individuals. Vitou, along with Julian Glass, a managing director at FTI Consulting, Richard Kovalevsky QC and Vivian Robinson QC, a partner at McGuireWoods and former general counsel to the U.K.’s Serious Fraud Office, discussed recent developments in the U.K. of concern to companies, including the impact of Brexit on anti-corruption compliance and the SFO’s use of DPAs. See “SFO’s Alford Discusses Enforcement Priorities, Deferred Prosecution Agreements and Corporate Criminal Liability” (Jun. 15, 2016).

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  • From Vol. 5 No.12 (Jun. 15, 2016)

    SFO’s Alford Discusses Enforcement Priorities, Deferred Prosecution Agreements and Corporate Criminal Liability

    In light of events such as the first convictions under the U.K. Bribery Act and the first British corporate deferred prosecution agreement, how does the U.K.’s Serious Fraud Office (SFO) see its role on the domestic and international law enforcement stage? In remarks at the American Conference Institute’s recent New York Conference on the FCPA, Stuart Alford, QC, the Head of Division of the SFO, explained the operations and priorities of the SFO, with emphasis on its role in anti-corruption enforcement, deferred prosecution agreements and corporate criminal liability. See also “U.K. Anti-Corruption Summit Brings Criticism and a Touch of Déjà Vu” (Jun. 1, 2016).

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  • From Vol. 5 No.11 (Jun. 1, 2016)

    U.K. Anti-Corruption Summit Brings Criticism and a Touch of Déjà Vu

    On May 12, 2016, the U.K. hosted a much-publicized Global Anti-Corruption Summit (Summit) in London. This was not, as some believed, a response to the leak of confidential records from the Panamanian law firm Mossack Fonseca, but an event that had been announced by U.K. Prime Minister David Cameron in a speech in Singapore on July 28, 2015, about tax evasion and tax avoidance. In a guest article, Collingwood Thompson, a barrister at London-based 7BR, explains how an emphasis on tax evasion and tax avoidance led to the Summit and discusses the key takeaways and controversies arising out of the event. See also OECD Working Group’s 2013 Report on Global Anti-Bribery Efforts Shows Lackluster Performance” (Jun. 26, 2013). 

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  • From Vol. 5 No.7 (Apr. 6, 2016)

    Compliance Professionals Share Insights on Revitalizing Codes of Conduct

    A company’s code of conduct is the bedrock of a strong compliance program but it cannot be set in stone. Companies need to reevaluate and periodically update their codes to ensure their relevance. A recent panel discussion at Ethisphere’s 8th Annual Global Ethics Summit looked at the experiences of three large corporations in updating and upgrading their codes of conduct, focusing on the key issues they faced in the process. The program was moderated by Ed Petry, vice president at NAVEX Global, and featured Megan Belcher, vice president and chief counsel at ConAgra Foods, Bettye J. Hill, vice president and chief ethics and compliance officer at Oshkosh Corporation, and Peter Loftspring, assistant general counsel and chief compliance manager at Black & Veatch Corporation. This article summarizes the key takeaways from the program. See also “Customizing Codes of Conduct to Spread the Message of Compliance” (Mar. 4, 2015); and “Six Steps to Revitalize the Company Compliance Code” (Aug. 20, 2014).

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  • From Vol. 5 No.6 (Mar. 23, 2016)

    Lessons From the U.K. Sweett Group Prosecution

    The U.K.’s Serious Fraud Office has completed its first prosecution under Section 7 of the Bribery Act 2010. The Sweett Group PLC was sentenced and ordered to pay £2.25 million after having admitted to failing to prevent bribery by its foreign subsidiary, Cyril Sweett International Ltd. The sentence follows the SFO’s first deferred prosecution agreement, announced last November. Several years after the Act’s introduction, and after some criticism that it has not led to prosecutions, it is slowly beginning to bear fruit. In a guest article, James Maton and Jamie Humpreys, partner and associate in Cooley’s London office, discuss the key takeaways from the decision. See also “SFO Secures First Bribery Act Convictions” (Dec. 17, 2014).

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  • From Vol. 5 No.3 (Feb. 10, 2016)

    Analyzing the Significance of the U.K. Court of Appeals Decision Allowing Pre-Bribery Act Prosecution

    The U.K. Court of Appeals has given a green light to a case alleging foreign bribery prior to the adoption of the 2010 U.K. Bribery Act, holding that the 1906 Prevention of Corruption Act applies. How much does this ruling open the door for U.K. prosecutors to charge pre-2010 foreign bribery? In a guest article, Sally J. March, a director at Drummond March Ltd, explains the case and its significance for anti-corruption enforcement in the U.K. See also “The Meaning of the U.K.’s First DPA” (Dec. 16, 2015).

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  • From Vol. 4 No.26 (Dec. 16, 2015)

    The Meaning of the U.K.’s First DPA

    Deferred Prosecution Agreements became available in the United Kingdom on February 24, 2014.  Some 18 months later, on November 30, 2015, Lord Justice Leveson approved the first one between the SFO and Standard Bank.  In a guest article, Nicola Howard, a Barrister at 25 Bedford Row, and Jonathan Armstrong and André Bywater, lawyers with specialist compliance practice Cordery, explain how the Deferred Prosecution Agreement process works in the U.K., detail the Standard Bank case and examine what the case means for future corporate settlements.  See “Standard Bank Fined by Both the SEC and the SFO in a Coordinated Settlement Featuring the First British DPA,” The FCPA Report, Vol. 4, No. 25 (Dec. 2, 2015).

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  • From Vol. 4 No.25 (Dec. 2, 2015)

    Standard Bank Fined by Both the SEC and the SFO in a Coordinated Settlement Featuring the First British DPA 

    A court in London has approved the Serious Fraud Office’s first DPA in a case involving Standard Bank’s failure to prevent the bribery of Tanzanian officials.  The bank will pay $32.6 million in fines for alleged Bribery Act violations which allowed the bank to win a lucrative private placement deal.  The SEC announced a coordinated settlement fining Standard Bank $4.2 million for failing to disclose the same payments in violation of Section 17(a)(2) of the Securities Act.  Although there are many lessons to be learned from Standard Bank’s agreement, the matter is a “relatively small case” and the DPA is “an incredibly new animal” in the U.K., said Ryan Junck, a partner in Skadden’s London offices.  “Much of the story about when and how DPAs will be used is yet to be written,” he said.  See also “SFO Secures First Bribery Act Convictions,” The FCPA Report, Vol. 3, No. 25 (Dec. 17, 2014).

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  • From Vol. 4 No.16 (Aug. 5, 2015)

    Regional Risk Spotlight:  Thomas Firestone of Baker & McKenzie Explains How to Navigate Corruption Risks in Russia

    When conducting business in Russia, multi-national companies often find themselves in the precarious position of trying to comply with local laws or traditions that conflict with international anti-corruption obligations.  Implementing policies that address this conflict in today’s political climate is a daunting task.  In this installment of The FCPA Report’s Regional Risk Spotlight series, we talk to Thomas Firestone, a partner at Baker & McKenzie, about the most pressing corruption issues in Russia and how companies doing business there can mitigate those risks using their compliance programs.  See also “Regional Risk Spotlight: William McGovern of Kobre & Kim Advises on How to Handle Corruption Risk When Doing Business in China,” The FCPA Report, Vol. 4, No. 14 (Jul. 8, 2015).

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  • From Vol. 4 No.7 (Apr. 1, 2015)

    From Princelings to SWFs: All-Star Panel Dissects Corruption Issues Affecting Wall Street

    For financial institutions and the private funds industry, corruption risks lurking in common activities are coming to the forefront.  At the New York City Bar, a distinguished panel of former prosecutors and industry experts offered insights into those evolving risks (including hiring practices and sovereign wealth funds), the enforcement landscape and how companies can strengthen their compliance programs in response.  The panel was moderated by John D. Buretta, a partner at Cravath, Swaine & Moore and former Assistant U.S. Attorney and Principal Deputy Assistant Attorney General at the DOJ.  The other speakers were Sarah Coyne, counsel at Debevoise & Plimpton and a former Assistant U.S. Attorney in the Eastern District of New York and Chief of the Business and Securities Fraud Section; Kelly B. Kramer, a partner at Mayer Brown; Claudius O. Sokenu, a partner at Shearman & Sterling and former SEC Senior Counsel; and Linda Chatman Thomsen, a partner at Davis Polk & Wardwell and former SEC Director of Enforcement.  See also “Friendly Relations? When Nepotism May Violate the FCPA,” The FCPA Report, Vol. 1, No. 10 (Oct. 17, 2012).

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  • From Vol. 4 No.6 (Mar. 18, 2015)

    Taking Third Party Diligence Beyond the FCPA and the U.K. Bribery Act

    An active third-party due diligence program protects a company from a host of dangers, including anti-corruption violations, sanctions issues and forming relationships with destructive business partners.  A recent program presented by the Society of Corporate Compliance and Ethics highlighted the continued importance of third-party due diligence for anti-corruption compliance and the impact of economic sanctions regimes on that due diligence.  The program featured Candice D. Tal, founder and Chief Executive Officer of security and risk management consulting firm Infortal Worldwide Inc.; and Cordery Compliance Limited’s principal adviser André Bywater and partner Jonathan P. Armstrong.  See also “Risk-Based Solutions to Complying with Anti-Money Laundering, Export Controls, Economic Sanctions and the FCPA,” The FCPA Report, Vol. 3, No. 2 (Jan. 22, 2014).

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  • From Vol. 4 No.4 (Feb. 18, 2015)

    Navigating Corruption Challenges in India

    With its lucrative domestic market, skilled workforce and competitive labor costs, India presents enticing investment opportunities but also significant corruption risk.  The corruption landscape there is a dynamic one, however, with citizens of the world’s largest democracy questioning the ability of elected representatives to serve the national interest and pushing for reform.  In a guest article, Ropes & Gray attorneys Alexandre H. Rene, Kim B. Nemirow and Nikhil Sud discuss the extent and nature of corruption in India; recent and ongoing efforts to fight corruption; and three steps that will help foreign investors successfully navigate the risks India poses and tap into India’s fertile market.  See also “Doing Business in India: Avoiding Corruption Risks and Monitoring Compliance Programs,” The FCPA Report, Vol. 3, No. 12 (Jun. 11, 2014).

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  • From Vol. 3 No.25 (Dec. 17, 2014)

    SFO Secures First Bribery Act Convictions

    Facing criticism for a lack of enforcement of one of the world’s toughest bribery laws, Britain’s Serious Fraud Office has secured its first convictions under the U.K. Bribery Act.  Three individuals were sentenced December 8, 2014 for the scheme involving fake investments in green biofuel.  Charges for two of the men included giving and receiving commercial bribes.  In a guest post, James Maton, Jamie Humphreys and Chimé Metok Dorjee, attorneys in Edwards Wildman Palmer’s London office, analyze the case and what it may mean for U.K. Bribery enforcement.  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.22 (Nov. 5, 2014)

    U.K. Practitioners Discuss Trends and Prosecutions Under the Bribery Act

    The U.K.’s Bribery Act of 2010 has broad extraterritorial reach, and prohibits a wider range of conduct than the FCPA, making awareness of its enforcement and interpretation important for many multi-national companies.  A recent program organized by the Society of Corporate Compliance and Ethics (SCCE) provided an update on the Bribery Act from experienced U.K. practitioners.  Margaret Hambleton, CCO of Dignity Health and SCCE Board Member, hosted the program.  The speakers were Jonathan Armstrong, a partner in U.K. solicitors firm Cordery Legal Compliance, and André Bywater, a principal advisor at that firm.  See also “Corruption Risks and Anti-Corruption Strategies in the E.U.,” The FCPA Report, Vol. 3, No. 10 (May 14, 2014).

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  • From Vol. 3 No.15 (Jul. 23, 2014)

    Strategies for Negotiating FCPA Settlements: An Interview with Neil MacBride, Davis Polk Partner and Former U.S. Attorney

    Demonstrating to the SEC and/or the DOJ that a company is committed to compliance and that it has addressed whatever program deficiencies led to the violation is critical in FCPA settlement negotiations.  A failure to convince the government that it is trustworthy can result in, among other things, larger fines, the appointment of an expensive corporate monitor and a larger disgorgement figure.  In an interview with The FCPA Report, Neil MacBride, a partner at Davis Polk and former U.S. Attorney for the Eastern District of Virginia, shared his strategies for negotiating effectively with the government.  Drawing from his extensive experience, both as a prosecutor and a defense attorney, MacBride discussed the mechanics of meeting with the government, the self-reporting calculus, international double jeopardy and more.  See our previous interview in this series, “Strategies for Negotiating FCPA Settlements: An Interview with Laurence Urgenson, Mayer Brown Partner and Former DOJ Official,” The FCPA Report, Vol. 3, No. 14 (Jul. 9, 2014).

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  • From Vol. 3 No.13 (Jun. 25, 2014)

    British Bankers’ Association Provides Guidance to Help Financial Institutions Avoid Liability Under the U.K. Bribery Act

    The British Bankers’ Association (BBA), the trade association for the U.K.’s banking and financial services sector, has recently refreshed its guidance on the steps that banks should take to comply with the U.K. Bribery Act 2010.  Despite its industry focus, the BBA Guidance contains a number of recommendations that will be valuable to any large company when implementing an anti-bribery compliance program.  In a guest article, Jeremy Cole and Alex Hohl, consultant and senior associate, respectively, in Hogan Lovells’ London office, provide a recap of some of the key features of the Bribery Act and consider the role of the U.K.’s financial regulator in pushing companies to take the implementation of anti-bribery measures seriously.  They also examine the BBA Guidance, which not only builds on the official guidance on anti-bribery compliance published by the U.K.’s Ministry of Justice in March 2011, but also looks beyond the Bribery Act to take into account the requirements that the U.K.’s regulatory regime places on financial institutions in this area. See “Corruption Risks and Anti-Corruption Strategies in the E.U.,” The FCPA Report, Vol. 3, No. 10 (May 14, 2014).

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  • From Vol. 3 No.12 (Jun. 11, 2014)

    Mitigating FCPA Risks Associated with Incentive Awards to Third Parties

    The use of incentive awards to recognize outstanding sales staff, dealers or downstream business partners who market or sell a company’s goods and services is a well-established business practice.  Such incentive awards can take the form of cash, gifts or vouchers for retail shopping, travel and dining.  For top sales staff or dealers, the incentive may be an off-site retreat that includes both training, promotion of products and services, and hospitality.  In a guest article, Adam Safwat, counsel at Weil, Gotshal & Manges, explains that when transparently administered between commercial parties, such incentive awards can be legitimate promotional activities without any intent on the part of the sponsor to corruptly influence the recipient’s conduct.  When the incentive awards are given to sales staff of state enterprises, however, there is a risk they may transgress the FCPA.  See also Gifts, Travel, Entertainment and Anti-Corruption Compliance: Sources of Authority, Best Practices and Benchmarking,” The FCPA Report, Vol. 2, No. 22 (Nov. 6, 2013).

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  • From Vol. 3 No.10 (May 14, 2014)

    Global Enforcement Developments Evaluated by FCPA Experts

    What are the FCPA and global anti-corruption trends that companies should be focusing on as they review and enhance their compliance programs?  A recent panel at the Dow Jones Global Compliance Symposium, moderated by Rachel Ensign from the Wall Street Journal and featuring Martin T. Biegelman, an Executive Vice President at IPSA International; Michael J. Hershman, President and CEO of The Fairfax Group; and Paul E. Pelletier, a member of Mintz Levin, highlighted some of the important developments.  See also “Assessing the Year in FCPA Enforcement and Looking Ahead,” The FCPA Report, Vol. 3, No. 2 (Jan. 22, 2014).

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  • From Vol. 3 No.10 (May 14, 2014)

    Corruption Risks and Anti-Corruption Strategies in the E.U.

    Europe may not be an emerging market, but, as the European Commission’s first Anti-Corruption Report detailed, there are pervasive corruption risks in Europe that companies must navigate; risks made more pressing by increased anti-corruption enforcement in the E.U. as well as the evolving requirements of the laws there.  In a recent Strafford Publications webinar, K&L Gates partner Edward J. Fishman, along with associates Laura Atherton from the firm’s London office and Isabelle De Smedt from the firm’s Brussels office, examined the corruption risks in the region and offered strategies for mitigating those risks.  The panelists reviewed the E.C.’s February Anti-Corruption Report, the related climate of corruption and the existing corruption laws and shared best practices for an effective compliance program.  See also “Eye-Opening Report Helps Companies Tackle European Corruption Risks,” The FCPA Report, Vol. 3, No. 6 (Mar. 19, 2014).

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  • From Vol. 3 No.6 (Mar. 19, 2014)

    Eye-Opening Report Helps Companies Tackle European Corruption Risks  

    "Breathtaking” is how one European Commissioner characterized the corruption described in the European Commission’s February 2014 Anti-Corruption Report, which details each E.U. Member State’s efforts in fighting corruption and provides advice for improving the effectiveness of those efforts.  In a guest article, Antonio Suarez-Martinez and James Maton, partners in Edwards Wildman Palmer LLP’s London office, analyze the Report and the relevant takeaways for companies doing business in Member States.  For more insight from Edwards Wildman, see “Collateral Consequences of Bribery: When Can Ethical Competitors Initiate Suit in the U.S. and U.K.?,” The FCPA Report, Vol. 2, No. 10 (May 15, 2013).

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  • From Vol. 3 No.5 (Mar. 5, 2014)

    Deferred Prosecution Agreements Come into Force in the U.K.

    The U.K. will now be using Deferred Prosecution Agreements to resolve certain cases.  Similar to U.S.-styled DPAs, British DPAs are agreements between prosecutors and corporations that charges will be presented but not pursued, provided the organization complies with a set of agreed-upon terms and conditions.  Those terms and conditions generally involve payment of substantial fines and/or the implementation of remediation programs.  In a guest article, Elizabeth Robertson, Laura Atherton and Sasi-Kanth Mallela, partner, associate and special counsel, respectively, in K&L Gates’ London office, say that the advent of DPAs will be broadly welcomed by the business community but their application in the U.K. will not be without its controversies.   They consider some of the issues likely to arise as DPAs, which will be implemented in some significantly different ways than they are in the U.S., find their feet in the U.K.  See 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. 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)

    Nine Steps to Reduce Corruption Risk When Entertaining Clients at the 2014 Winter Olympics and Beyond

    In recent years, the SEC and DOJ have launched multiple anti-corruption investigations relating to corporate hospitality during major sporting events, such as the Olympics and the World Cup.  While anti-corruption laws do not generally prohibit travel, gifts or entertainment of customers for legitimate business purposes, the line between a bona fide business expense and one that might attract scrutiny from U.S. and other regulators can be grey.  In advance of this week’s Olympics in Sochi, Russia and the upcoming World Cup in Brazil, Kimberly A. Parker, Jay Holtmeier, Erin G.H. Sloane, Daniel F. Schubert, partners at WilmerHale, provide nine recommendations to help companies mitigate possible anti-corruption risk attendant to this type of corporate hospitality.  See also “Ten Strategies for Paying for Government Clients to Attend the Olympics or Other Sporting Events without Violating the Foreign Corrupt Practices Act,” The FCPA Report, Vol. 1, No. 1 (Jun. 6, 2012).

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  • From Vol. 3 No.3 (Feb. 5, 2014)

    A Comparison of Anti-Bribery Laws in the U.S., U.K., China, Germany and India

    In this era of increasing international cooperation, anti-corruption compliance programs cannot consider only the FCPA.  Various anti-bribery regimes must be addressed in a multi-national company’s program to adequately protect the company from the growing threat of global enforcement and “carbon copy” prosecutions.  This chart, developed by T. Markus Funk and Sambo “Bo” Dul, partner and associate, respectively, at Perkins Coie LLP, helps with the task of creating a comprehensive anti-bribery program by comparing the main provisions of five anti-bribery laws that companies should be wary of – laws in the U.S., the U.K., China, Germany and India.  See “Assessing the Year in FCPA Enforcement and Looking Ahead,” The FCPA Report, Vol. 3, No. 2 (Jan. 22, 2014) (T. Markus Funk and Bo Dul).

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  • From Vol. 2 No.22 (Nov. 6, 2013)

    Five Lessons from 2013 FCPA Enforcement: Transaction Monitoring, International Cooperation, Documenting Hiring Decisions, Risk Assessments and Individual Prosecutions

    It has been a busy year for FCPA enforcement – the government has prosecuted individuals for violating the FCPA, used aggressive criminal investigation techniques to build cases and continued to increase its cooperation with foreign governments.  In a recent webinar hosted by The Network, Tom Fox shared his insight into recent FCPA trends and provided tips for FCPA compliance arising from those trends.  See also “Seven Key Trends That Are Changing the FCPA Enforcement and Compliance Landscape,” The FCPA Report, Vol. 2, No. 14 (Jul. 10. 2013).

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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.20 (Oct. 9, 2013)

    Survey Reveals the Contours and Content of Bribery in the U.K. Construction Industry

    Forty-nine percent of U.K. construction professionals believe that corruption is common within the U.K. construction industry, a decrease of 2% since 2006.  That was one of the key findings of a survey conducted and published in September by the Chartered Institute of Building (CIOB), the world’s largest professional body for construction management and leadership.  CIOB’s findings indicate several potential reasons for those levels of corruption.  The majority of construction professionals who believe that corruption is a problem in the U.K. cited economic issues as the primary reason for this phenomenon.

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  • From Vol. 2 No.18 (Sep. 11, 2013)

    Anti-Corruption Professionals from GE, Abbott Laboratories and Navistar Share Proven Strategies on Third-Party Due Diligence, M&A, Training, Nepotism and Regional Risk

    Anti-corruption compliance can feel like a battlefield, with potential landmines at every turn.  But what do practicing in-house compliance professionals view as their biggest challenges?  What issues keep them up at night?  And, most importantly, what have they done to address those issues?  In a panel hosted by the American Conference Institute, three in-house compliance experts shared their practical experience.  They discussed specific challenges they have faced and outlined the strategies they used to effectively address those challenges.  The expert panelists included Matthew Hsu, Senior Counsel, Global Fraud and Anti-Corruption at Abbott Laboratories; Shannon Masson, Senior Counsel at Navistar, Inc.; and Kevin Matthews, Associate General Counsel at GE Oil and Gas.  See also “Insight from Top Companies and Practitioners on How They Are Addressing Current Anti-Corruption Issues, from Self-Reporting to Risk Assessments to Training,” The FCPA Report, Vol. 2, No. 10 (May 15, 2013).

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  • From Vol. 2 No.15 (Jul. 24, 2013)

    U.K. Practitioners Discuss the Prospect of Enforcement Actions Under the U.K. Bribery Act, Advantages of Deferred Prosecution Agreements and Proposed Sentencing Guidelines

    What was all the fuss about?  The U.K. Bribery Act was adopted in 2010 and took effect in 2011.  Since then, there have been no prosecutions of corporations under the Act and only two formal investigations are known to be underway.  Experienced U.K. practitioners warn that the “fuss” may be proven justified soon, however, and companies should not be complacent.  In a recent webinar, experts cautioned that “enforcement is coming.”  They also discussed the availability of DPAs under the Bribery Act, the continuing utility of civil recovery orders and the proposed sentencing guidelines issued with respect to the Bribery Act.  This article summarizes the key lessons from the webinar.  See also Strategies for Implementing the U.K. Bribery Act’s Requirement of Adequate Procedures for Intermediaries,” The FCPA Report, Vol. 2, No. 3 (Feb. 6, 2013).

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  • From Vol. 2 No.11 (May 29, 2013)

    Top Government and Private FCPA Practitioners Discuss Global Enforcement, Self-Reporting, Facilitation Payments, M&A Due Diligence, Jurisdiction and NPAs

    It’s been a busy year in FCPA compliance and enforcement – including leadership changes at the DOJ; the SEC’s first-ever NPA; an apparent decline in enforcement actions followed by a recent upswing; a growing, active global anti-corruption community; a new Canadian anti-corruption regime; and increased emphasis on merger and acquisition due diligence in the private sector, among other things.  At a recent panel hosted by the Practising Law Institute during its “Foreign Corrupt Practices Act and International Anti-Corruption Law Developments 2013” program, distinguished FCPA lawyers in both the private and public spheres distilled the most important trends in the field – and sometimes disagreed about what they mean for both outside and in-house counsel who deal with anti-corruption issues.  Mark Mendelsohn, partner at Paul, Weiss, Rifkind, Wharton & Garrison LLP moderated the May 2, 2013 panel, with help from Richard Grime, a partner at O’Melveny & Myers LLP.  The panel was comprised of Roger Witten of WilmerHale and Danforth Newcomb of Shearman & Sterling LLP on the private side, and Jason Jones, Assistant Chief of the FCPA Unit, Fraud Section, Criminal Division at the DOJ, and Charles Cain, Deputy Chief, FCPA Unit, Division of Enforcement at the SEC, on the public side.

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  • From Vol. 2 No.10 (May 15, 2013)

    Collateral Consequences of Bribery: When Can Ethical Competitors Initiate Suit in the U.S. and U.K.?

    The potential fines and costs arising from corporate bribery can be sizeable.  But there is another risk for companies that have won government contracts because they bribed foreign officials: private lawsuits brought by clean competitors that have lost out on business as a result of bribery.  In an age of ever-increasing public information about bribery, from governments, non-governmental organizations, anti-corruption activists and others, competitors on the losing side of bidding processes have more evidence to pursue these claims.  In a guest article, Steve Huggard and James Maton, partners, and Katie Guarino, associate, at Edwards Wildman Palmer LLP, explain how suits against bribing competitors can be initiated and what is at stake.

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  • From Vol. 2 No.8 (Apr. 17, 2013)

    FCPA Training That Works: An Interview with Billy Jacobson, Chief Compliance Officer of Weatherford International

    Creating and deploying best-in-class training is a fundamental aspect of maintaining a successful anti-corruption compliance program, and a robust training program can be a powerful defense if the SEC or DOJ finds a “rogue employee.”  But training is inherently limited – training sessions cannot cover the full range of anti-corruption situations an employee may face across geographies, and the sessions themselves are limited by time and cost.  How can a company maximize the impact of this important activity?  To answer this and related questions, The FCPA Report is undertaking a series of interviews on FCPA training with experts from different disciplines.  This article – the second installment in the series – includes our interview with Billy Jacobson, Senior Vice President, Co-General Counsel and Chief Compliance Officer of Weatherford International, one of the largest oil and natural gas service companies, operating in 100 countries.  Prior to his association with Weatherford, Jacobson served as a federal prosecutor for the Fraud Section of the U.S. Department of Justice’s Criminal Division, where he served in various positions, including as Assistant Chief for FCPA Enforcement.  He has also been in private practice as a partner at Fulbright & Jaworski L.L.P.  In the first installment of this series, The FCPA Report spoke with Joseph Spinelli, the head of Navigant’s FCPA practice and former Inspector General of New York State.  See “FCPA Training That Works: An Interview with Joseph Spinelli, Global Leader of Navigant’s Anti-Bribery & Corruption-FCPA Segment,” The FCPA Report, Vol. 2, No. 7 (Apr. 3, 2013).

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  • From Vol. 2 No.7 (Apr. 3, 2013)

    Lessons from the Latest Anti-Corruption Developments in the U.K., Brazil and China

    A single-minded focus on the FCPA with a passing nod to other countries’ regulatory regimes is not enough to make a company’s compliance program first-in-class today; multinational companies must fully address an array of global anti-bribery laws in an environment of growing global enforcement and increased prosecutorial vigor.  Regulatory regimes in other countries may not be consistent with existing company compliance programs.  In a recent webinar, partners from Hogan Lovells shared their insight and experience on navigating the latest global developments in anti-bribery and corruption regulation and enforcement.  This article conveys the highlights from the discussion, focusing primarily on the anti-corruption regimes in China, the U.K. and Brazil.

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  • From Vol. 2 No.3 (Feb. 6, 2013)

    Strategies for Implementing the U.K. Bribery Act’s Requirement of Adequate Procedures for Intermediaries

    Intermediaries are crucial to many businesses, sometimes even mandatory, and are replete with corruption risk – under both the FCPA and the U.K. Bribery Act, they can generate criminal liability for their principals if they bribe to win business.  In many jurisdictions, intermediaries are routinely used to enter markets; to identify opportunities; to access and build relationships with decision-makers responsible for awarding contracts, including public officials; to assist with navigating complex local laws, regulations and customs; and to win business.  How can a company mitigate the risks these ubiquitous third parties pose?  In a guest article, James Maton, a partner in Edwards Wildman Palmer UK LLP’s London office, provides strategies to that end by reference to the requirements of the U.K. Bribery Act, one of the most comprehensive anti-bribery statutes in the world, with broad application to global activities connected to the U.K.  It requires companies and partnerships to have adequate procedures intended to prevent bribery in both their private and public sector business activities.  Maton’s article considers the key principles that should underpin those procedures, and the steps an organisation can take to reduce the bribery risks posed by intermediaries.

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  • From Vol. 1 No.14 (Dec. 12, 2012)

    Recent Developments in U.K. Bribery Act Enforcement: SFO Head Green Speaks, Abbot Group Settles and Rolls-Royce Reveals Bribery Investigation

    There is growing concern that the U.K. Bribery Act 2010 (Bribery Act), which took effect in July 2011, may pose more serious risks for multinational businesses than the FCPA.  This is due, in part, to the fact that the Bribery Act extends to private as well as government bribery and does not have an exception for “facilitating payments.”  On November 13, 2012, David Green CB QC, who is the Director of the U.K.’s Serious Frauds Office (SFO), gave testimony before the Justice Committee of the House of Commons.  His testimony provides insight into how, under his direction, the SFO may be expected to approach anti-corruption efforts in general, and enforcement of the Bribery Act in particular, especially with regard to self-reporting and deferred prosecution agreements.  In other recent U.K. developments, Scotland’s Crown Office and Procurator Fiscal Service announced its first-ever civil settlement.  The government reached an agreement with Abbot Group Limited arising out of overseas corrupt payments, and Rolls-Royce plc announced that it had reported to the SFO information with respect to bribery and corruption involving overseas intermediaries.  This article highlights the key take-aways of Green’s testimony that are relevant to anti-bribery enforcement and summarizes the Abbot and Rolls-Royce matters.  For more on the mechanics of the Bribery Act, see “Finding Clarity in the New U.K. Bribery Act,” The FCPA Report, Vol. 1, No. 12 (Nov. 14, 2012).

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  • From Vol. 1 No.12 (Nov. 14, 2012)

    Alan Kartashkin and Dmitri Nikiforov of Debevoise & Plimpton LLP Discuss the Ins and Outs of Russian Bribery Law

    Russia and Ukraine are rich in business opportunities but rife with business challenges, especially for foreign companies operating there or considering entering those markets.  Both countries recently passed anti-bribery laws, thereby adding new layers of complexity to the global patchwork of domestic anti-bribery regimes.  In an effort to understand how the new Russian and Ukrainian laws are similar to and different from the FCPA and the U.K Bribery Act, and what companies and compliance professionals should do to navigate the new laws, The FCPA Report recently interviewed two prominent partners in Debevoise & Plimpton LLP’s Moscow office, Alan Kartashkin and Dmitri Nikiforov.  Specific topics covered in our interview included, among other things, the key differences between the FCPA, the U.K. Bribery Act and the new Russian and Ukrainian laws; how Russia or Ukraine can obtain jurisdiction over an American company; how Russian and Ukrainian enforcement agencies operate; key steps companies should take when entering the Russian and Ukrainian markets; data privacy laws in Russia and Ukraine; the implications of the Novo Nordisk case; and the future of Russian anti-corruption enforcement under the leadership of Vladimir Putin.

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  • From Vol. 1 No.12 (Nov. 14, 2012)

    Finding Clarity in the New U.K. Bribery Act

    The U.K.’s Ministry of Justice has added another tool to its arsenal – like the U.S., it intends to use Deferred Prosecution Agreements (DPAs) for cases of economic crime, following a recent consultation and the overhaul of U.K. Bribery laws in July of last year.  That overhaul replaced elderly bribery laws regarded as ineffective to prosecute modern cases.  The new Bribery Act 2011 (Act) provides a consolidated scheme of offences and, unlike the FCPA, applies to bribery in both the public and private sectors.  Law enforcement agencies in the U.K. had two main mechanisms to deal with bribery and other economic crime by companies: criminal prosecution (followed by confiscation of illicit assets), or civil recovery under legislation which enables prosecutors to make a claim against a company to recover the proceeds of criminal conduct.  DPAs will offer a third option.  In a guest article, James Maton, a partner in Edwards Wildman Palmer UK LLP’s London office, provides details about the provisions of the Act and guidance issued by the U.K., and the government’s new policy on DPAs.  A forthcoming article in The FCPA Report will address specific actions companies can take in light of this new enforcement landscape in the U.K.

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  • From Vol. 1 No.12 (Nov. 14, 2012)

    Deloitte Survey Catalogues Bribery Risks in Emerging Markets and Outlines Compliance Recommendations

    On October 29, 2012, Deloitte Financial Advisory Services LLP released its fifth annual survey on business executives’ approaches on compliance and integrity-related risks in emerging markets.  This article summarizes Deloitte’s findings, including recommendations for effective compliance and integrity-related risk management for companies operating in emerging markets.

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  • From Vol. 1 No.11 (Nov. 7, 2012)

    Kroll Survey Identifies Global Fraud Trends and Risks in Europe, the Middle East and Africa

    Kroll Advisory Solutions (Kroll) recently released its sixth annual “Global Fraud Report,” analyzing the results of an in-depth survey on fraud and corruption worldwide conducted in July and August 2012.  To complete its research, Kroll’s Economist Intelligence Unit polled more than 830 senior executives in a broad range of industries, with over half the participants holding C-level positions at companies with annual revenues exceeding $500 million.  This article discusses Kroll’s key survey findings and recommendations then details Kroll’s regional analyses for Europe, the Middle East and Africa.

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  • From Vol. 1 No.10 (Oct. 17, 2012)

    Britain’s Serious Fraud Office Updates Guidance on the Bribery Act, Reinforcing Its Role as a Crime Fighting Agency

    While much of the U.S. anti-corruption community was focused on the expected arrival of FCPA guidance from the DOJ and the SEC, on October 9, 2012, the Serious Fraud Office (SFO), the U.K.’s agency with primary responsibility for enforcing the Bribery Act, beat them to the punch, releasing new guidelines relating to certain aspects of the Act in a tone that emphasizes the importance the SFO is placing on targeting bribery.  This article details the substance of the guidance and its implications for operating companies.

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  • From Vol. 1 No.9 (Oct. 3, 2012)

    Why the Current Regime Is Effective at “Busting Bribery": An Interview with Professor Dan Danielsen, Co-Author of the Open Society Foundations’ Report on Corruption

    The FCPA Report recently had a wide-ranging conversation with Dan Danielsen, a Professor at Northeastern University School of Law and former general counsel of Europe Online Networks, S.A. and partner at Foley Hoag LLP.  Professor Danielsen, along with David Kennedy, Professor at Harvard Law School and Director of the Institute for Global Law and Policy, authored the report “Busting Bribery: Sustaining the Momentum of the Foreign Corrupt Practices Act” (Report).  The Report was commissioned by the Open Society Foundations as a response to the Chamber of Commerce’s report, which argued for amendments to the FCPA.  Danielsen and Kennedy had complete academic freedom as to the content and conclusions drawn in the Report.  In our interview, Professor Danielsen discussed, among other things: why the costs of bribery, given the evolving global scheme, outweigh the benefits; the effectiveness of the DOJ Opinion Procedure; why a good faith compliance defense is inconsistent with the scienter requirement in the statute; how agreements with the government, such as DPAs and NPAs, are creating a regulatory jurisprudence similar to no-action letters in the securities context; companies’ reluctance to go to court and obtain judicial scrutiny; the reasonableness of the current “knowing” standard in the statute; and the need for flexibility in the definition of “foreign official.”

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  • From Vol. 1 No.9 (Oct. 3, 2012)

    Anti-Corruption Compliance in the Age of Global Enforcement

    A global wave of anti-corruption regulation has been steadily gaining momentum since it began in the 1990s.  International organizations, such as the Organisation for Economic Co-operation and Development, have set their sights on fighting bribery and have successfully pressured member states to pass tighter laws.  Cross-border enforcement cooperation is also on the rise.  This heightened scrutiny has highlighted the importance for corporations to have globally effective anti-corruption compliance programs.  Successful programs help reduce the risk of violations and may also engender a more favorable regulatory response when issues arise.  In a guest article, Richard Sibery, the Leader for Fraud and Investigations with Ernst & Young LLP’s Fraud Investigation & Dispute Services (FIDS) practice, and Virginia Adams, a Senior Manager in E&Y’s FIDS practice, discuss the three basic building blocks of a best-of-breed compliance program.  For additional insight from Sibery, see “Training, Certification, Due Diligence, Customs Clearance and Facilitation Payments: An Interview with Leaders of Ernst & Young’s Fraud Investigation & Dispute Services Practice,” The FCPA Report, Vol. 1, No. 1 (Jun. 6, 2012); and “Anti-Corruption Audits, Risk Assessments, Transaction Testing and the Dangers of Petty Cash: An Interview with Leaders of Ernst & Young’s Fraud Investigation & Dispute Services Practice,” The FCPA Report, Vol. 1, No. 2 (Jun. 20, 2012).

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  • From Vol. 1 No.8 (Sep. 19, 2012)

    Grant Thornton Webinar Highlights FCPA and U.K. Bribery Act Compliance Trends (Part Two of Two)

    On August 21, 2012, Grant Thornton hosted a webinar entitled “Evolving Anti-Corruption Legislation: Is your business up-to-date?”  The program provided a helpful overview of trends in FCPA enforcement and enforcement of the U.K.’s Bribery Act of 2010 (Bribery Act), including the potentially broad reach of the Bribery Act, and guidance on best practices for anti-corruption compliance.  The FCPA Report is covering the webinar in a two-part article series.  This article, the second part, focuses on compliance trends.  The first part focused on enforcement trends.  See “Grant Thornton Webinar Highlights FCPA and U.K. Bribery Act Enforcement Trends (Part One of Two),” The FCPA Report, Vol. 1, No. 7 (Sep. 5, 2012).

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  • From Vol. 1 No.7 (Sep. 5, 2012)

    Grant Thornton Webinar Highlights FCPA and U.K. Bribery Act Enforcement Trends (Part One of Two)

    On August 21, 2012, Grant Thornton hosted a webinar entitled “Evolving Anti-Corruption Legislation: Is your business up-to-date?”  The program provided a helpful overview of trends in FCPA enforcement and enforcement of the U.K.’s Bribery Act of 2010 (Bribery Act), including the potentially broad reach of the Bribery Act, and guidance on best practices for anti-corruption compliance.  The FCPA Report is covering the webinar in a two-part article series.  This article, the first part, focuses on enforcement trends, and the second part will focus on compliance.  The participants in the panel were Sterl Greenhalgh and Bill Olsen of international accounting and auditing firm Grant Thornton UK and Grant Thornton US LLP, respectively, and Vivian Robinson of law firm McGuire Woods UK.  Greenhalgh is Grant Thornton UK’s head of anti-bribery and corruption.  Olsen, Grant Thornton’s U.S. leader of Anti-Corruption services and Global Investigations, authored “The Anti-Corruption Handbook.”  Robinson was previously General Counsel to the U.K.’s Serious Fraud Office, which has primary responsibility for enforcing the Bribery Act.  Robinson led the development of the SFO’s enforcement policy under the Bribery Act.

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  • From Vol. 1 No.5 (Aug. 8, 2012)

    Designing a Facilitation Payments Policy to Minimize Liability and Retain Flexibility (Part Two of Two)

    Facilitation payments – payments to foreign officials that facilitate or expedite routine tasks – remain “legal bribes” under the FCPA.  Facilitation payments can be advantageous in many circumstances, and sometimes even essential to the safety of a company’s workers or the viability of its ongoing operations.  But such payments are prohibited under other foreign bribery laws, and they are nearly universally prohibited as payments to domestic officials under local laws.  Companies have struggled to strike the right balance between business flexibility and legal compliance.  Many companies have banned facilitation payments outright, but doing so can unduly limit a company’s ability to act quickly and decisively, which can be crippling in competitive markets.  On the other hand, too lax an approach to facilitation payments invites enforcement actions and reputational harm.  To assist our subscribers in designing policies, procedures and practices that balance compliance considerations with the need to retain business agility, we are publishing this second article in a two-part series.  This article addresses: advisable “safety valves” or exceptions to a general ban on facilitation payments; drafting and implementing a facilitation payments policy to accommodate those exceptions and avoid liability; concerns relating to the all-important issue of properly recording facilitation payments; and seven specific steps that companies should take in designing training programs relating to facilitation payments.  The first article in this series discussed: the definition of a facilitation payment, including examples; the differing treatment of such payments under the FCPA and other laws, notably the U.K. Bribery Act; the tension that has resulted from the conflict of laws; cases in which the argument has been made that the payments in question were facilitation payments, including the Wal-Mart investigation; and the trend among companies toward banning facilitation payments outright.  See “Designing a Facilitation Payments Policy to Minimize Liability and Retain Flexibility (Part One of Two),” The FCPA Report, Vol. 1, No. 4 (Jul. 25, 2012).

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  • From Vol. 1 No.5 (Aug. 8, 2012)

    FCPA Investigation Protection: D&O Insurance and Beyond

    Few subjects receive as much attention in legal, compliance and accounting circles these days as the FCPA, the United Kingdom Bribery Act and other foreign and international anti-corruption laws.  However, while legal issues, compliance questions and legislative initiatives are the subject of constant scrutiny from companies, legal counsel, blogs, commentators and lobbyists, one potential means of ameliorating FCPA risk receives relatively little consideration: insurance.  So, what can a company do in the insurance context to protect itself against the costs of an FCPA investigation and/or proceeding?  In a guest article, M. Machua Millett, a Senior Vice President at international insurance brokerage firm Marsh USA, Inc., addresses this important question.

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  • From Vol. 1 No.5 (Aug. 8, 2012)

    Anticipating and Addressing FCPA Concerns When Expanding Internationally: An Interview with Dr. Shan Nair, Founder of Nair & Co.

    The FCPA Report recently spoke with Dr. Shan Nair, the founder of Nair & Co., a firm that specializes in helping companies navigate international expansion issues, including implementing anti-corruption and compliance measures.  Dr. Nair’s firm has helped approximately 1,000 companies expand into 50 countries.  In a wide-ranging conversation with The FCPA Report, Dr. Nair shared his insight on, among other things, anti-corruption considerations when buying a company and the benefits of buying the assets and not the stock; whether a company can be liable for a third party’s actions; the proper focus of anti-corruption audits; the anti-competitive nature of the FCPA and the U.K. Bribery Act; and the global anti-corruption landscape, in particular, implications for companies doing business in India and China.

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  • From Vol. 1 No.4 (Jul. 25, 2012)

    Designing a Facilitation Payments Policy to Minimize Liability and Retain Flexibility (Part One of Two)

    The FCPA prohibits bribes to foreign officials, but the statute carves out an exception for bribes that facilitate or expedite a foreign official’s routine tasks.  The U.S. stands nearly alone on the global stage with this exception, yet no changes to the law are in view.  In 2010, Chuck Duross, Assistant Chief in the DOJ Criminal Division’s Fraud Section, said, “We’re not saying you should make facilitating payments, it’s an exception, we’re not encouraging it.”  The tide, strengthened after passage of the U.K. Bribery Act, has been turning against facilitation payments, and more and more companies have begun to rethink allowing any kind of “grease” payment at all.  Compounding the trend are the high-profile troubles of Wal-Mart, in which one prominent issue is whether certain payments constitute bribes or facilitation payments under the FCPA.  The reasons to ban facilitation payments outright are plenty, a significant one being the conflict of laws: Not only do most countries ban these kinds of payments to foreign officials, but most local laws ban these kinds of payments to domestic officials, subjecting the company that makes such a payment to potential prosecution abroad even if the payment is legal under U.S. law.  Further complicating the picture is the need to properly record the facilitation payments or risk an FCPA books and records violation.  Moreover, there is the challenge of employees on the ground determining whether an official receiving a grease payment is using “discretion” or not – that is, determining whether the same dollars are a bribe or a facilitation payment.  Prohibiting facilitation payments completely, however, may not be feasible.  Sometimes the safety of a company’s workers depends on such a payment; sometimes foregoing the payment will shut down the entire business; and sometimes the payment truly is a small payment to expedite a routine government service.  Designing and implementing a policy that protects a company from liability yet is flexible enough to accommodate extenuating circumstances is a difficult task.  This two-part article series takes on that task and sheds light on the nuances of this issue, providing insight from leading practitioners on how to formulate a workable compliance policy on facilitation payments.  Part one of this series discusses: the definition of a facilitation payment, including examples; the differing treatment of such payments under the FCPA and other laws, notably the U.K. Bribery Act; the tension that has resulted from the conflict of laws; cases in which the argument has been made that the payments in question were facilitation payments, including the Wal-Mart investigation; and the trend among companies towards banning facilitation payments outright.  Part two of the series will address: advisable “safety valves” or exceptions to a general ban on facilitation payments; drafting and implementing a facilitation payment policy to accommodate those exceptions and avoid liability; concerns relating to the all-important issue of properly recording facilitation payments; and guidance on training employees about facilitation payments.

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  • From Vol. 1 No.4 (Jul. 25, 2012)

    International Corruption Risks Facing Financial Institutions

    For many years, financial institutions had not been frequent targets of FCPA enforcement.  However, the past two years have revealed that regulators have not forgotten about this industry.  The financial crisis increased regulatory scrutiny both from an investigative and a legislative perspective.  The SEC and DOJ are investigating financial institutions for violations of securities laws, the FCPA, anti-money laundering rules, and similar regulations.  As discussed in this article, and as the various reviews by regulators reveal, banks, private equity firms, and other financial institutions face several avenues of potential liability due to the nature of their overseas business under a myriad of domestic and international statutes.  To properly navigate this complex regulatory framework requires an effective and regularly updated compliance program, consistent with the recommended government standards (and perhaps building off of their current anti-money laundering procedures), and any responses to regulatory requests demand a carefully structured internal review.  In a guest article, Palmina Fava and Alan Brudner, both partners at Paul Hastings LLP, and Mor Wetzler, an associate at Paul Hastings, discuss: the regulatory focus on financial firms; guidance for anti-corruption compliance derived from anti-money laundering initiatives; the potential for anti-corruption liability without actual knowledge of the relevant corruption; the strict liability provisions of the U.K. Bribery Act; common sources of liability for financial institutions; specific compliance considerations raised by dealings with sovereign wealth funds and state-owned enterprises; and the risk of required offset funds.

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  • From Vol. 1 No.2 (Jun. 20, 2012)

    Kroll Benchmarking Report Surveys State of FCPA Compliance at U.S. Multinationals

    Risk management firm Kroll Advisory Solutions (Kroll), a division of Altegrity, recently released its 2012 FCPA Benchmarking Report, including and analyzing the results of its annual survey of FCPA preparedness.  The survey report is “an in-depth study designed to take the pulse of corporate compliance officers at U.S.-based multinationals and to provide benchmarks for the current state of anti-bribery preparedness,” according to Kroll.  This article conveys the key points from the benchmarking report and offers critical insights for companies looking to measure their FCPA compliance programs against best practices.

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