The Anti-Corruption Report

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

Recent Issue Headlines

Vol. 2, No. 11 (May 29, 2013) Print IssuePrint This Issue

  • Designing and Implementing Effective Press and Social Media Policies to Mitigate Reputational Harm from Anti-Corruption Investigations

    Press coverage about corruption – or, more likely, alleged corruption – can ignite a string of detrimental events at a company, starting with considerable reputational damage.  When the press, on one of its myriad platforms, picks up a story about corruption, that story can go viral very quickly.  Complicating matters, it is not just the press that can set these events in motion, but anyone with a Twitter account, Facebook page or blog.  Faced with media attention, a company’s options can be suddenly constrained – it may be forced to self-report to the government before it is ready, and must handle all the repercussions of such reporting, all while trying to preserve its relationship and status with its customers, clients and partners.  See “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).  A comprehensive media strategy is crucial.  A recent panel at the American Bar Association’s Fifth Annual National Institute on Internal Corporate Investigations and Forum for In-house Counsel addressed strategies for handling the press and social media.  Industry experts shared their considerable experience handling media issues and provided practical, step-by-step advice for handling a public relations crisis.

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  • A Guide to Disclosing Corruption Investigations in SEC Filings (Part Three of Four)

    Many multi-national public companies with robust anti-corruption compliance programs will discover, at some point, evidence of potential fraud that requires an internal investigation.  See “Handling the Challenges of Overseas Anti-Corruption Investigations: Forensic Accountants, Government Expectations, Translators, Upjohn Warnings, Privilege Issues and Recording Interviews,” The FCPA Report, Vol. 2, No. 9 (May 1, 2013).  When a publicly traded company performs such an investigation, it is faced with a series of difficult questions.  Among the most vexing and urgent questions are whether and when the company should disclose the investigation in an SEC filing.  Should the company wait until it completes the investigation?  Should it wait until after it has disclosed to the DOJ and the SEC?  How much evidence of actual corruption is needed to justify the filing?  What information should the disclosure include?  When answering these questions, companies must consider the serious consequences of publicly reporting FCPA concerns.  Companies that publicly disclose such information may face civil lawsuits, stock price volatility, reputational issues, damage to employee morale and productivity, loss of current government contracts and debarment from future contracts.  See “Doing Business with the World Bank: Understanding and Avoiding Debarment,” The FCPA Report, Vol. 2, No. 10 (May 15, 2013).  The FCPA Report is publishing a series of articles addressing best practices for disclosing anti-corruption investigations in SEC filings.  The series provides insight on when a company should disclose and strategies for mitigating the negative impact of a disclosure, including guidance on timing and language to include in the disclosure.  In addition to analysis and insight from practitioners, this series will include a compendium of actual FCPA-related disclosures from recent SEC filings compiled with help from Intelligize’s database and search tools.  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.  This article, the third in the series, provides insight on the most effective language to use in disclosures, and analyzes Wal-Mart’s disclosures at critical decision points in its recent investigation.  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 the 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.  Finally, in the last article in the series, The FCPA Report will publish the referenced compendium of SEC disclosures, categorized by their attributes.

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  • Digging Deep into M&A Anti-Corruption Due Diligence Best Practices: An Interview with William Michael, Partner at Mayer Brown LLP

    Anti-corruption due diligence before, during and after a merger or acquisition is an area of increasing focus for companies.  Members of the FCPA bar report that more and more of their work involves ensuring target companies are free from corruption, and handling the situation if corruption is discovered.  The FCPA Report recently spoke with William Michael, Co-Chair of the White Collar Defense & Compliance group at Mayer Brown LLP in Chicago, about his experience with these issues.  Previously, Michael served for more than 10 years as a federal prosecutor with the Department of Justice.  Among other things, Michael discussed important questions to ask during a risk assessment; strategies for negotiating for more access to the target company during due diligence; the effect of blocking statutes on due diligence; the risks and benefits of voluntarily disclosing a violation before or after a transaction; whether and how the Resource Guide clarified best practices; and advice on increasing the odds of achieving a declination from the SEC or DOJ if misconduct is discovered post-transaction.  See also “How to Perform Effective FCPA Due Diligence in Private Equity Transactions and Strategic Mergers and Acquisitions,” The FCPA Report, Vol. 2, No. 5 (Mar. 6, 2013).

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  • The Expanding Definition of “Foreign Official” and its FCPA Compliance Implications

    The shrinking global village has made international deals and dealings a daily occurrence.  Yet, a much-debated ambiguity in American law can put at risk any person or company who bestows a benefit on a foreign individual without stopping, first, to consider the definition of “foreign official” under the FCPA.  In a guest article, Ronald E. Wood and Jennifer L. Roche, partner and associate, respectively, at Proskauer Rose LLP, explore why the contours of the FCPA’s anti-bribery provision remain fuzzy 36 years after it was enacted, giving the government a hammer it has wielded with increased frequency over the past decade.  The article also offers guidance on how to avoid having the twin threats of investigation or prosecution make an unwelcome house call.  See also “U.S. Government Counters Foreign Official Challenge in the Eleventh Circuit,” The FCPA Report, Vol. 1, No. 7 (Sep. 5, 2012).

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  • Complying with the FCPA: Mergers, Acquisitions and Investment Transactions (Part Four of Five)

    In light of the significant FCPA risk posed by cross-border transactions, The FCPA Report is serializing (in five parts) a chapter from a recently published treatise, The Foreign Corrupt Practices Act: Compliance, Investigations and Enforcement.  The authors of the treatise are Martin Weinstein, Robert Meyer and Jeffrey Clark, all partners at Willkie, Farr & Gallagher LLP, and highly-regarded FCPA practitioners.  This part of the series addresses corruption risk in non-U.S. investments, including steps to take during pre-investment due diligence, contractual safeguards that will mitigate risk and post-investment responsibilities.  The first part of the series provided an overview of the corruption liability inherent in M&A and investment transactions and provided insight on mitigation of corruption risk before transactions occur, focusing on successor liability, ratification, acts in furtherance of corruption and investment valuation.  The second installment in the series analyzed post-transaction risk, including the concept of willful blindness and the application of the FCPA’s accounting provisions to mergers and acquisitions.  The third installment in the series provided guidance on the due diligence process, including the initial risk assessment, determining the scope of the review, coordinating the work of the review team and investigating red flags.  It also provided advice on steps to take if a compliance issue is discovered and contractual safeguards to include in deal documents to minimize corruption risk.

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  • 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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  • Daniel Suleiman to Join Lanny Breuer at Covington & Burling

    Daniel Suleiman, an attorney who served as Assistant Attorney General Lanny Breuer’s deputy chief of staff and counselor, will return to Covington & Burling LLP in July, a Covington representative confirmed to The FCPA Report.

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  • White Collar Defense Attorney Stephen A. Best Joins Brown Rudnick

    Brown Rudnick LLP recently announced that white collar defense attorney Stephen A. Best has joined the firm’s Washington, D.C. office as a partner in the White Collar Defense and Government Investigations Group.

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