Matt Kelly and I did an episode on our podcast, Compliance into the Weeds, about the KT Corporation settlement Foreign Corrupt Practices Act (FCPA) with the Securities and Exchange Commission (SEC) via a Cease and Desist Order (the Order) for “disgorgement of $2,263,821, prejudgment interest of $536,457, and a civil money penalty in the amount of $3,500,000” bringing the total fine and penalty to just over $6.3 million. One of the most prescient lines that came out of the podcast was that you need a flow chart to follow all the bribery schemes and you needed a scorecard to follow all the persons and entities involved in those schemes. In today’s post we will look at the bribery schemes in some detail.
I. South Korea
a. Getting Cash
As I mentioned yesterday, the bribery schemes used by KT Corp. harkened back to some older FCPA enforcement actions in one respect as one of the key bribery schemes used involved cash. The cash was garnered to fund a series of bribes from 2009-2017. The Order noted, “high-level executives of KT maintained slush funds, comprised of both off-the-books accounts and physical stashes of cash, in order to provide items of value to government officials, among others. These included gifts, entertainment and, ultimately, illegal political contributions to members of the Korean National Assembly serving on committees relevant to KT’s business.”
The cash was obtained in two distinct ways. In the first scheme, 2009-2013, the Chief Executive Officer (CEO) and another senior approved inflated bonuses to other executive officers and executives. The recipients laundered the bonus payments into cash and next returned the cash to the CEO. This generated a slush fund of approximately $1 million. Some of the funds were held in another executive’s personal bank account, while the cash was stored in a safe in the corporate offices. The CEO then used the cash as a slush fund for gifts and payments to Korean government officials with the ability to influence KT Corp.’s business. There was no accompanying spreadsheet recordation’s of the gift recipients, although these payments were apparently common knowledge within the executive ranks. In a massive accounting fraud, the company “booked the slush fund amounts as executive bonuses, even though the money was used for gifts and for payments to government officials.”
Eventually this bribery scheme was uncovered, and the CEO was criminally charged on this matter. This did not deter KT Corp. in moving forward to continue to engage in bribery and corruption. From 2014 to 2017, the company’s Corporate Relations (“CR”) Group was brought in as the funding mechanism to create the pot of money to pay bribes. However, this vendor did not deliver gift cards to the CR Group but cash. The corrupt vendor even kept a percentage of the overall amount of cash as a fee. To facilitate the accounting fraud, the company used the phrase “CR Case Benchmarking,” in the company purchasing system as the purported purpose for the purchase.
But the cloak and dagger style used by KT Corp. continued as the vendor would meet a representative from the CR Group outside the KT office building where the vendor would give the CR Group representative “a paper bag containing a large manila envelope of cash, corresponding to the value of the gift cards purchased, less a commission for Vendor.” The cash was kept locked in the CR Group offices.
Unlike the first bribery scheme which was run directly by the CEO, in this second phase the cash was provided “to KT officers and managers, with the understanding that they would transfer the funds electronically to the contributions accounts for various Korean lawmakers. Once the transfer was made, a CR employee would inform the particular lawmaker’s aide that the contribution came from KT. This scheme was used to evade Korea’s Political Funds Act, which prohibits corporations from making political contributions. Most of the funds went to lawmakers in the National Assembly who sat on committees with the ability to impact the telecommunications industry and KT’s business.”
b. Hiring of Princelings
Here we saw a variety of the Princelings scandal that engulfed JPMorgan and other entities in bogus hiring’s of sons, daughters and other family members to provide illegal benefits to foreign government officials. Yet another scheme involved hiring individuals, as KT Corp. employees, with personal connections to the South Korean White House and ruling party, (the “Blue House”). Once they were hired these individuals were given even more cushy jobs in the company. In a derivation of the Princelings hiring schemes, the company also hired an entire advertising agency which did not meet KT Corp. criteria for retention as a vendor. In addition to hiring this unqualified advertising agency, “KT paid the two individuals a total of $454,009 in salaries and the advertising firm a total of $5.88 million in fees.”
II. Vietnam
a. Solar Power Project
In this project, KT Corp. used a sophisticated business venture, which was not a formal partnership or Joint Venture (JV) partnership. Under this bribery scheme, KT Corp. had another company involved in the project wire some $95,000 to KT Corp, who then would facilitate the payment of the bribe. The money was wired to a KT Corp. employee’s personal bank account, who then withdrew as cash. The employee and a construction company subcontractor representative met the corrupt government official and he was paid the money. Internally, the payment was described as “a rebate to the project owner.”
However, that did not end the matter for KT Corp. as they had to repay the construction company for the $95K. The construction company billed KT Corp. for the bribe, describing it as “expenses for engaging in sales activities with the ordering organization . . . ($95K),” as well as other expenses. KT Corp. paid the construction company approximately $200,000 to settle all the claims, including reimbursement for the bribe payment, and it booked the payment as “Support/consulting for performance of the business (completed).”
b. Vocational College Project
KT Corp. participated with a consortium to bid on the Vocational Colleges Project. KT Corp. learned from its original consortium partner (“Partner 1”), which was to pay the agent fee, that 10% of the project cost would go to the agent, who would pass on 7% of the project cost to Official 1. However, Partner 1 informed KT Corp. that it did not want to be responsible for the agent’s fee due to the risk involved. KT Corp. agreed to reorganize the consortium and assume responsibility for paying the agent’s fee. KT Corp. and a corrupt agent agreed that the fee would be 8.5%, which included $550,000 for Official 1.
KT Corp. then arranged for a subcontractor in the consortium to become a consortium partner (“Partner 2”) and KT Corp. “tasked Partner 2 with the responsibility of paying the agent fee. The purpose of the arrangement was to distance KT from the agent, as well as to conceal the agent from KT’s agent review process. While the agent review process was a financial risk review, not an anticorruption review, the KT managers involved preferred to avoid any questions about KT’s relationship with the agent. Paying the agent through Partner 2 enabled KT managers to bypass the review.”
As I said at the start of this post, you need a flow chart to follow the bribery schemes and a scorecard to follow the players.
Join us tomorrow where we look at some lessons learned for the compliance professional.
Tag: FCPA
As the villain Le Chiffre says to James Bond just before he began to torture him in the movie version of Casino Royal, “Sometimes the old ways are the best.” He then begins to beat Bond’s family jewels with a knotted hemp rope. It is one very painful scene to watch.
I thought of the movie line, but not the torture scene, when I read the most recent Foreign Corrupt Practices Act (FCPA) enforcement action where the Korean entity KT Corporation settled with the Securities and Exchange Commission (SEC) via a Cease and Desist Order (the Order) for “disgorgement of $2,263,821, prejudgment interest of $536,457, and a civil money penalty in the amount of $3,500,000” bringing the total fine and penalty to just over $6.3 million. The reason for the prescience of the Le Chiffre line was that the first bribery schemes in South Korea largely revolved around cash. We have not seen those ‘little brown bags’ of cash in too many recent FCPA enforcement actions. This makes the KT Corp. matter worth looking at in some detail.
In terms of financial penalties, the total amount is obviously low. However, there are multiple lessons to be garnered from the enforcement action that are worth exploring. Over the next few blog posts, I will be taking a deep dive into the enforcement action and exploring it in some detail.
Background
First a word on jurisdiction as you may be asking why is the US SEC bringing a FCPA enforcement action against Korea’s largest telecoms operator? For KT Corp., the answer is that it has American Depositary Shares, (ADRs) which are registered with the SEC and trade on the New York Stock Exchange (NYSE). Additionally, KT Corp. files periodic reports, including Form 20-F, with the SEC. If you represent companies which have ADRs in the US, you might want to inquire if they have any internal controls around the FCPA and whether they even have a compliance program.
According to the SEC Press Release announcing the resolution, KT Corp. is “South Korea’s largest telecommunications operator, engaged in multiple schemes to make improper payments in Korea and Vietnam.” However, the company did not have “sufficient internal accounting controls over charitable donations, third-party payments, executive bonuses, and gift card purchases.” This failure of internal controls leads to numerous compliance failures and FCPA violations where “high-level executives, were able to generate slush funds that were used for gifts and illegal political contributions to government officials in Korea who had influence over KT Corp.’s business. Other employees were able to make payments in connection with seeking business from government customers in Vietnam.”
Moreover, as specified in the Order, “the misconduct involved former high-level managers and executives and occurred under circumstances whereby KT had no relevant anti-corruption policies or procedures with respect to donations, employment candidates, vendors, subcontractors, or third-party agents. In certain instances, this allowed KT employees to provide benefits improperly to government officials and to seek business from government customers. As a result of this misconduct, KT violated the books and records and internal accounting controls provisions of the FCPA.”
Charles Cain, Chief of the SEC Enforcement Division’s FCPA Unit, was quoted in the SEC Press Release for the following, “For nearly a decade, KT Corp. failed to implement sufficient internal accounting controls with respect to key aspects of its business operations, while at the same time lacking relevant anti-corruption policies or procedures. Issuers must be sure to devote appropriate attention to meeting their obligations under the FCPA.” Finally, “in November 2021, South Korean authorities indicted KT Corp. and 14 executives for criminal violations related to illegal political contributions from the slush funds.”
Culture
There were multiple bribery schemes involving KT Corp., which we will detail at some length in this series. However, one thing that is made clear in this Order is the complete and total failure of a culture of compliance at KT Corp. or at least something coming close to an appearance of doing business by not paying bribes. First was the length of the bribery schemes detailed in the Order, which stated, “From at least 2009 through 2017, high-level executives of KT maintained slush funds, comprised of both off-the-books accounts and physical stashes of cash, in order to provide items of value to government officials, among others. These included gifts, entertainment and, ultimately, illegal political contributions to members of the Korean National Assembly serving on committees relevant to KT’s business.”
When this slush fund story was broken open by the Press in South Korea, the company did not take the opportunity to self-disclose, remediate the deficiencies discovered or even stop the bribery and corruption. Instead, KT Corp. officials “devised a new method to continue generating a slush fund.” Clearly this was a business that was committed to feathering its nest via bribery and corruption.
Join us tomorrow where we take a deep dive into the bribery schemes.
In this episode of the FCPA Compliance Report, I am joined by fan favorite James Koukios, partner at Morrison and Foerster. In this episode we consider some of the key ABC issues in the always great MoFo Monthly Top 10 International Anti-Corruption Developments for November 2021. Highlights of this podcast include:
- OECD Updates Recommendation for Combatting Foreign Bribery
- Federal District Court Dismisses FCPA and Money Laundering Charges Against Swiss Wealth Manager
- SEC Reports Surge in Whistleblower Tips and Awards
- Former Coal Executive Pleads Guilty to Egyptian Bribery Scheme
- Adoption Agency Manager Pleads Guilty to Uganda Bribery Scheme
Resources
James Koukios on the MoFo website
November International Anti-Corruption Newsletter here
Super Sunday is here. The NFL finally gets the game in the spotlight after weeks of brutal PR. Who ya got? “Who Dey” or Hollywood? Tom and Jay are back look at some of the week’s top compliance and ethics stories this week in the Super Sunday edition.
Stories
1. Do compliance professionals need a union? Dick Cassin in the FCPA Blog.
2. Jailed employees under the FCPA. Bill Jacobsen explores in the FCPA Blog.
3. New workplace normal for policies and training. Ingrid Freeden in Risk and Compliance Matters.
4. New SOE risk management framework. Alexandra Gillies and Thomas Shipley in the FCPA Blog.
5. 3 questions from KPMG and Carillion tribunal. Neil Hodge in Compliance Week. (sub req’d)
6. SFO investigation protocol announced. Mengqi Sun in the WSJ Risk and Compliance Journal.
7. Companies yet again ask EU for rules around ESG. Lawrence Heim in practicalESG.
8. CCOs say self-reporting a hard sell. Evren Esen in CCI.
9. What comes next for ABC and the Olympics? Andy Spalding in GAB.
10. The Spotify imbroglio. Matt Kelly with a 2-parter in Radical Compliance, Part 1 and Part 2.
Podcasts and More
11. In February on The Compliance Life, I visit with Ellen Smith, a former Director of Trade Compliance who recently started her own consulting firm. In Part 1, she discussed her academic background and early professional career. InPart 2, Ellen moves in-house.
12. Tom and Richard Lummis begin their annual review of Best Picturing winning movies on 12 O’Clock High, a podcast on business leadership. In Part 1 they review Schindler’s List for leadership and ethical lessons. Upcoming episodes will look at Gladiator, A Man for All Seasons and Platoon.
13. CCI releases new e-book from Tom “FCPA 2021 Year in Review”. Available free from CCI.
14. Trial of the Century-the Enron Trial. This week, Tom premiered a 5-part podcast series on the Enron Trial with Loren Steffy, who covered the trial for the Houston Chronicle. In Part 1, run up to the trial. In Part 2, the trial begins. In Part 3, the star witnesses and key testimony. In Part 4, the Verdict comes in. In Part 5, what did it all mean. It is be available on the Compliance Podcast Network, Megaphone, iTunes, Spotify and all other top podcast platforms.
15. In a special 2-part series on the Sunday Book Review, Tom looks at the Notre Dame Deloitte Center for Ethical Leadership’s top books on ethical leadership from 2021. Part 1 and Part 2.
Tom Fox is the Voice of Compliance and can be reached at tfox@tfoxlaw.com. Jay Rosen is Mr. Monitor and can be reached at jrosen@affiliatedmonitors.com.
Last week I wrote about the first Opinion Release for 2022, appropriately named Opinion Release 22-01. Several persons emailed me about my analysis and discussion, concluding with the point that there was no need for an Opinion Release on this issue. Jon May made that same argument publicly. Their collective thoughts were that this was a straight extortion claim made against the shipping company (Relator in 22-01) and as both the liberty and health of the ship captain were in immediate danger, there was no need to obtain an Opinion Release from the Department of Justice (DOJ) as this matter fell precisely within extortion and therefore outside the Foreign Corrupt Practices Act (FCPA).
I agree with all those who contacted me or put such an opinion in print. The shipping company could have made the payment without the DOJ Opinion Release and in my opinion not run afoul of the FCPA. There is certainly nothing wrong in being cautious and obtaining an Opinion Release on this issue, particularly given the expediency of the DOJ response to the company which sought the Opinion Release, which was literally given in the time span of a few days. However, such a need for cautiousness is not mandated under the FCPA.
If your company or client is facing a situation where its employees are being held and no charges are forthcoming, their liberty is at risk, if your employees are threatened at gun point or in some other manner where the physical safety is at risk, or if your employee’s health is put at risk, and money is demanded to relieve any of these situations; then the FCPA does not apply and your organization or the employees themselves can make the payment and not face FCPA risk.
It is incumbent to remember extortion payments are not illegal under the FCPA. Extortion payments are made for any action which threatens or demands payment for life, liberty, or health. These should be exempted out from your facilitation payments and your compliance program through specific language. You need to do this for a variety of reasons. First and foremost, your employees must understand that the company will support them if they are in any way threatened with harm, arrest or physical detention and/or their health/safety is threatened. As a compliance professional, you need to make sure they understand they need to do whatever they have to do to get themselves out of such a situation.
Some of the situations your employees might face are along the lines of the following:
- Employees are stopped by police, military or paramilitary personnel, or militia (uniformed or not) at designated or other checkpoints or other places and a payment is demanded as a condition of passage of persons or property.
- Employees are stopped at the airport by customs or passport control personnel or military personnel and a payment is demanded for entry or exit of persons or property.
- Employees are asked by persons claiming to be security personnel, immigration control, or health inspectors to pay for an allegedly required inoculation or other similar procedure.
I once had a situation in which an employee was threatened with receiving a vaccination for yellow fever when he was departing a west African country. The employee paid some $85 to get out of that situation. I instructed him to submit it as a travel expense, writing out in a four-sentence paragraph, attached to his expense report. The documentation proved that payment was not a facilitation payment. It was clearly an extortion payment.
In Opinion Release 22-01, the ship captain of the Relator in question was detained by the un-named Country A with no written documentation of the charges. Moreover, according to the Opinion Release 22-01, “Requestor has provided information and documentation showing that the captain was at that time suffering from serious medical conditions that would be significantly exacerbated by the circumstances and conditions of his detention and created a significant risk to his life and well-being.”
If your employees pull up to a roadblock and government authorities pull guns, there is a clear threat of physical safety for those employees. They should pay whatever amount they can to extricate themselves from the situation as quickly as possible.
The key though in each of these situations is that it be properly documented, even if under the first and third scenario above, such documentation could be a handwritten statement by your employees who were a part of the extortion attempt. But more than simply the documentation is that you must specifically list extortion payments in your books and records, so you will not be suspected with hiding them by describing them as something else. It is crucial to train your employees specifically on the actions to take. In your policy, you should clearly state that if there is a threat to health, safety or liberty, it is not a facilitation payment but an extortion payment. Make sure that they understand what their rights are and what their obligations are to report it when they return to their office. Always remember, an extortion payment is not a FCPA violation.
In Opinion Release 22-01, the DOJ stated, “The facts presented by Requestor demonstrate that the proposed payment would not be made with corrupt intent. Based on the information from Requestor, the primary reason for the payment was to avoid imminent and potentially serious harm to the captain and the crew of the Requestor vessel. Under the FCPA, “[a] person acts corruptly if he acts voluntarily and intentionally, with an improper motive of accomplishing either an unlawful result or a lawful result by some unlawful method or means. The term ‘corruptly’ is intended to connote that the offer, payment, and promise was intended to influence an official to misuse his official position.”” This is a correct statement of the FCPA. But it is also a correct statement to say that extortion payments are not made illegal under the FCPA.
As the GOAT of pro football, Tom Brady retires, Brian Flores sues the NFL and the Bengals/Rams make the Super Bowl, Tom and Jay are back look at some of the week’s top compliance and ethics stories this week in the Brady Retires edition.
Stories
- DOJ issues first Opinion Release of 2022. DOJ website. Tom in FCPA Compliance and Ethics Blog. Bill Steinman in the FCPA Blog.
- Do BODs have unrealistic expectations on compliance? Dick Cassin explores in the FCPA Blog.
- KPMG mislead FRC through forged docs. Risk and Compliance Platform Europe.
- LRN releases 2022 Program Effectiveness Report. Download report here. Matt Kelly in Radical Compliance.
- A ‘how-to’ on remediating. The HeadSpin enforcement action. Tom in FCPA Compliance and Ethics Blog. Aaron Nicodemus in Compliance Week. (sub req’d)
- Learning to scale up ethically. Hemant Taneja in CCI.
- Why compliance should lead ESG. Carrie Penman in Ethics and Compliance Matters.
- The Boardroom agenda in 2022. Deloitte in Harvard Law School forum on Corporate Governance.
- Changes in antitrust enforcement and its impact on compliance. Mike Volkov, Matt Kelly and Tom in Compliance into the Weeds. Mike Volkov with a 3-part blog series in Corruption Crime and Compliance.
- Unclear values can lead to unethical behavior. Brett Beasley in Center for Ethical Leadership.
Podcasts and More
- In February on The Compliance Life, I visit with Ellen Smith, a former Director of Trade Compliance who recently started her own consulting firm. In Part 1, she discussed her academic background and early professional career.
- Aly McDevitt with a multipart series in Compliance Week on the end-to-end story of a ransomware attack. Here more about the series on this month’s edition of From the Editor’s Desk, with Tom and Dave Lefort. A subscription is required but Compliance Week is running a membership special of $199 for the year. Use Promo Code RNSM199. For information and details click here.
- CCI releases new e-book from Tom “FCPA 2021 Year in Review”. Available free from CCI.
- Trial of the Century-the Enron Trial. This week, Tom premiered a 5-part podcast series on the Enron Trial with Loren Steffy, who covered the trial for the Houston Chronicle. In Part 1, run up to the trial. In Part 2, the trial begins. In Part 3, the star witnesses and key testimony. In Part 4, the Verdict comes in. In Part 5, what did it all mean. It is be available on the Compliance Podcast Network, Megaphone, iTunes, Spotify and all other top podcast platforms.
- Looking for a quick daily bite of trade compliance? Check out the Compliance Kitchen with Silvia Surman, who gives a short 3-5 minute update on one trade compliance topic each day. On the Compliance Podcast Network.
Tom Fox is the Voice of Compliance and can be reached at tfox@tfoxlaw.com. Jay Rosen is Mr. Monitor and can be reached at jrosen@affiliatedmonitors.com.
Categories
Creative Lawyerin’ and Opinion Release 22-01
Yesterday, I ended my blog post with a few words about what we call in Texas Creative Lawyerin in the context of a Securities and Exchange Commission (SEC) enforcement action where there was zero fine and penalty due to the extraordinary remediation engaged in by the recalcitrant company whose Chief Executive Officer (CEO) allegedly engaged in fraudulent and illegal behavior. While the rest of the world calls this ‘Creative Lawyering’; whether you say it with a Texas drawl or not, what it means is that lawyers are at times called upon to find creative ways of working within a legal framework. According to Summize, this means, “The outcome often relies upon a lawyer’s storytelling ability – how they package an argument or a party’s point of view in a suitable and meaningful way. These abilities, in addition to critical thinking, social skills, listening and reasoning, can be particularly useful in commercial law when working with multiple stakeholders.” Another way to say it is one of my most favorite phrases about lawyering which is as a lawyer, “you are only limited by your imagination.”
Background
We saw yet another example of such creativity in the first Opinion Release of 2022, 22-01. The Opinion Release procedure allows companies (Requestor) to submit questions to the Department of Justice (DOJ) to determine if they would see any potential Foreign Corrupt Practices Act (FCPA) violations from the actions the Requestor took or anticipates taking. The facts of the matter are quite unique however the discussion and analysis provide significant guidance for FCPA aficionados and compliance practitioners going forward. Additionally, and yet again, the matter does provide a clear example of how a lawyer can be creative and achieve a superior result for their client.
Requestor was required to anchor its ship to await repairs, refit and unloading in Country B. It was directed to a location to do so. However, the location was in the territorial waters of Country A, which promptly arrested the ship’s captain and held the crew aboard the ship. The captain had a medical condition which required treatment. Country B sent a third-party intermediary (intermediary) to demand a monetary payment in the amount of $175,000 for release of the captain. Requestor brought in its own third-party representative (representative) to negotiate the release of the captain with the intermediary, requesting the “formal basis for the payment — such as an invoice or other documentation setting forth charges or an enumerated fine amount — to ensure that the payment would be made pursuant to a fine or other penalty resulting from a legal or regulatory violation, if any.” The intermediary refused to provide any such documentation.
The Requestor also sought the assistance of Country B, US embassy representatives and “sought the assistance from other agencies within the U.S. government to end the captain’s detention and permit the Requestor vessel and its crew to leave Country A expeditiously. Requestor also requested that those agencies notify relevant Country A authorities of the detention of the captain and crew, and the confiscation of the Requestor vessel.” All such avenues were unsuccessful to obtain the release of the captain.
Analysis
The DOJ analysis reminded us all that the FCPA does not prevent payment of all bribes. A predicate for FCPA liability is that the bribe must be made with corrupt intent and used to ‘obtain or retain business.’ The DOJ found neither requirement was present under this fact pattern. First, “the primary reason for the payment was to avoid imminent and potentially serious harm to the captain and the crew of the Requestor vessel.” In fact, the payment was made under duress, and that “an individual who is forced to make payment on threat of injury or death would not be liable under the FCPA.”
Significantly, the payment was not made with an eye towards ‘obtaining or retaining business.’ Requestor was trying to do business in Country B and not Country A and inadvertently strayed into the territorial waters of Country A. The Opinion Release stated, “Requestor has no ongoing or anticipated business with Country A, and the entire episode appears to be the result of an error, emanating from the incorrect advice Requestor received about where to anchor its ship while waiting for the port of Country B to carry out mandatory repairs.” Moreover, the Requestor was transparent in its request for assistance from various US government agencies and representative. The DOJ concluded, “Put simply, under the specific facts presented by Requestor, there does not appear to be a sufficient business purpose associated with the payment — and relatedly, there is a lack of a corrupt intent under the FCPA.”
Discussion
- Corrupt Intent in Obtaining and Retaining Business
First and foremost is the requirement for corrupt intent in the obtaining and retaining of business. As noted, neither was present here. It certainly helped that the Requestor had no commercial business with or in Country A. If not for the delay in getting into port in Country B, the Requestor would never have been in Country A. The Requestor had no “historical, pending, ongoing, anticipated, or sought after business relationships with government actors” in Country A.
2. Extortion Payments Not Prohibited Under the FCPA
Under the FCPA, an “individual who is forced to make payment on threat of injury or death would not be liable under the FCPA. Federal criminal law provides that actions taken under duress do not ordinarily constitute crimes.” Indeed, this was noted in the FCPA Resource Guide, 2nd edition, which was cited in this Opinion Release for the following, “Situations involving extortion or duress will not give rise to FCPA liability because a payment made in response to true extortionate demands under imminent threat of physical harm cannot be said to have been made with corrupt intent or for the purpose of obtaining or retaining business.”
3. Speed of Decision
A separate note must be made and frankly kudos to the DOJ for the speed in which it handled this most unusual request. As stated in the footnotes, the DOJ received the request on October 19 and 20, 2021. Due to the highly unusual and exigent circumstances, including the risk of imminent harm to the health and well-being of the persons involved, the DOJ provided to the Requestor a preliminary response. Additional information was provided which led to this full Opinion Release.
It is this final piece which caps off the importance of Opinion Release 22-01. Every compliance practitioner should understand that this resource is available to them. I have counseled several companies over the years to use this process and they all declined, not wanting to “open the kimono” and disclose the facts to the DOJ for fear it would result in a FCPA enforcement action. Opinion Release 22-01 shows how being creative as a lawyer can lead to a superior result for your client, especially under the FCPA.
In this episode of the FCPA Compliance Report, I am joined by fan favorite Mike DeBernardis, partner at Hughes Hubbard. In this episode we look at compliance and temporal timeline developments from Q4 2021. Highlights of this podcast include:
- A deep dive into the Lisa Monaco speech, how it impacted the compliance temporal timeline whether it was a change or recalibration.
- Anti-Trust developments.
- The Biden Administration Strategy on Countering Corruption?
- Compliance in 2022 and moving forward.
Resources
Mike DeBernardis on HughesHubbard website.
