Tag: Hughes Hubbard

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All Things Investigations

All Things Investigations: Episode 22 – Mike Huneke and Laura Perkins on Changes to Corporate Enforcement Policy

Welcome to the Hughes Hubbard Anticorruption and Internal investigation Practice Group’s podcast, where host Tom Fox and Hughes Hubbard Anticorruption and Internal Investigation Practices Group members delve into the legal issues surrounding white-collar and other investigations, both domestically and internationally.  Laura Perkins and Mike Huneke join Tom on this episode to discuss the changes to the Department of Justice’s Corporate Enforcement Policy.

Laura Perkins is the Co-Chair of the Anti-Corruption & Internal Investigations practice group and Co-Managing Partner of the Washington, DC, office at Hughes Hubbard & Reed. Prior to joining the firm, Laura worked for nearly ten years at the Criminal Division of the U.S. Department of Justice, where she served as Assistant Chief of the FCPA Unit and oversaw some of the largest individual and corporate FCPA cases in the U.S. Laura now advises corporations, boards of directors, and senior executives on high-stakes government and internal investigations, crisis management, white-collar criminal defense, and cross-border compliance counseling. She has particular expertise in FCPA/anti-corruption, healthcare fraud, financial fraud, and money laundering cases.

 

Mike Huneke is a Hughes Hubbard & Reed partner specializing in Anti-Corruption & Internal Investigations. His work involves advising clients on navigating complex international anti-corruption investigations, implementing compliance risk assessments and program enhancements, and conducting due diligence on third parties. He has received several awards, including Lexology’s Client Choice Award for Investigations-USA in 2022 and recognition from Global Investigations Review for his work representing Airbus in resolving bribery and corruption allegations.

 

Key ideas you’ll hear in this episode:

  • The Department of Justice’s corporate enforcement policy has been expanded to a broader range of white-collar crimes. Prosecutors can use it to evaluate possible criminal violations against a company when investigating potential criminal violations. It’s also an unofficial guide for companies to position themselves to avoid prosecution or mitigate consequences.
  • The new policy offers a 75% discount for self-reporting, a significant change, and an additional incentive for companies to self-report.
  • The discounts offered can stack up quickly, and the range of penalties for non-compliance can be large so the discount can make a marked difference in the amount of criminal penalty under the sentencing guidelines.
  • There may still be apprehension about self-reporting, as there is uncertainty about the actual penalties and the reputational harm that can result from a public criminal resolution.
  • The definition of extraordinary cooperation is subjective and largely depends on the speed and fulsomeness of the material going from the company to the department.
  • Proactive cooperation, being efficient in conducting an internal investigation, and being the one to come to the department with a good rhythm and cadence are all ways to stay on the good side of extraordinary cooperation.
  • The decision to self-disclose still depends on whether the company thinks the issue will come out or not and the pros and cons of self-disclosure need to be weighed in a case-specific analysis.
  • The more guidance that comes out in speeches, policy memos, or resolutions and declinations, the better companies will be able to evaluate the value of self-disclosure.

 

KEY QUOTES:

“One of the major [changes to the Corporate Enforcement Policy is] increasing the maximum potential fine reduction a company can get for self-reporting. It’s a further effort by the Department to incentivize self-reporting.” – Laura Perkins

 

“I think [the updated Corporate Enforcement Policy] does provide a clear incentive for companies to continually maintain a good compliance program and controls that can detect these violations.” – Laura Perkins

 

“I think the more that the government can show examples of the application of this increased benefit for exceptionally cooperating recidivists and ABB is a great example of that.” – Mike Huneke

 

“[The Corporate Enforcement Policy is] also the unofficial guide for companies and how they can position themselves best in the event of a problem to avoid prosecution either or to mitigate the consequences.” – Mike Huneke

 

Resources:

Hughes Hubbard & Reed website

Laura Perkins on LinkedIn

Mike Huneke on LinkedIn

Categories
All Things Investigations

All Things Investigations: Episode 20 – FTX – What’s the Current Status with Amina Hassan

Welcome to the Hughes Hubbard Anticorruption and Internal investigation Practice Group’s podcast, where host Tom Fox and members of the Hughes Hubbard Anticorruption and Internal Investigation Practices Group delve into the legal issues surrounding white-collar and other investigations, both domestically and internationally. In this episode, Tom sits down with Amina Hassan, a litigator in the Hughes Hubbard litigation department. Tune in as they discuss the FTX scandal, one of the most unbelievable stories in recent fraud history.

Amina has been with the firm since graduating law school and has a wealth of experience in the crypto world, handling cross-action security litigation and helping clients navigate the uncertain regulatory and enforcement landscape in the US.

Key ideas you’ll hear in this episode:

  • FTX was the second largest crypto exchange. It was a sprawling group of over 100 entities headquartered in the Bahamas. It offered a crypto derivatives exchange for trading futures on a margin, but not available to US customers.
  • Sam Bankman-Fried was the founder of FTX. Alameda Research was a sister company and one of FTX’s biggest customers, but also borrowers. Money seemed to flow between and through all of the entities in an unusual way which led to the failure and lack of control.
  • The collapse of FTX has brought scrutiny on the SEC’s role in regulating crypto. However, the SEC’s position is that they already have a regulatory structure in place and will continue to enforce it.
  • The SEC has been the most active regulatory agency for crypto enforcement, but other agencies, such as the CFTC, FTC, and CFPB, will likely become more active in enforcing regulations in the crypto space.
  • Sophisticated investors such as pension funds, hedge funds, and large wealth management funds invested nearly a billion dollars in FTX despite having fewer financial statements than the average individual.
  • The FTX scandal is a wake-up call for institutional investors to improve their due diligence in the crypto space. This should include understanding the technology and asking the right questions, such as how wallets are kept and stored.
  • The aftermath of the collapse of FTX may mean challenges for its competitors, such as Coinbase or even Bitcoin.
  • The SEC has taken an enforcement-centric approach towards crypto and has not indicated any plans for rulemaking in 2023.
  • There have been calls for more clarity in existing regulations for the crypto space and for possible specialized agencies like FINRA to be created for the crypto industry.

KEY QUOTE:

“One of the key takeaways from the FTX scandal is really the complete failure and lack of controls.” ~ Amina Hassan

Resources

Hughes Hubbard & Reed website

Amina Hassan on LinkedIn

Categories
All Things Investigations

All Things Investigations: Episode 17 – Kevin Abikoff and Laura Perkins on the FCPA & Anti-Bribery Fall 2022 Alert

 

Welcome to the Hughes Hubbard Anti-Corruption and Internal Investigations Practice Group’s Podcast, All Things Investigations. In this podcast, host Tom Fox and guests Laura Perkins and Kevin Abikoff of the Hughes Hubbard Anti-Corruption & Internal Investigations Practice Group highlight some of the key legal issues in white-collar investigations, locally and internationally.

 

 

Laura Perkins is a Hughes Hubbard partner whose practice focuses on representing clients in Foreign Corrupt Practices Act and white-collar criminal investigations. She also advises clients on issues related to the FCPA, the federal securities laws, the False Claims Act, and other federal statutes. 

Kevin Abikoff is partner, deputy chair at Hughes Hubbard, and Chairman of the firm’s Anti-Corruption & Internal Investigations Practice Group. He specializes in securities and white-collar criminal litigation, enforcement, regulation, and counseling, emphasizing the representation of entities in anti-corruption (including FCPA) matters.

Key ideas we discuss in this podcast:

  • The DOJ’s recent discussions about requiring Chief Compliance Officer (CCO) certifications.
  • The Monaco Memo is a guidance document from the DOJ that sets expectations for prosecutors when investigating and prosecuting companies. 
  • How the Monaco Memo is taking a different approach to monitoring.
  • The Monaco Memo gives companies flexibility in how they approach compliance, demonstrating they take it seriously. 
  • The DOJ can now successfully prosecute internal controls in a criminal context.
  • Assessing the past year in FCPA.

 

Resources

Hughes Hubbard & Reed website 

FCPA & Bribery 2022 Fall Alert

Laura Perkins on LinkedIn

Kevin Abikoff on LinkedIn

 

Categories
All Things Investigations

All Things Investigations: Episode 13 – Tyler Grove on New CFIUS Executive Order

Welcome to the Hughes Hubbard Anti-Corruption and Internal Investigations Practice Group’s Podcast, All Things Investigations. In this podcast, host Tom Fox and returning guest Tyler Grove of the Hughes Hubbard Anti-Corruption & Internal Investigations Practice Group, highlight some of the key legal issues in white-collar investigations, locally and internationally.

 

 

Tyler Grove has worked at Hughes Hubbard for over 10 years, starting as a paralegal and then working his way up to full-time associate before taking the position of counsel. Tyler’s specialties include sanctions and export controls in addition to anti-money laundering and foreign investment issues. His practice has three main areas: compliance counseling, enforcement and investigations, and corporate diligence and filings.

Key areas we explore on this podcast are:

  • The genesis of Executive Order 14083 relating to CFIUS, and what it entails.
  • It’s become a standard follow-up question when making CFIUS filings to ask about a US business’ cybersecurity policies.
  • What is excepted foreign state? 
  • The Biden administration has conducted a holistic approach to business issues that may not have been considered national security issues in the past. 
  • CFIUS has been a flexible tool for the Biden administration to apply foreign policy.
  • How companies should be prepared to respond when asked to provide information or assistance in a CFIUS review.

Resources

Hughes Hubbard & Reed website 

Tyler Grove on LinkedIn

 

Categories
FCPA Compliance Report

Mike Huneke on The General Counsel Role in CCO Certification

In this episode, I visit Mike Huneke, a partner at Hughes Hubbard. We look at the role of the GC in the CCO certification requirement as first announced by Assistant Attorney General Kenneth Polite and confirmed by Deputy Attorney General Lisa Monaco.

Key areas we discuss on this podcast are:

  • What is the new CCO certification policy?
  • Why did the DOJ create the policy?
  • How has the DOJ’s thinking around recidivists evolved?
  • Reasonableness is not a factual basis.
  • Companies with full transparency are unlikely to have conflicts due to the recent changes in CCO certification.
  • What is the role of the monitor going forward?

Resources

Mike Huneke on Hughes Hubbard

What is the General Counsel’s role in CEO and CCO compliance certifications? On the FCPA Blog

Categories
All Things Investigations

All Things Investigations: Episode 12 – The Monaco Memo with Laura Perkins

 

Welcome to the Hughes Hubbard Anti-Corruption and Internal Investigations Practice Group’s Podcast, All Things Investigations. In this podcast, host Tom Fox and returning guest Laura Perkins of the Hughes Hubbard Anti-Corruption & Internal Investigations Practice Group highlight some of the key legal issues in white-collar investigations, locally and internationally.

 

 

Laura Perkins is a Hughes Hubbard partner whose practice focuses on representing clients in Foreign Corrupt Practices Act and white-collar criminal investigations, including government enforcement actions and compliance counseling. She also advises clients on issues related to the FCPA, the federal securities laws, the False Claims Act, and other federal statutes.

Key areas we explain on this podcast are:

  • How the Monaco Memo instructs prosecutors to evaluate the prosecution of individuals responsible for corporate crime.
  • The Monaco Memo is guiding prosecutors to charge more foreign individuals as opposed to less.
  • Steps a company can take to show timeliness to the DOJ.
  • The Memo underscores the DOJ’s desire for companies to self-report misconduct that they become aware of.
  • Previously, in determining whether a monitorship was appropriate, prosecutors would look at what state your compliance program was in at the time of resolution.
  • The importance of clear communication in understanding the DOJ’s expectations.

Resources

Hughes Hubbard & Reed website 

Laura Perkins on LinkedIn

 

The Hughes Hubbard & Reed website has been updated with the following Anti-Corruption & Internal Investigations advisory:

Cutting Through the Noise: Take‑Aways from the DOJ’s Recent Announcements Regarding Corporate Criminal Enforcement

On September 15, 2022, Deputy Attorney General Lisa Monaco announced a series of policy revisions to the U.S. Department of Justice’s approach to criminal enforcement actions against corporations. At a high level, these new policy revisions show the Department’s desire to take an approach to criminal enforcement that targets the individuals directly responsible for corporate misconduct and encourages companies to assist in preventing misconduct by creating effective compliance programs and cultures. Companies should carefully review these policy changes and identify steps they can take to put themselves in the best position possible should they be subject to a criminal investigation in the future. 

For our discussion about these developments, follow this link to our website.

Practice Co-Chair Laura Perkins will cover this topic in-depth in an All Things Investigations podcast, which will be released on Monday, Sept. 26.

Categories
The ESG Report

Hughes Hubbard & Reed’s New ESG Resource Guide, Part 2

 

Tom Fox welcomes Alexandra Poe, Andrew Fowler, and Bryan Sillaman of Hughes Hubbard & Reed (HHR) to part two of this series of the ESG Report. Hughes Hubbard & Reed released their newest ESG guide with practical guidance about the most common issues in establishing an ESG program. It also gives companies resources to help them comply with the evolving ESG expectations of regulators and investors.

 

 

Key ESG Topics In the Resource Guide

Tom asks Andrew and Alexandra to highlight the key ESG topics seen in the corporate sector that are covered in the resource guide. Alexandra says that before companies tackle any technical compliance concerns they must first understand that “[technical compliance] is a topic that involves governance strategy and mission and culture questions”. This chapter of the resource guide urges corporations to focus on the current trends. 

 

Andrew explains that there are many evolving ESG topics in this new social and political climate, so it may be difficult to choose umbrella topics for the corporate sector. However, he explains that most topics can fall into the category of risk assessment. Stakeholders and investors always need to ensure they’re investing in a safe business, so risk and mitigation planning is always a main issue. 

 

The Regulatory Environment

Tom asks Bryan how he assesses the regulatory landscape. Bryan says that the regulatory environment is constantly and rapidly evolving and it varies from region to region. The EU is more advanced than the US when it comes to regulatory efforts: they have several laws in place to limit greenwashing and identify environmentally friendly activities and sustainable economic activities. However, with the SEC rules in the final stages of being implemented, the US is on pace to become an ESG-friendly landscape. 

 

ESG From An Investor’s Perspective

Tom asks Alexandra to discuss how ESG is viewed by funds and investment advisors. Alexandra explains that ESG is viewed as an expensive commodity within the US. ESG regulations are better implemented by the private sector. The private sector is more likely to urge itself and government-based companies to make better disclosures and examine their practices better. She points out that companies always follow through with the ESG regulatory efforts they implement because it boosts their public image and aligns with their mission statement. 

 

Resources

Alexandra Poe | LinkedIn 

Andrew F. Fowler | LinkedIn

Bryan Sillaman | LinkedIn 

Hughes Hubbard & Reed | How to ESG: A Resource Guide for Establishing an ESG Program for your Company

 

Categories
All Things Investigations

All Things Investigations: Episode 8 – ABC Enforcement in Mexico and Brazil with Diego Duran and Salim Saud

 

Welcome to the Hughes Hubbard Anti-Corruption and Internal Investigations Practice Group’s Podcast, All Things Investigations. In this podcast, host Tom Fox and Diego Duran and Salim Saud of the Hughes Hubbard Anti-Corruption & Internal Investigations Practice Group highlight some of the key legal issues involved in white collar and other investigations, both domestically and internationally. 

 

 

Diego Duran is a Hughes Hubbard partner and criminal defense attorney licensed to practice in some parts of the US and Mexico, where he spent several years working for one of its top boutique law firms. Salim Saud is an attorney and partner based in Rio de Janeiro, Brazil, at Saud Advogados, in association with Hughes Hubbard. He specializes in anti-corruption and is also the coordinator of the Anti-Corruption Compliance practice at FGV.

Key areas we discuss on this podcast are:

  • The Mexican administration’s approach to anti-corruption investigation and enforcement.
  • Corporate criminal liability is a fairly recent concept in Mexican law.
  • Mexico’s National Digital Platform is anticipated to be a centralized database designed to host and process information about federal and state officials.
  • Brazil has two systems for anti-corruption enforcement; one is led by the CGU and AGU, and the other is led by the NPF.
  • Assessing the impact of COVID-19 on Brazilian anti-bribery and anti-corruption investigation and enforcement efforts. 
  • Highlights of Brazil’s recent regulations surrounding their anti-corruption law, the Clean Companies Act.

Resources

Hughes Hubbard & Reed website 

Diego Duran on LinkedIn

Salim Saud on LinkedIn

 

Categories
The Corruption Files

Uncovering the Hidden Schemes in Pharma with Tom Fox and Michael DeBernardis

Thomas Fox and Michael DeBernardis shed light on the bribery schemes highlighted in the cases of Eli Lilly, Fresenius, and Teva and present the prosecutorial investigation, the questionable donations and expenses, preventative measures for companies to implement, and practicing due diligence to minimize risk.

Key points discussed in the episode:
✔️ Thomas Fox introduces the cases involving Eli Lilly, Fresenius, and Teva.
✔️ Michael DeBernardis breaks down the DOJ and SEC’s investigative process in uncovering Eli Lilly’s bribery schemes – by looking into other companies from similar industries and asking the pressing questions.
✔️ Thomas Fox describes the bribes made: money going to hospitals and to the doctors and nurses directly, sending individuals to five-star resorts for fake conferences and speeches, and paying for articles that were never published. Any prior SCC reinforcement action is already a red flag.
✔️ The Eli Lilly case has made companies warier of working with government officials as a Polish state-owned health organization was involved. Also, the intent of the fraudulent talks and events was fairly obvious from a prosecutorial perspective.
✔️ Michael DeBernardis and Thomas Fox share advice on how companies should approach charitable donations: Know where your money is going, do background checks on the receiving organization and publicize all donations.
✔️ Eli Lilly’s exceeding discount for a certain distributor was pushed to the spotlight. Overriding internal controls requires documenting for a business reason. Most due diligence problems can be solved by looking closer at business justifications.

Categories
The Corruption Files

Energy Violations and the Panalpina Settlements with Thomas Fox and Michael DeBernardis

Thomas Fox and Michael DeBernardis discuss energy cases considered FCPA violations, highlighting Panalpina Settlement Day, the uncovered bribery methods, and its implications on the future of compliance, the written policies, and the solutions to commerce and transactions in higher-risk jurisdictions.

Key points discussed in the episode:
✔️ Tom Fox introduces the cases involving Shell, Transocean, Tidewater, Pride International, and Noble.
✔️ Michael DeBernardis describes the company’s methods as a hub-and-spoke arrangement and lays out the Department of Justice’s investigative process. The case has planted the seeds of the pilot program and corporate enforcement policy. The DOJ has become more deliberate in announcing settlements
✔️ Due diligence requires visibility across all aspects of the business. Thomas Fox shares a snippet of advice from a shipping company executive: “If you have a vendor with a 100% success rate, you have a problem.” Any business model based on bribery and corruption never ends well.
✔️ Panalpina’s methods were an open secret across other energy companies, designing ways to circumvent Nigerian customs. Monitoring during this time was less rigorous.
✔️ Due diligence is an ongoing process of improvement. High-risk jurisdictions for particular transactions are now thrown at the forefront.
✔️ Companies outside of the oil and gas industry have started to reconsider their strategies in high-risk areas. The solution is not to stop doing business completely but to work with companies that do compliance.
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