Category Archives: Bribery and Corruption

Recalibrating Compliance Programs Under Trump 2.0

by Adam Siegel, Eric Bruce, Daniel Cendan, and Emmeline Chen

Left to right: Adam Siegel, Eric Bruce, Daniel Cendan, and Emmeline Chen (photos courtesy of authors)

Nearly two months into his second presidential term, President Trump and his Administration have engaged in a flurry of activity, issuing over 80 executive orders (EOs), 20 memoranda, and a dozen proclamations, as well as making personnel adjustments and redeploying various federal resources. Together with his Cabinet members, President Trump has sought to swiftly roll out policy initiatives, many of which reflect a significant change in course from the United States’ prior approaches and create uncertainty and new risks across multiple sectors.

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Crippling the FCPA Is Bad Business for the U.S.

by Stephen M. Kohn

Photo courtesy of the author

On February 10, President Donald Trump issued an Executive Order (E.O.) to pause enforcement of the Foreign Corrupt Practices Act (FCPA). The E.O. is based upon the inaccurate premise that the United States’ enforcement of the anti-bribery law unfairly cracks down on U.S. companies and harms their competitiveness in the global marketplace. During the pause, the Justice Department will reevaluate the enforcement strategies behind the FCPA, and presumably approve a new approach to FCPA enforcement. But the intent behind the Executive Order does not bode well for future U.S. prosecutions of criminal bribe paying in foreign countries.

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U.S. Authorities Charge Adani Defendants with Integrity Washing

by Kevin E. Davis

Photo courtesy of NYU

Gautam Adani is the founder of one of India’s largest conglomerates and ranks among the country’s prominent business people. He and his nephew Sagar Adani are learning the hard way that, in the U.S. legal system, the coverup can be treated just about as severely as the crime.

The Department of Justice and the Securities and Exchange Commission have accused the Adani defendants of collaborating with executives of a U.S.-listed Mauritian company called Azure Power Global Ltd. in a massive bribery scheme. The conspirators allegedly paid over USD 250 million in bribes to officials in the governments of several Indian states. The bribes were to induce the officials to purchase power that would be supplied by Adani Green Energy Ltd., an Indian company controlled by the Adani defendants, as well Azure.

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The New ‘Failure to Prevent Fraud’ Corporate Offence — UK Government Publishes Guidance

by Karolos Seeger, Aisling Cowell, Andrew H. Lee, and Sophie Michalski

Left to Right: Karolos Seeger, Aisling Cowell, Andrew H. Lee, and Sophie Michalski (photos courtesy of Debevoise & Plimpton LLP)

On 6 November 2024, the Home Office finally published government guidance on the corporate offence of failure to prevent fraud (the “FTPF Offence”), which was introduced in the Economic Crime and Corporate Transparency Act 2023 enacted last October. The new offence will now come into force on 1 September 2025, giving companies a longer period to prepare than had been expected.

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PCCE Hosts Senior DOJ Officials for a Discussion of the Newly Announced Corporate Whistleblower Awards Pilot Program

PDAAG Nicole Argentieri. (All photos courtesy of Sam Hollenshead, NYU Photo Bureau)

On September 17, 2024, the NYU Law Program on Corporate Compliance and Enforcement (PCCE) hosted Nicole M. Argentieri, Principal Deputy Assistant Attorney General for the Criminal Division, Brent Wible, Chief Counselor for the Criminal Division, and Molly Moeser, Chief of the Money Laundering and Asset Recovery Section, as well as academics and distinguished counsel, for a discussion of the DOJ Criminal Division’s newly-announced Corporate Whistleblower Awards Program. A link to the details of the program is here. Below are the remarks delivered by PDAAG Argentieri. After Argentieri’s remarks, PCCE Faculty Director Jenifer Arlen led a fireside chat discussion with Brent Wible, followed by a moderated panel discussion that included Molly Moeser, Jane Norberg (Partner, Arnold & Porter Kaye Scholer LLP), Preston Pugh (Partner, Crowell & Moring LLP), Dan Richman (Professor, Columbia Law School), Max Rodriguez ’15 (Principal, Max Rodriguez Law PLCC), and Andrew Weissmann (Professor, NYU Law). Opening remarks were delivered by Troy McKenzie, Dean of NYU School of Law.

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Confronting Percoco and Full Play: The Limitations of Honest Services Fraud and the Travel Act as an Alternative Source of Liability for Commercial Bribery

by Hector Correa Gaviria and Berke Gursoy

Left to Right: Hector Correa Gaviria and Berke Gursoy (photos courtesy of authors)

On September 1st, 2023, District Court Judge Pamela Chen delivered a startling decision, overturning the honest services fraud convictions of Hernán Lopez, former Fox executive, and FullPlay Group, S.A., an Argentine sports marketing company. Lopez and FullPlay were convicted of federal wire fraud for bribing employees of the Fédération Internationale de Football Association (FIFA) and CONMEBOL (the South American soccer federation under the umbrella of FIFA) to secure lucrative broadcasting contracts for some of Latin America’s most prestigious soccer tournaments and World Cup qualifying matches.

In United States v. Full Play,[1] a federal jury found that Lopez and FullPlay used U.S. wires to defraud FIFA by depriving the international soccer organization of the right to its employees’ faithful and honest services in violation of 18 U.S.C. §§ 1343 and 1346 (jointly referred to as honest services wire fraud “HSF”). However, soon after this conviction, the Supreme Court in Percoco v. United States limited the scope of HSF.[2] They did so by restricting the sources of fiduciary duty that can support an HSF conviction, holding that a limited number of on-point pre-McNally cases was insufficient to sustain an HSF conviction.[3] Through this ruling, Percoco essentially established a limiting principle for HSF; however, it did not articulate a test for when an actionable fiduciary duty under HSF could be found.[4]

In the wake of Percoco, the defendants in Full Play filed a motion for acquittal on their honest services charges. They argued that under Percoco, honest services fraud does not cover foreign commercial bribery because the statute requires defendants to induce a violation of the bribe-recipient’s fiduciary duty to the victim organization and because the type of fiduciary duty alleged in this case, a duty owed by foreign employees to a foreign employer, is not cognizable under §1346. Judge Chen agreed, holding that there was not “even a smattering” of pre-McNally cases to support the defendants’ HSF convictions.[5]

Though this case is under appeal, the judge’s ruling represents the difficulties of post-Percoco commercial bribery prosecutions through § 1346.[6] This article will argue that the Travel Act, 18 USC § 1952, represents an effective substitute for § 1346 that allows federal prosecution of commercial bribery through both HSF and state-level commercial bribery statutes.

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Shining a Light on the Shadows: A Data-Driven Look at Global Anti-Corruption Efforts

by Leonardo Borlini

Photo courtesy of the author

Corruption has been the target of significant international efforts in recent decades. A complex web of international treaties and monitoring mechanisms has emerged, aiming to curb this global scourge. But how effective are these efforts? Are countries truly implementing and complying with their international anti-corruption commitments?

In my recent study, Compliance Mechanisms as a Diagnostic and Prognostic Tool for the Evolution of the International Anti-Corruption Cooperation: A Data-Driven Study, forthcoming in 22(2) International Constitutional Law Journal (2024), I try to shed light on these questions. Using innovative text-as-data analysis, the study delves into the vast trove of evaluation and compliance reports produced by the monitoring mechanisms established by the main international anti-corruption. The findings offer a comprehensive assessment of the successes, failures, and enduring challenges in global anti-corruption cooperation.

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Risks of Cross Border Operations: Chiquita Brands International Found Liable for Financing Terrorism

by Timothy Harkness, Peter Linken, Scott Eisman, and Maylin Meisenheimer

From left to right: Timothy Harkness, Peter Linken, Scott Eisman and Maylin Meisenheimer (Photos courtesy of Freshfields Bruckhaus Deringer LLP)

Doing business in conflict zones has always been complicated. Increased litigation has compounded those risks in recent years. A June 2024 federal jury verdict against Chiquita Brands International illustrates the changing legal landscape. The jury in Florida found Chiquita liable for financing Autodefensas Unidas de Colombia (“AUC”), a Colombian paramilitary group, and awarded a bellwether group of plaintiffs $38.3 million in damages. A second bellwether trial against Chiquita is scheduled for later this year, and thousands of related claims against Chiquita remain pending. Although the Chiquita litigation has spanned almost two decades, this jury verdict represents the first liability determination and paves the way for the second bellwether trial and eventual resolution of all pending claims. As each plaintiff was awarded around $2 million, Chiquita could be facing hundreds of millions of dollars in damages as the broader litigation includes vastly more victims.

The Chiquita verdict is a signal to corporations that U.S. courts may be more willing to find them liable for actions that occurred abroad and that plaintiffs may increasingly choose to file these claims in U.S. courts. In Chiquita, the alleged actions took place in Colombia and the claims at issue were brought under Colombian law, but this is just one example among many. In Kaplan v. Lebanese Canadian Bank, for example, the Second Circuit held that the plaintiffs plausibly pleaded that Lebanese Canadian Bank had aided and abetted acts of international terrorism under the Antiterrorism Act (“ATA”) by alleging that the bank had processed transactions in Lebanon for individuals closely affiliated with Hezbollah. As companies weigh the risks of doing business abroad and how best to structure their operations, this verdict should be at the forefront of their minds.

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Former Aide to Madagascan President Sentenced for Soliciting Bribes Under UK Bribery Act

by Pamela Reddy, Robin Spedding, and Matthew Unsworth

Left to Right: Pamela Reddy, Robin Spedding, and Matthew Unsworth (photos courtesy of Latham & Watkins LLP)

Sentencing of Romy Andrianarisoa, the first ever foreign public official to be convicted under the UK Bribery Act of 2010, provides important takeaways.

On 10 May 2024, Romy Andrianarisoa was sentenced to three and a half years’ imprisonment for soliciting bribes contrary to Section 2 of the Bribery Act 2010 (Bribery Act). Andrianarisoa, former Chief of Staff to President Andry Rajoelina of Madagascar, requested substantial cash payments in exchange for helping UK-headquartered Gemfields Group Ltd (Gemfields) secure mining rights in the country. Her associate, French national Philippe Tabuteau, was also handed a 27-month sentence for his role in the scheme.

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Congress Passes Foreign Extortion Prevention Act, Targeting “Demand Side” of Foreign Bribery

by Kara Brockmeyer, Andrew M. Levine, David A. O’Neil, Winston M. Paes, Jane Shvets, Bruce E. Yannett, Douglas S. Zolkind, and Erich O. Grosz

Top left to right: Kara Brockmeyer, Andrew M. Levine, David A. O’Neil, and Winston M. Paes
Bottom left to right: Jane Shvets, Bruce E. Yannett, Douglas S. Zolkind, and Erich O. Grosz (Photos courtesy of Debevoise & Plimpton LLP)

On December 14, 2023, the U.S. Congress approved the Foreign Extortion Prevention Act (“FEPA”), which will make it a federal crime for any foreign government official to demand or receive a bribe from a U.S. citizen, resident or company in exchange for taking or omitting to take official action or conferring any improper business-related advantage.[1] This legislation, which is part of the National Defense Authorization Act and expected to be signed into law by President Biden, substantially expands U.S. enforcement authority with respect to foreign bribery and aligns with the Biden Administration’s elevation of anti-corruption enforcement to a national security priority.

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