Category Archives: Corruption

Sapin II: Is the Era of Compliance and Criminal Settlements Upon France?

by Margot Sève

This post is an abstract of the article published under the same title in the Revue Trimestrielle de Droit Financier / Corporate Finance and Capital Markets Law Review (Thomson Reuters), as part of the thematic section edited by Michel Perez and Margot Sève entitled “International Financial and White Collar Crime, Corporate Malfeasance and Compliance.”

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On December 9, 2016, France adopted law n° 2016-1691 on transparency, the fight against corruption, and the modernization of the economy.  The law has been commonly called the “Sapin II” law, after French Minister of Finance Michel Sapin who, in 1993, authored the first Sapin law on transparency in politics and public procurement, and sought in 2016 to further enhance transparency and combat corruption.

While France has in recent years certainly made efforts towards more severe punishment for corruption-related offenses, it has nonetheless been criticized for its weak enforcement track record.  For example, while the sanctions for active and passive corruption of domestic officials, active and passive corruption in the private sector, corruption of foreign officials, and influence peddling were increased in 2013, only one company (Total S.A.) was fined between 2000 and 2016 for acts of corruption of foreign public officials.  This lack of enforcement efficiency has led the OECD, as part of its monitoring of countries’ implementation and enforcement of the OECD Convention on Combatting Bribery, to report serious concerns regarding “the lack of foreign bribery convictions in France.” Continue reading

Is Corporate Responsibility for Human Rights the Next Anticorruption?

by Steve Nickelsburg, David DiBari and Rebecca Hekman

The international legal obligation to protect human rights has long been understood to be the province of sovereign states, not of corporations or individuals.  In the United States, litigation against corporations invoking statutes such as the Alien Tort Statute, the Torture Victim Protection Act, and the Trafficking Victims Protection Act has blurred that line – providing private plaintiffs a cause of action to address alleged human rights violations in a variety of circumstances.

The nuance of that litigation would take numerous additional posts to cover, but even against that backdrop, for corporations the general requirement to respect human rights traditionally has been more a matter of social expectation than legal and regulatory requirements, falling under the rubric “corporate social responsibility” (“CSR”) rather than “hard law.” Continue reading

What Does the OECD Know About Organizational Liability?

by Kevin E. Davis

The OECD Working Group on Bribery – the group responsible for monitoring implementation of the OECD’s Anti-Bribery Convention – has just closed a request for comments on the topic of liability of legal persons for foreign bribery. I submitted a comment, and I hope that others did as well, but I am afraid that instead of focusing on the issues I was asked to comment on I focused on my worries about the overall purpose of the exercise.

There is no question that the issues raised by the OECD are important. Imagine if the U.S. legal system did not have corporate criminal liability, how would it affect the scope and the intensity of corporate compliance? Would we still have compliance officers reporting directly to the board, supplier agreements replete with anti-corruption reps and warranties, and multi-million dollar internal investigations? Consider the potential effects of even a modest reform, such as treating the existence of an effective compliance program as a complete defense. Or, moving in the opposite direction, what if firms convicted of foreign bribery were automatically disbarred from all government contracts? Continue reading

Kleptocrats in the Crosshairs

by Sharon Cohen Levin

Let’s say you’re a powerful foreign leader who has accepted millions of dollars in bribe payments, a “Kleptocrat.”  You’ve got a problem: where to stash the loot?  The stacks are too big to stockpile in your piggy bank or sock drawer.  You need to be more creative.   Here is one solution: set up an off-shore company, open a bank account in a jurisdiction with strict bank secrecy laws, load the account with the bribe payments you received, and then buy premium real estate in the United States.  Voila – clean money.

Not so fast. Continue reading

Rewarding Subtlety: McDonnell v. United States

by Daniel Richman and Jennifer Rodgers

As teachers, we sometimes push our students to clarify their legal arguments by telling them that “subtlety isn’t rewarded.”  As former prosecutors, we like to think that corrupt officials can’t avoid prosecution simply by avoiding B-movie exchanges that they will do “x” if they are given “y.”  This week’s decision in McDonnell v. United States, however, could be a lesson that subtlety may indeed be rewarded, and that gentility could protect a high official from federal corruption charges. Continue reading