Category Archives: DPAs and NPAs

Two Truths and a Lie About Settlements in Bribery Cases

by Pascale Hélène Dubois, Kathleen May Peters, and Roberta Berzero

If we were playing “Two Truths and a Lie,” we would say the following: (a) settlement agreements are used in a variety of jurisdictions as an alternative to litigation; (b) settlement agreements can offer parties the opportunity to save time and resources while securing a predictable outcome; (c) there is a book that will tell you everything you need to know about settlements in bribery cases. The last, of course, is the lie. But only until Spring 2020.

What do settlements within the World Bank Group Sanctions System look like? Why do entities and individuals choose to enter into settlements with the Bank Group? How do settlements support the Bank Group’s mission to further development impact and contribute to safeguarding donor funds in the projects it finances worldwide? These and other questions will be addressed by the chapter “Settlements Within the World Bank Group Sanctions System” to be published in spring 2020 in the forthcoming book from Edward Elgar Publishing, “NEGOTIATED SETTLEMENTS IN BRIBERY CASES – A Principled Approach,” edited by Tina Søreide, Norwegian School of Economics (NHH), Norway and Abiola Makinwa, The Hague University of Applied Sciences, the Netherlands. Continue reading

DOJ Updates FCPA Corporate Enforcement Policy

By Jonathan S. Kolodner, Lisa Vicens, and Lorena Michelen

In a recent speech at the annual ABA White Collar Crime Conference in New Orleans, Assistant Attorney General Brian Benczkowski of the Criminal Division of the Department of Justice (“DOJ”) announced certain changes to the FCPA Corporate Enforcement Policy (“the Enforcement Policy” or “Policy”) to address issues that the DOJ had identified since its implementation.[1]  These and other recent updates have since been codified in a revised Enforcement Policy in the Justice Manual.[2] 

The Enforcement Policy, first announced by the DOJ in November 2017, was initially applicable only to violations of the FCPA, but was subsequently extended to all white collar matters handled by the Criminal Division.[3]  The Policy was designed to encourage companies to voluntary self-disclose misconduct by providing more transparency as to the credit a company could receive for self-reporting and fully cooperating with the DOJ.  Among other things, the Enforcement Policy provides a presumption that the DOJ will decline to prosecute companies that meet the DOJ’s requirement of “voluntary self-disclosure,” “full cooperation,” and “timely and appropriate remediation,” absent “aggravating circumstances” – i.e. relating to the seriousness or frequency of the violation.  For more information on the Enforcement Policy, read our blog post explaining it

The most significant recent changes to the Enforcement Policy include eliminating the prohibition on a company’s usage of ephemeral instant messaging applications to receive full credit for “timely and appropriate remediation.”  Additionally, the modified Enforcement Policy (1) now makes clear that one requirement of cooperation, de-confliction of witness interviews, should not interfere with a company’s internal investigation; (2) confirms based on an earlier announcement, that the Policy applies in the context of a merger and acquisition (“M&A”), if an acquiring company discovers and self-discloses misconduct in a target; and (3) implements a change announced months before by the Deputy Attorney General that a company only needed to provide information about individuals “substantially involved” in the offense.  These changes are discussed in greater detail below. Continue reading

Settlement Agreements under French Sapin II Law: In Search of the ‘Public Interest’

by Luca d’Ambrosio

This post is an abstract of the article forthcoming in the Revue de sciences criminelles et droit comparé (n° 1/2019) under the title L’implication des acteurs privés dans la lutte contre la corruption: un bilan en demi-tente de la loi Sapin 2.

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Much has been reported about the adoption, on December 2016, of the new French anticorruption framework, Sapin II, which  stands out for the creation of a new set of ex ante and ex post measures aiming to strengthen the prevention of corruption and the enforcement of administrative and criminal sanctions.

Among the ex post measures, Sapin II introduced a procedure permitting a negotiated outcome for legal persons: under the name of “convention judiciaire d’intérêt public” (CJIP), this procedure emulates DPAs as practiced in the United States and in the United Kingdom. The legal transplant of this procedure into the French enforcement system has received far from unanimous consent.   

On the one hand, French scholars were divided among those who considered this procedure as a “gift” to corporations and those who considered it as a milestone of a new and effective corporate enforcement policy based on compliance and cooperation. According to this view, settlement agreements would enhance corporate enforcement policy for three reasons. Firstly, they would help enforcement authorities to resolve quickly and costless complex criminal cases. Secondly, they would enhance specific deterrence of future misconduct through remedial compliance programs. Finally, settlement agreements would trigger anticorruption cooperation and enforcement with US authorities: this argument was particularly sensible in France where important and strategic companies – such as Alstom, Société Générale, Total et Alcatel – have been involved in FCPA investigations and are in the “top ten” of the most important fines settled by the DOJ. Continue reading

Canadian Corporate Criminal Liability

by Lincoln Caylor and Nathan Shaheen

Introduction

In Canada, corporate criminal liability is increasingly becoming an area of focus for regulators, law enforcement officers, and the public. As stories of corporate wrongdoing have generated media and public interest, key stakeholders have been trying to develop various tools and mechanisms to properly apportion fault and determine liability in often complex and highly public scandals. One merely has to read about the SNC-Lavalin matter that has generated controversy and the calls for a public inquiry in the highest echelons of the Canadian executive branch to understand the importance of carefully managing corporate criminal liability. This blog posts reviews Canadian corporate criminal liability, setting out some new developments in the law and highlighting key areas of concern for corporations undertaking either an internal investigation or being investigated by a regulator.

Overview Of Canadian Corporate Liability Doctrine

In Canada, corporate criminal liability is narrow in scope. Unlike in the United States, Canada does not apportion criminal liability under the doctrine of respondeat superior. Rather, corporate liability is generally apportioned to the employees or individuals involved in the wrongdoing, instead of the actual corporations themselves.[1]

Unlike American precedent, Canadian jurisprudence has historically upheld the ‘identification doctrine’, an organizing principle of corporate liability wherein an “identity” is established “between the directing mind and the corporation, which results in the corporation being found guilty for the act or the natural person, the employee”.[2] The identification doctrine will only be used in narrow circumstances to hold the corporation accountable. It will not be engaged if the employee/individual who committed the alleged acts is not a ‘directing mind’ of the corporation, or if there was fraud on the corporation. Additionally, judges retain the residual right to not apply the doctrine depending on the circumstances of the case. Continue reading

English High Court Considers Status of Internal Investigation Interview Notes

by Karolos Seeger, Andrew Lee, and Robin Lööf

In R (AL) v Serious Fraud Office,[1] the English High Court considered the SFO’s obligations to individuals prosecuted following the deferred prosecution agreement (“DPA”) in July 2016 with a company anonymised as “XYZ Ltd”. The Court’s decision is likely to force the SFO to adopt a much more aggressive approach in relation to company counsel’s notes of interviews conducted during a company’s internal investigation. In particular, when those interview notes are potentially relevant to the defences of individuals being prosecuted, this judgment is likely to lead to the SFO putting further pressure on companies to produce the notes, through court proceedings if necessary. We analyse these and other issues covered by the judgment below. Continue reading

Singapore Introduces Deferred Prosecution Agreements

by Zachary S. Brez, Brigham Q. Cannon, Mark Filip, Asheesh Goel, Cori A. Lable, Kim B. Nemirow, Abdus Samad Pardesi, Richard Sharpe, William J. Stuckwisch, Marcus Thompson, Satnam Tumani, and Jodi Wu

On 19 March 2018, Singapore passed legislation introducing the concept of the deferred prosecution agreement (“DPA”) to the jurisdiction for the first time. Under the new laws, corporations (but not individuals) facing prosecution for offences of corruption, money laundering or receipt of stolen property may attempt to negotiate the terms of a DPA with prosecuting authorities, under which they would avoid prosecution, in return for adherence to various conditions imposed upon them, for a set period of time.

By introducing the DPA as an enforcement tool, Singapore joins the ranks of the United States[1], Brazil[2], the United Kingdom[3] and France,[4] which form the vanguard of an increasingly consistent global approach to corporate criminal resolutions. Australia and Canada are also both currently evaluating whether to introduce similar legislation. Continue reading

The Jury is Out on Compliance in the First Test of the Bribery Act’s Adequate Procedures Defence

by Omar Qureshi, Iskander Fernandez, and Amy Wilkinson

Last month saw the first contested prosecution of a corporation for failure to prevent bribery under section 7 of the U.K. Bribery Act 2010 (the “Bribery Act”), providing the first insights into how such a case may be argued and determined.  The defendant company Skansen Interiors Limited (“SIL”) was found guilty of failing to prevent bribery by one of its employees, who paid £10,000 (and offered, and tried to secure payment of a further £29,000) to another in order to secure two contracts for SIL.  The individuals involved had already pleaded guilty to substantive bribery offences.

A jury found SIL did not have adequate procedures designed to prevent bribery.  While the judge did not give her views on what may constitute adequate procedures and why SIL’s fell short, the jury’s verdict indicates that even small companies may need to have documented and targeted procedures in place, specifically addressing bribery prevention, if they are to succeed in proving an adequate procedures defence. Continue reading

First French DPAs for Corruption Offences

by Antoine Kirry, Karolos Seeger, Alex Parker, Alexandre Bisch, and Robin Lööf

On March 5, 2018, French prosecutors published two Judicial Conventions of Public Interest (“CJIPs” or “French DPAs”) approved by the President of the High Court of Nanterre on February 23. The CJIPs, entered into between prosecutors and two sub-contractors to state-owned utility EDF, SAS Kaefer Wanner (“KW”) and SAS SET Environnement (“SET”), allege that these companies had ceded to solicitations to pay bribes to an EDF procurement manager, and that this behaviour amounted to corruption by them of an individual charged with a public service. KW and SET admitted these facts and their legal qualification[1], and agreed to pay financial penalties of €2,710,000 and €800,000 respectively and compensation to EDF of €30,000 each. In addition, they agreed to submit to monitoring by the French Anti-corruption Agency (“AFA”) for, respectively, 18 and 24 months.

The KW and SET CJIPs are the first to be concluded in respect of corruption offences. Helpfully, they provide (1) detail on the financial incentive of entering into a French DPA for companies with potential exposure for corruption-related offences in France, (2) clarification that co-operation and remediation can significantly reduce the financial penalty, as well as (3) the first examples of monitorships to be supervised by the AFA. However, the crucial question of how a company can qualify for a French DPA remains largely unanswered. Continue reading

The New DOJ FCPA Corporate Enforcement Policy Highlights the Continued Importance of Anti-Corruption Compliance

by Lisa Vicens, Jonathan Kolodner, and Eric Boettcher

In a significant development for companies relating to the Foreign Corrupt Practices Act (FCPA), in late November the U.S. Department of Justice (DOJ) announced a new FCPA Corporate Enforcement Policy (the Enforcement Policy).

The Enforcement Policy[1] is designed to encourage companies to voluntarily disclose misconduct by providing greater transparency concerning the amount of credit the DOJ will give to companies that self-report, fully cooperate and appropriately remediate misconduct. Notably, in announcing the Enforcement Policy, the DOJ highlighted the continued critical role that anti-corruption compliance programs play in its evaluation of eligibility under the Enforcement Policy. Continue reading

Global Anti-Bribery Year-in-Review: 2017 Developments and Predictions for 2018

by Kimberly A. Parker, Jay Holtmeier, Erin G.H. Sloane, Lillian Howard Potter, Tetyana V. Gaponenko, Victoria J. Lee, and Roger M. Witten

This past year marked the 40th anniversary of the U.S. Foreign Corrupt Practices Act (“FCPA”).  Since its enactment in 1977, the U.S. Department of Justice (the “DOJ”) has brought approximately 300 FCPA enforcement actions, while the U.S. Securities and Exchange Commission (the “SEC”) has brought approximately 200 cases.[1]  This anniversary year, the first year of the Trump administration, demonstrated that the FCPA continues to be a powerful tool in combating corruption abroad and encouraging compliance at global companies.

Below are six key take-aways regarding FCPA enforcement in 2017: Continue reading