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
by Avi Gesser, Kelsey Clark, Jennifer E. Kerslake, and Eric McLaughlin
In our first Cyber Blog post, we predicted that the rules-based approach adopted by the NYDFS would become the model for cybersecurity regulation. Two years later, we’re feeling pretty good about that prediction, as the FTC recently proposed incorporating a number of aspects of the NYDFS cybersecurity rules into its Standards for Safeguarding Customer Information rule (the “Safeguards Rule”). The proposal would also expand the Safeguards Rule’s definition of “financial institution” to include “finders,” or companies that connect potential parties to a transaction. As a reminder, the Safeguards Rule applies to financial institutions that are not regulated by the federal banking agencies, the SEC, or state insurance authorities, including non-bank mortgage lenders, payday lenders, finance companies, check cashers, money transmitters, collection firms, and tax preparers. Continue reading
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.
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
by Lincoln Caylor and Nathan Shaheen
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.
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”. 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
by Sebastian Schich
The views expressed within this post are those of the author alone and do not represent those of the OECD or its member countries.
A decade after the global financial crisis, most of the financial regulatory reform package to make the system stabler and fairer has been completed. The agenda is is now changing to evaluation of reform effects. This post draws on a recent article on implicit bank debt guarantees  and asks whether the progress in limiting them has made the financial system fairer.
The financial regulatory reform, designed and subsequently rolled out over the past decade following the global financial crisis, is explicitly described as an attempt to make the international financial system fairer. In defining what is involved in this goal, the Financial Stability Board (FSB), an international body set up in April 2009 to monitor and make recommendations about the global financial system, refers to large banks at the centre of the financial system that did not internalize the social costs that their excessive risk-taking created. Gains of risk-taking activities were privatized and losses socialized. A fairer system involves funding conditions that are more closely aligned with the riskiness of the entities. In other words, there would be no room for implicit bank debt guarantees. Continue reading
The NYU School of Law Program on Corporate Compliance and Enforcement (PCCE) is pleased to announce that Maria Vullo ’87, former superintendent of the New York State Department of Financial Services (NYDFS), has joined PCCE as a senior fellow.
Vullo served as superintendent of NYDFS for the past three years. In that role, Vullo was responsible for the regulation and supervision of New York’s financial services industry, including New York State chartered banks, branches of foreign banks, and insurance companies and agents licensed to do business in New York. During Vullo’s tenure as NYDFS Superintendent, she issued a nation-leading cybersecurity regulation applicable to all NYDFS regulated institutions; issued a first-in-the-nation transaction-monitoring regulation; resolved significant enforcement actions regarding violations of the Bank Secrecy Act, and anti-money laundering, sanctions and foreign exchange laws.
“Maria Vullo is a valuable addition to PCCE. She brings the combined perspective of a law enforcement official, a regulator, and private practitioner to corporate compliance, just as she did with her nation-leading regulations at NYDFS,” said Professor Jennifer Arlen, founder and faculty director of PCCE. Continue reading
After a wonderful and successful spring semester, PCCE’s current Executive Director, Pablo Quiñones, is transitioning out of that role to start his own law practice, Quiñones Law PLLC. Although brief, Pablo’s tenure as Executive Director was extraordinary. With his help, PCCE substantially increased its law blog readership and held four events, including a full day conference on cybersecurity and a fireside chat with the General Counsel and Solicitor of the SEC. The most recent event, “ICOs and Cryptocurrency: Innovation Meets Regulation,” was planned and executed entirely by Pablo and was held before a packed audience. While we will miss Pablo, he will continue to contribute to PCCE as a Senior Fellow and an Editor of the Compliance and Enforcement law blog, and plans to moderate a panel on compliance monitors at our annual fall conference on October 12, 2018. Please join us in recognizing Pablo’s accomplishments and in thanking him for his exemplary service as PCCE’s Executive Director.
It is time now to search for a new Executive Director. Continue reading
The NYU Program on Corporate Compliance and Enforcement is pleased to announce that Pablo Quiñones will be PCCE’s new Executive Director. Mr. Quiñones will assume his new position on February 1, 2018 and will serve for the rest of the academic year. Next academic year, Mr. Quiñones will return to private practice but will continue to work with PCCE as a Senior Fellow.
Mr. Quiñones joins the Law School after serving as Chief of Strategy, Policy and Training for the U.S. Department of Justice’s Criminal Fraud Section in Washington, D.C. In that role, Mr. Quiñones supervised a unit that worked with senior leaders, supervisors and trial attorneys within the DOJ to develop and implement enforcement strategies, policies, and educational programs related to prosecuting financial crimes. He helped foster cooperation among foreign and domestic government agencies, promote the evaluation of corporate compliance programs and monitors, and implement investigation, prosecution and trial training programs. Among other things, Mr. Quiñones oversaw the Section’s first detail of a prosecutor to a foreign regulator and first expert compliance counsel, assisted in the development of FCPA enforcement policies, and advised on important litigation and appellate matters. Continue reading
by Geoffrey Parsons Miller
Like a hurricane forming off Cape Verde, an important constitutional issue may be on track to reach the Supreme Court in 2017.
As so often happens in great cases, the controversy arose in routine fashion. An administrative law judge employed by the Consumer Financial Protection Bureau imposed a $6 million fine on PHH Corporation for violating the Real Estate Settlement Procedures Act. Rather than meekly accepting the fine, as most private parties would have done, PHH appealed the matter to the director of the agency.
Here’s where things got interesting. Continue reading