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 Brandon Garrett
Monday, the University of Virginia School of Law launched a newly revamped registry containing documents and data related to federal corporate prosecutions. The database, called the Corporate Prosecution Registry, allows researchers to view more than 3,000 decision documents, many of them previously hard to find or once shielded from the public eye, while also allowing them to better search specific subject matter and look at overall trends. Continue reading
by Brandon L. Garrett, Nan Li, and Shivaram Rajgopal
A company facing charges will present a “Chicken Little routine” describing the dire consequences of a prosecution for the company, then-U.S. Attorney for the Southern District of New York Preet Bharara famously explained. Yet typically, after settling the criminal case, “the sky does not fall.” Instead, Bharara maintained, all too often “the sky brightens,” the firm is seen as having put its problems behind it, and “the CEO even gets a raise.” Other commentators have been skeptical that prosecutions of a company alter behavior of high-level officers such as CEOs. To be sure, sometimes the CEO appears to be affected by a possible prosecution of the company. The CEO of Wells Fargo recently stepped down before any criminal prosecution was initiated, after civil enforcement and high-profile Congressional hearings brought public attention to bear on unlawful sales tactics the bank used. Perhaps the culture of not taking responsibility at the top is changing. Or perhaps cases like that of the Wells Fargo CEO are salient examples only because it is so rare that a CEO is made accountable, in some measure, for corporate crimes. Continue reading
by Eric Young and Brandon Lauria
Confidentiality and employment agreements have not historically been a matter of concern for the nation’s leading securities regulator. However, since August, the SEC has settled eight enforcement actions involving allegations of improper conduct with respect to employment agreements as part of its efforts to encourage, protect and reward whistleblowers. If this enforcement blitz surrounding Rule 21F-17 continues, it could ultimately change the terms of confidentiality provisions at a far ranging list of employers from publicly traded companies to financial institutions to government contractors.
What is SEC Rule 21F-17? It is the 2011 regulation adopted by the SEC as part of the rules governing its Dodd-Frank Act authorized whistleblower program. It prohibits, with a few small exceptions, “any action to impede an individual from communicating directly with the Commission staff about a possible securities law violation, including enforcing, or threatening to enforce, a confidentiality agreement ….” 17 C.F.R. 240.21F-17(a). In short, it bars efforts to impede whistleblowers from reporting misconduct to the SEC. Continue reading
by Michael W. Peregrine
Delaware court interpretations of the Caremark standard provide a daunting pleading barrier to derivative actions based on alleged breach of compliance oversight responsibilities. The Chancery Court’s October 18 decision in Reiter v. Fairbank is particularly notable for its thoughtful analysis of the duty of oversight. But corporate leadership should recognize that these decisions may not provide impenetrable protection to them, and to the corporation, from compliance-based liability exposure, especially in the current individual accountability environment. Continue reading
Courtesy of Deputy Attorney General Sally Quillian Yates
It’s great to be here today with so many people involved in the fight against international corruption. The diversity of this crowd – which includes folks from the public and private sector, from the United States and abroad, and from many different industries – demonstrates both the wide scope and the deep impact of our anti-corruption effort.
I’ve spent much of my professional career at the Department of Justice. During my time as an Assistant U.S. Attorney and U.S. Attorney in Atlanta, I had the opportunity to prosecute and supervise a wide variety of cases, from drug trafficking to corporate fraud to domestic terrorism. But I’ve always had a particular focus on corruption matters. Early in my career in Atlanta, when I served as the chief of our Fraud and Political Corruption Section, I saw the corrosive impact of corruption – from big-city mayors pocketing government funds to small-town officials peddling their influence to the highest bidder. The damage caused by this type of illegal activity is real and significant. It undermines the public’s faith in our democratic institutions. It gives a bad name to the vast majority of public servants who care deeply about doing what’s right. And by allowing decisions to be made based on personal greed rather than public benefit, corruption deprives our citizens of their right to good, effective governance. Continue reading
by Walt Pavlo
I once told someone that I helped people prepare for a stay in Federal Prison and they thought that I was just kidding. As they asked me, “Prepare for what? Don’t you just go?” The truth is, there is a lot to be done.
At the Compliance & Enforcement blog we write about enforcement and compliance, but what isn’t always apparent is that a lot about enforcement is people going to prison. Many of those convicted of white collar crimes spend many months, or years, prior to reporting to prison. In one case that I wrote about extensively, Ross Mandell of Sky Capital was indicted on federal charges for securities fraud in July 2009, went to trial in June 2011, and was found guilty in July 2011. He was sentenced to prison (12 years) in May 2012 and entered prison in September 2014. That is a span of over five years! Continue reading
by Anouck Giovanola and Justin Spiegel
On April 5, 2016, the Department of Justice’s Fraud Section announced a new Foreign Corrupt Practices Act (“FCPA”) enforcement pilot program (the “Pilot Program”) designed to “promote greater accountability for individuals and companies that engage in corporate crime by motivating companies to voluntarily self-disclose FCPA-related misconduct, fully cooperate with the Fraud Section, and, where appropriate, remediate flaws in their controls and compliance programs.” The memorandum announcing the Pilot Program sets forth four prerequisites for corporations seeking to obtain credit under the program—voluntary self-disclosure of the misconduct, full cooperation with the investigation, timely and appropriate remediation, and disgorgement of all profits related to the violation—and describes the additional cooperation credit available to companies under the terms of the Pilot Program. Continue reading