Tag Archives: David B. Massey

AMLA 2020: New Penalties for Concealing Transactions Involving Senior Foreign Political Figures

by Barak Cohen, David B. Massey, Jamie A. Schafer, David Sewell, and Paul M. Korol

On New Year’s Day 2021, Congress passed the Anti-Money Laundering Act of 2020 (AMLA 2020). The AMLA 2020 included sweeping reforms aimed at strengthening protections against money laundering, terrorism financing, and other illegal activities.

In this article, we examine two new criminal penalties established by the AMLA 2020. In a nutshell, these penalties prohibit concealing or falsifying information related to ownership or control of funds in transactions involving senior foreign political figures and entities designated to be of primary money laundering concern. This is a potentially significant new tool providing for criminal prosecution targeting a broad swath of intermediaries who may be involved in facilitating transactions involving senior foreign political officials, including brokers, nominees, lawyers and any other person or entity that may communicate with a financial institution in the course of a transaction falling under these provisions.

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The Anti-Money Laundering Act of 2020: The Remarkable Expansion of the U.S. Government’s Subpoena Power Over Foreign Financial Institutions

by Barak Cohen, David B. Massey, Jamie A. Schafer, David Sewell, and Bria M. Cochran

On New Year’s Day 2021, Congress passed the Anti-Money Laundering Act of 2020 (AMLA 2020), which included sweeping reforms aimed at strengthening protections against money laundering, terrorism financing, and other illegal activities. In this post, we examine the AMLA 2020’s remarkable expansion of the U.S. Departments of Justice and Treasury’s subpoena authority over foreign financial institutions, which has significant implications for foreign financial institutions maintaining U.S. correspondent accounts Continue reading →

Business Texts on Personal Phones: The Growing Compliance and Enforcement Risk and What to Do About It (Part II of II)

by Margaret W. Meyers, Rachel S. Mechanic, Daniel C. Zinman, David B. Massey, and Shari A. Brandt

This is Part II of a two-part post. For Part I, discussing recent enforcement actions related to employees’ use of personal devices, and the challenges employees’ use of personal devices pose for compliance with books and records and communication supervision rules, click here.

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Business Texts on Personal Phones: The Growing Compliance and Enforcement Risk and What to Do About It (Part I of II)

by Margaret W. Meyers, Rachel S. Mechanic, Daniel C. Zinman, David B. Massey, and Shari A. Brandt

With increasing frequency, securities and commodities regulators are focusing on employees’ use of personal mobile devices for business-related communications via applications that are not approved by employers or captured by employers’ archival systems.  For good reason, regulators believe that many employees are less guarded when texting outside of their surveilled work platforms, particularly among workplace friends and colleagues at other firms, and that some employees may even be doing so to further questionable conduct and evade detection.  Regulators and prosecutors brought waves of cases against financial firms based on messages gathered from persistent multiparty Bloomberg chat rooms, so much so that some big banks shut them down in late 2013.  Text messages on unapproved mobile platforms may well serve as the next goldmine for enforcement staff and prosecutors.    

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DOJ Issues First FCPA Advisory Opinion in Six Years: A Note of Caution and Practical Takeaways

by Jamie A. Schafer, David B. Massey, Lee S. Richards III and Michael D. Mann

On August 14, 2020, the U.S. Department of Justice (“DOJ”) published the agency’s first Foreign Corrupt Practices Act (“FCPA”) Opinion Procedure Release (“FCPA Opinion Release”) since 2014.[1] In this guidance, DOJ confirmed that it would not prosecute a company for commercially reasonable payments made to a state-owned service provider in return for legitimate services rendered where there was no corrupt intent or diversion of money to any individual. As always, FCPA Opinion Releases should be read narrowly because the analysis relates to specific complex circumstances, many of which are not transparent to the reader.

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U.S. v. Connolly: “Outsourcing” a Government Investigation — And How to Avoid It

by David B. Massey, James Q. Walker, Lee S. Richards III, Shari A. Brandt,  Daniel C. Zinman, Arthur Greenspan, Rachel S. Mechanic, and Audrey L. Ingram

Summary

On May 2, in a widely-watched case, the U.S. District Court for the Southern District of New York found that the government “outsourced” a criminal LIBOR investigation to Deutsche Bank and its outside counsel, and thereby violated defendant Gavin Black’s Fifth Amendment rights when outside counsel interviewed the defendant under threat of termination from his employment.  United States v. Connolly, 16 Cr. 370 (CM), Memorandum Decision and Order Denying Defendant Gavin Black’s Motion for Kastigar Relief, ECF Document 432, slip op. at 19, 29 (May 2, 2019).  But because the DOJ did not use the defendant’s compelled statements at trial and the investigation was not otherwise tainted, the Court found no Kastigar violation and held that, even if there was, any error was harmless.  Connolly, slip op. at 40-41, 43-44.  

The Court’s exposition of the “outsourcing” issue has broad implications for internal investigations and corporate cooperation, but it need not end internal investigations or corporate cooperation as we know them.  By observing some basic precautions as described below, Government enforcement lawyers and corporate defense counsel can avoid similar rulings in the future.  At every stage of an internal investigation, companies should confirm and document that their major decisions are taken to satisfy their obligations to their shareholders to police and remediate their own activity, rather than to satisfy demands made by government lawyers.  The Government, for its part, should avoid instructing companies on the particulars of their internal investigations and not wait for the results of those investigations before beginning their own.  If both sides proceed in this way, internal investigations and corporate cooperation can continue  substantially in the way that they have for two decades.  Continue reading →