Tag Archives: Konstantin Bureiko

A Game-Changer for UK Corporate Crime Enforcement? Major Expansion of Corporate Criminal Liability Proposed

by Karolos Seeger, Konstantin Bureiko, Aisling Cowell, and Andrew Lee

Photos of the authors

From left to right: Karolos Seeger, Konstantin Bureiko, Aisling Cowell, and Andrew Lee (Photos courtesy of Debevoise & Plimpton LLP)

Recently, the UK government announced a groundbreaking proposal to reform the identification doctrine—the principle used to hold a company liable for criminal offences committed by those who represent its “directing mind and will”.[1]

For a wide range of offences, including bribery, money laundering, sanctions, fraud and false accounting offences, the actions of a “senior manager… acting within the actual or apparent scope of their authority” will be attributable to his or her employer. The draft wording was added to the Economic Crime and Corporate Transparency Bill, which, as part of the government’s focus on overhauling UK economic crime legislation, already includes a new failure to prevent fraud corporate offence.[2]

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OFSI Publishes Updated Enforcement and Penalty Guidance

by Satish M. Kini, Jane Shvets, Karolos Seeger, and Konstantin Bureiko

Key takeaways:

  • On 8 June 2022, the United Kingdom’s Office of Financial Sanctions Implementation (OFSI) announced that its new strict liability enforcement standard and updated accompanying guidance would take effect on 15 June 2022.
  • The guidance reflects key measures in the Economic Crime (Transparency and Enforcement) Act 2022, including: the new strict liability test for imposing civil monetary penalties; changes to the review of monetary penalties; and a new ability for OFSI to publish details of breaches where it has not imposed a monetary penalty.

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SEC Brings its First Corporate Anti-Corruption Action of 2022

by Kara Brockmeyer, Andrew M. Levine, Karolos Seeger, and Konstantin Bureiko

On February 17, 2022, the SEC brought a settled FCPA administrative proceeding against KT Corporation (“KT” or the “Company”), a South Korean telecom operator with American depository shares trading on the New York Stock Exchange.[1]  In its Cease-and-Desist Order (the “Order”), the SEC found that KT engaged in multiple schemes to make improper payments in Korea and Vietnam, including through purported charitable donations and third-party payments.  The SEC also found that KT paid executives inflated bonuses in order to generate slush funds to pay for gifts and illegal political contributions.  As a result of the settlement, the Company agreed to pay $6.3 million in disgorgement and civil penalties, and to a two-year reporting obligation.[2]  The settlement with the SEC came several months after the Company and fourteen executives were indicted in South Korea for the political contribution scheme.

Of particular note, the KT settlement is the SEC’s most recent action involving charitable contributions, and it goes somewhat beyond earlier cases in that the Order does not find that the donations were made as part of any quid pro quo.  It is also a cautionary tale demonstrating various ways that slush funds can be created.

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UK Introduces Magnitsky-Style Human Rights Sanctions Regime

by Karolos Seeger, Jane Shvets, Catherine Amirfar, Andrew M. Levine, Natalie L. Reid, David W. Rivkin, Alan Kartashkin, Konstantin Bureiko, and Martha Hirst

On 6 July 2020, the UK implemented a new sanctions regime targeting global human rights abuses, which allows the UK government to impose asset freezes and travel bans on persons it determines to have committed serious human rights violations. These restrictions have initially targeted 49 persons from Myanmar, Russia, Saudi Arabia and North Korea.

This is the first time since Brexit that the UK has diverged from EU sanctions policy. Although many of the targets and restrictions are broadly aligned with the “Magnitsky”-style sanctions previously implemented by the United States and Canada, the UK regime has some important differences. Companies operating in the UK will need to ensure that their sanctions systems and controls reflect this new regime.

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UK Treasury Publishes First Post-Brexit UK Sanctions Regulations and Guidance

 by Jane Shvets, Konstantin Bureiko, Tom Cornell, and Satish M. Kini

On 31 January 2019, the UK’s HM Treasury published the first set of regulations (the “Regulations”) under the Sanctions and Anti-Money Laundering Act 2018 (“SAMLA”).[1] The Regulations are due to come into force on “exit day”—29 March 2019 at 11.00pm—if the UK leaves the European Union without a deal. The UK Office of Financial Sanctions Implementation (“OFSI”) has also published new guidance on post-Brexit financial sanctions, which should be read in tandem with the Regulations.[2] In many respects, the Regulations mirror sanctions measures currently in force in the UK under EU regulations and merely give them an independent statutory footing in the UK. But the Regulations do diverge from established EU sanctions practice in certain places and may require companies in the UK to change their sanctions compliance practices. Continue reading →

Professional Service Advisers in the United Kingdom Under New Obligations to Report Suspicions of Financial Sanctions Breaches

by Satish M. Kini, Carl Micarelli, Alex Parker, and Konstantin Bureiko

On August 8, 2017, the United Kingdom (“UK”) broadened the obligation to report known or suspected financial sanctions breaches to apply to a range of professional service providers and certain businesses, including lawyers, external accountants and auditors. This reporting obligation reflects a wider trend of the UK government taking a more proactive approach to enforcing sanctions compliance.[1]

This reporting obligation is now similar in scope to the money laundering reporting obligations, as imposed by the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017.[2]

As well as impacting the internal compliance policies of professional services firms operating in the UK, this new obligation may also impact the dealings of their clients, particularly in a mergers and acquisitions context. It is also likely to significantly increase the number of reports made to the UK’s Office of Financial Sanctions Implementation (“OFSI”). Continue reading →