FCPA Digest: Recent Trends & Patterns
07/01/2016We are now halfway into 2016. After a few relatively slow years, it appears that 2016 may reflect a return to more active FCPA enforcement as, in the last six months, the two U.S. enforcement agencies, the DOJ and the SEC, have collectively brought as many cases as they did in the entire year of 2015 and more than in the two preceding years. What is interesting, however, is that, although some of the cases involved household corporate names, the penalties were relatively low—with the exception of the VimpelCom case— and the patterns of corruption, albeit with some exceptions, fairly mundane. More controversial have been some of the policy changes announced by the DOJ, placing a premium on voluntary disclosure and cooperation, including overtly and mandatorily “throwing employees under the bus” in exchange for allegedly deeper discounts on penalties and other forms of leniency. Finally, the government continues to explore different types of settlements, at least in form—although the basic elements remain blurry and overlapping—raising the age-old question of whether a rose is indeed a rose by any other name. Among the highlights thus far from 2016 were:
- Twelve corporate enforcement actions with total sanctions of $920.8 million, due in large part to the sanctions levied against VimpelCom, already makes 2016 the third highest year in corporate FCPA sanctions on record;
- The VimpelCom penalty, however, greatly distorts the picture, raising the average corporate sanction for 2016 to $76.7 million, whereas the true average, with outliers excluded, is just $12.5 million—comparable to the 2015 average sanction (excluding outliers) of $11.8 million;
- The cases of Qualcomm and VimpelCom reflect new expansions of the scope of the term “anything of value” in FCPA bribery cases;
- The DOJ announced the FCPA Pilot Program in an effort purportedly intended to increase transparency and efficiency in the DOJ’s FCPA enforcement practices, although its practical benefits may be somewhat illusory.