In 2012, DOJ and the SEC brought 25 new Foreign Corrupt Practices Act (“FCPA”) enforcement actions, a significant decrease from the number of FCPA enforcement actions brought in 2011 (45) and the prolific 2010 (71). However, there is no reason to suspect that DOJ and the SEC are losing their zeal for enforcement. Rather, it is likely that DOJ and the SEC are juggling the approximately 150 open investigations and were distracted by the drafting of their comprehensive FCPA Resource Guide, which was released in November 2012, as well as several trials.

Many trends from 2011 continued into 2012, including DOJ’s and the SEC’s willingness to reward companies for their swift voluntary disclosure and ongoing cooperation. In at least one significant case (U.S. v. Peterson), DOJ and the SEC declined to bring an enforcement action against the individual defendant’s corporate employer, financial services giant Morgan Stanley, noting Morgan Stanley’s rigorous FCPA compliance program, voluntary disclosure, and cooperation. In addition, the trend away from using independent compliance monitors/“consultants,” in favor of self-monitoring and periodic self-reporting, continued. DOJ’s and the SEC’s targeting of the health care and life sciences industries continued to bear fruit. Indeed, more than half of DOJ’s FCPA enforcement actions this year were brought against medical device manufacturers and/or pharmaceutical companies.

On the trial front, the government continued to experience significant setbacks. In early 2012, the government dismissed the charges against the remaining SHOT Show defendants, with the judge noting that the dismissal closed a “long and sad chapter of white collar criminal enforcement.” In May, the government dropped its appeal in Lindsey Manufacturing, in which Venable LLP’s Jan Handzlik was counsel to Lindsey Manufacturing and Dr. Keith Lindsey. The District Court had previously dismissed the convictions for prosecutorial misconduct.

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Topics:  Audits, Compliance, DOJ, FCPA, Investigations, SEC, Self-Reporting, Sentencing, UK Bribery Act, Voluntary Disclosure

Published In: General Business Updates, Criminal Law Updates, Finance & Banking Updates, International Trade Updates, Securities Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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