The Real Explanation for the Record Year for FCPA Enforcement

by Michael Volkov
Contact

I am not an “I told you so” person – frankly, it is a very unattractive character trait. I am more comfortable with the old adage – even a broken clock is correct twice a day. I fall into that category.

All the FCPA prognosticators, predictors and paparazzi have missed the boat on understanding what happened this year – 2016, to make this a record year in FCPA enforcement. As a former public servant for over 20 years, I am very familiar with the inner workings of the government, how it operates, how things can change. Much of the government is set in stone and no matter who is in power, it is very difficult to change.

Over the last decade we have seen a number of trends in FCPA enforcement. The Justice Department has forged new and important relationships with global partners. DOJ has consistently articulated a mission to defeat corruption, wherever and whatever form it takes. No one can defend corrupt schemes and no one even tries to push back against the government’s initiative.

As part of this bipartisan, collective initiative in the government, and most especially at DOJ, the government has allocated more resources to the FCPA Unit in DOJ and more prosecutors have been assisting from the US Attorneys Offices. Add to that the rapid increase in FBI resources with the creation of three separate squads dedicated to fighting corruption, and that is why we are now standing at the finish of a record-setting year in FCPA enforcement.

I have always explained that when resources are allocated in the government for a specific purpose then the result is bound to happen. Why? The FBI agent, DOJ prosecutors, and AUSAs have to justify their existence and their assignment. FBI squads are measured by their performance – cases, impact and overall accomplishments. DOJ prosecutors build their own success stories by the cases they bring, the accomplishments they achieve, and the ultimate success of the FCPA Unit, as reflected in the numbers that are recorded.

In the new administration you will be able to understand its priorities by the movement of resources. More prosecutors to terrorism cases will result in more cases being brought. We are unlikely to see any change in resources allocated to the FCPA Unit and, for that reason, the number of cases is likely to continue at a high rate like 2016.

Similarly, when the FBI modifies its allocation of resources, you will see changes in the number of cases ultimately brought by DOJ. Government prosecutors work closely with the FBI to build cases, to gather records, conduct undercover operations, interview witnesses, and charge companies and individuals. In the FCPA context, we are witnessing the fruits of many years of hard work by prosecutors and FBI agents. There is no reason to think that 2017 will be any different from 2016 in terms of FCPA cases.

Case numbers can go up and down each year depending on the number of cases in the pipeline and where they are in the prosecution stages. 2015 was an anomaly because of specific directives from DOJ’s criminal division to refine the prosecution of FCPA cases, resulting in the adoption of the FCPA Pilot Program.

As we move forward, I see more changes on the horizon. Most especially in the area of government expectations of companies relating to ethics and compliance programs. Companies should take heed of this trend and redouble their efforts when it comes to compliance. The list of basic requirements for an effective compliance program has evolved and will continue to do so. I will outline these changing expectations in future postings. For now, CCOs have to be mindful of the new era of FCPA enforcement and the need to mitigate enforcement risks by implementing an effective ethics and compliance program.

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.

© Michael Volkov, The Volkov Law Group | Attorney Advertising

Written by:

Michael Volkov
Contact
more
less

The Volkov Law Group on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.