AGG’s Government Investigations Team Insights provides periodic updates covering legal and regulatory topics. Our team, which includes former federal prosecutors, SEC enforcement attorneys, and federal agency attorneys, has successfully represented companies and individuals, including executives of public companies, in numerous civil and criminal investigations, including before the U.S. Department of Justice and U.S. Attorney’s Offices, the SEC, the EPA, the FDA, the FTC, and many other federal and state agencies.
In this edition, we cover the government’s plans to investigate PPP loan fraud, increased FCPA risks for medical companies in Brazil and Latin America, the Department of Justice’s recent guidance on settling civil actions based on an ability to pay, and the importance of a recent FTC enforcement action against a payment processor.
Where Did the Money Go? The Government’s Review and Investigative Plans for PPP Loan Fraud Take Shape
By: Sara M. Lord
Six months into the largest and most extensive economic relief program in American history, the Department of the Treasury (Treasury) and the Small Business Administration (SBA) are now grappling with the potential for fraud caused by the speed with which it was implemented, limited risk controls, and conflicting guidance. The risks, which were apparent from the beginning, were embedded in an application process that relied on borrower certifications and a limited documents review to determine borrowers’ eligibility. Because the priority was to pump funds into the economy as quickly as possible, the fraud detection effort was largely and effectively shifted to the loan forgiveness process. Read More >
The COVID-19 Pandemic: Increased Anticorruption Risks for Medical Companies in Brazil and Latin America
By: John P. Rowley III and Micah Kanters
The COVID-19 pandemic has dramatically changed the way many of us now work. While this has created unforeseen opportunities, these changes have also brought with them serious, unanticipated consequences. One such consequence is the increased opportunity for corruption. This is especially true for pharmaceutical, technology, equipment, and other medical companies. Warnings about the increased compliance risks were an important theme of the virtual “Brazil 2020” conference that the American Conference Institute held on September 23-24, 2020. Read More >
How Much Money Do You Have? DOJ Releases New Guidance on Settling Civil Cases Based on an Ability to Pay
By: Aaron M. Danzig
Last month, the Department of Justice released new guidance for assessing a company’s claim that it is unable to pay the amount of money demanded by the DOJ to settle a civil lawsuit. When the DOJ brings a lawsuit seeking damages or penalties from an entity, while the entity may be interested in settling, it may seek to claim that it does not have sufficient funds to satisfy the amount demanded by the government. This is particularly prevalent in False Claims Act cases where the government’s demand – up to treble damages plus up to $23,331 per false claim allegedly submitted – can be astronomical and draconian. Read More >
Blind Eyes and Active Assistance: An FTC Commissioner Sheds Light on Regulatory Expectations for the Payments Industry
By: Edward A. Marshall and Erin E. Doyle
Regulatory scrutiny of the payments industry remains intense. Meanwhile, regulators’ expectations of payment processors, ISOs, and payment facilitators have never been higher. Recent enforcement actions have not been limited to those instances where an acquirer crafted elaborate schemes to conceal merchant identities or alarming chargeback ratios. Rather, the Federal Trade Commission (“FTC”) has seemed at times to scrutinize processors where the alleged warning signs of consumer deception were somewhat obscure and the warning flags, if hued with red at all, were at best a dark pink. Read More >