Courtesy of Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division
One of my priorities in the Criminal Division has been to ensure that we have a robust and transparent enforcement program targeting violations of the Foreign Corrupt Practices Act (FCPA). Bribery of foreign officials harms those who play by the rules, siphons money away from communities, and undermines the rule of law.
Accordingly, in recent months we have announced significant enhancements to the Department’s ability to investigate and prosecute FCPA cases. For example, the Criminal Division’s Fraud Section is adding 10 additional prosecutors to its FCPA Unit, increasing the size of that unit by more than 50 percent. At the same time, the FBI has established three new squads of special agents devoted to FCPA investigations and prosecutions. This should send a powerful message that FCPA violations that might have gone uncovered in the past are now more likely to come to light. And simultaneously, we are strengthening our coordination with foreign counterparts – sharing leads, making available essential documents and witnesses, and more generally working together to reduce criminals’ ability to hide behind international borders. The fruits of this approach can be seen in numerous recent successful prosecutions.
And today, as part of our effort to promote both transparency and accountability, we are launching a one-year pilot program in the Fraud Section’s FCPA Unit, which provides guidance to our prosecutors for corporate resolutions in FCPA cases, and which is designed to motivate companies to voluntarily self-disclose FCPA-related misconduct, fully cooperate with the Fraud Section, and, where appropriate, remediate flaws in their controls and compliance programs.
Transparency in our corporate FCPA charging decisions is important for several reasons. First, transparency enables the public to understand why particular results are reached in particular FCPA cases and helps to reduce any perception that our enforcement decisions may be unreasoned or inconsistent. And second, transparency informs companies what conduct will result in what penalties and what sort of credit they can receive for self-disclosure and cooperation with an investigation. This, in turn, enables companies to make more rational decisions when they learn of foreign corrupt activity by their agents and employees. If a company opts not to self-disclose, it should do so understanding that in any eventual investigation that decision will result in a significantly different outcome than if the company had voluntarily disclosed the conduct to us and cooperated in our investigation. In this way, we believe that increased transparency in our FCPA charging decisions should encourage voluntary corporate self-disclosure of overseas bribery, and thus more prosecutions of the individuals responsible for those crimes.
The pilot program describes what we mean by “voluntary self-disclosure,” “full cooperation,” and “remediation.” It also explains the credit available to companies that in fact voluntarily self-disclose FCPA misconduct, fully cooperate with investigations, and remediate. The pilot program builds on the September 9, 2015, Individual Accountability memorandum issued by the Deputy Attorney General.
In short, the guidance provides that if a company chooses not to voluntarily disclose its FCPA misconduct, it may receive limited credit if it later fully cooperates and timely and appropriately remediates – but any such credit will be markedly less than that afforded to companies that do self-disclose wrongdoing. By contrast, when a company not only cooperates and remediates, but also voluntarily self-discloses misconduct, it is eligible for the full range of potential mitigation credit. That means that if a criminal resolution is warranted, the Fraud Section may grant a reduction of up to 50 percent below the low end of the applicable U.S. Sentencing Guidelines fine range, and generally will not require appointment of a monitor. In addition, where those same conditions are met, the Fraud Section’s FCPA Unit will consider a declination of prosecution.
The pilot program is effective today, April 5, 2016. At the end of the one-year pilot period, the Fraud Section will determine whether to extend or modify the program.
The pilot program applies only to FCPA matters brought by the Criminal Division’s Fraud Section. It does not apply to any other Fraud Section matters, to any other Section in the Criminal Division, any other part of the Department of Justice, or any other agency. The precise terms of the pilot program, and additional information about the Justice Department’s Criminal Division, Fraud Section and its enforcement efforts, can be found at www.justice.gov/criminal/fraud.