DOJ Measures to Increase Pursuit of Individuals Under FCPA

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By Che Odom

June 13 — Federal prosecutors find it challenging to pursue individuals for bribing foreign officials, but that may change with new initiatives by the Justice Department, attorneys told Bloomberg BNA.

In the last several months, the DOJ has announced several new measures under the Foreign Corrupt Practices Act, including an increase of staff dedicated to FCPA cases and a one-year pilot program geared at encouraging companies to voluntarily self-disclose violations in exchange for reduced sanctions (66 CARE, 4/6/16).

“With all of these things, you have to believe there will be an increase in the prosecutions of individuals,” John Kelly, a former federal prosecutor and member of Bass Berry & Sims Plc in Washington, told Bloomberg BNA.

The DOJ's initiatives impact the jobs of federal prosecutors by “formalizing a mindset and process” they must follow, Kelly continued.

Under the policy changes, the DOJ is saying, “We're not going to resolve the corporate case until we've completed the investigation” into individuals, he said. The changes require prosecutors to explain the decision they make when it comes to bringing charges and reaching settlements.

This may lead to more actions against individuals, Kelly said.

Individual FCPA Sanctions Since 2013
High Burden of Proof

Halfway through 2016, the Justice Department has reported one enforcement action against an individual under the FCPA. Last year, it reported 10. There was no DOJ action against individuals under the foreign bribery act in 2014, while four were reported for 2013.

A review by Bloomberg BNA of SEC and DOJ actions shows that bribery involving Venezuela has resulted in the highest amount of sanctions for individuals since 2013.

The FCPA has become more important as more businesses go global.

However, prosecutors run into many challenges in pursuing foreign bribery cases, Kelly said. Among other problems, international actors may not be cooperative, rules vary from country to country and business cultures in other countries can differ greatly from that in the U.S., he said.

Michael Diamant, a corporate attorney and partner at Gibson, Dunn & Crutcher LLP, also told Bloomberg BNA that the DOJ faces a number of challenges in prosecuting an individual for FCPA violations that “are not present in negotiated corporate resolutions.”

The difficulty of prosecuting individuals is due in part to the high burden of proof in criminal cases and lengthy investigations leading to loss of evidence, Diamant said. “The individual's liberty is at stake, so that individual is going to put up a vigorous fight, throwing everything at the prosecution.”

In addition, much of the evidence in FCPA cases is in other countries, which may have very different laws governing the release of information, Diamant said.

Increase ‘Needed.'

Among other new initiatives, the DOJ announced in April that it beefed up its FCPA unit by 50 percent, and that the FBI increased its number of investigators, dedicating three units to FCPA and kleptocracy investigations (66 CARE, 4/6/16).

Increasing the staff was necessary, based on the number and complexity of matters under investigation, Diamant said. The DOJ may be reacting to what it is seeing in its investigations, he said.

“The FCPA had, for a long time, been a sleepy area of the law that is still developing and not as mature as some other areas,” Diamant said, noting that not much was happening in FCPA enforcement until about 10 years ago, when it came to be used much more often.

To contact the reporter on this story: Che Odom in Washington at

To contact the editor responsible for this story: Yin Wilczek at

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