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By Lara Kroop Delamarre
Lara Kroop Delamarre's practice focuses on antitrust, trade regulation, white-collar investigations, and international arbitration. Her extensive civil and criminal antitrust experience has included assisting corporate clients in both cooperative and adversarial roles, as well as investigative and prosecutorial matters. Her international arbitration experience includes both commercial and investor-state arbitration.
White collar investigations and prosecutions, notably those initiated by American authorities, have become increasingly international, reaching far beyond the borders of the U.S. The U.S. Department of Justice (DOJ) has promised that these international investigations and prosecutions will continue to grow as it intensifies its efforts to pursue violations globally. For example, in its April 5, 2016, release of “The Fraud Section’s Foreign Corrupt Practices Act Enforcement Plan and Guidance” document, the DOJ’s Criminal Division said that “an international approach is being taken to combat an international criminal problem. We are sharing leads with our international law enforcement counterparts, and they are sharing them with us.”
The DOJ is more serious than ever in pursuing FCPA violations. It makes clear in its FCPA guidance document that the “Department’s demonstrated commitment to devoting additional resources to FCPA investigations and prosecutions should send a message to wrongdoers that FCPA violations that might have gone uncovered in the past are now more likely to come to light.”
The Criminal Division is not alone in its zealous pursuit of violations. The DOJ’s Antitrust Division has also committed itself to uncover and pursue anti-competitive and cartel activities worldwide with increased resources and growing international cooperation. Last month, the Antitrust Division and the Federal Trade Commission issued updated Antitrust Guidelines for International Enforcement and Cooperation. The Division has also recently reiterated that “[i]nternational enforcement cooperation on cartel investigations remains a top priority for the Division.”
Two significant factors have contributed to the increasingly international nature of white-collar investigations and prosecutions. First, the DOJ has made the global fight against both corruption and antitrust cartels priorities as it reaches far beyond the U.S. to investigate and prosecute foreign companies and foreign nationals. Second, international cooperation on both the anti-corruption and the antitrust fronts has increased dramatically. International authorities have and will continue to cooperate with the DOJ.
The obvious impact of this internationalization is more white-collar investigations and prosecutions. This explosion of white-collar investigations and prosecutions internationally also presents a host of complex cross-border issues that have yet to be addressed and for which there is no clear legal framework. Companies must begin to consider these issues seriously to avoid the pitfalls that could accompany potential future white-collar investigations and prosecutions. In order to prevent, and be prepared to defend, an international investigation or prosecution, corporate counsel need to be mindful of (at least) the following issues.
Perhaps the most important thing a corporate attorney should put on her “To Do” list is to take all reasonable steps to protect the company before the DOJ arrives. The first step to take is to evaluate the company’s existing compliance programs. Are they up to date? Compliance programs should be updated annually to ensure they address new developments in the law and changes in the company.
In today’s global enforcement environment, the policy on paper is only one piece of an effective compliance program. What truly matters is whether all employees across the globe understand, respect and have effective corporate incentives to actually follow compliance policies. A corporation has a responsibility to ensure that it has a compliance program with real teeth. It is in the corporation’s own interest to do so. A compliance program with real consequences for employees is comparable to an insurance policy. No viable business should proceed without one.
When in doubt, and when navigating the complexities of cross-border investigations and prosecutions, in-house counsel should consult expert external counsel early in the process. Expert counsel should ideally have DOJ expertise and cross-border capabilities such as bilingualism and a strong understanding of foreign legal cultures.
Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.
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