Anti-Corruption Enforcement Developments: 2011 Year-In-Review And 2012 Preview
Mondaq Business Briefing › United States Law Articles in English (2012)
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Anti-Corruption Enforcement Developments: 2011 Year-In-Review And 2012 Preview
I. Introduction
The year 2011 proved to be another busy year for enforcement of the Foreign Corrupt Practices Act ("FCPA"). The US Department of Justice ("DOJ" or "Department") and the US Securities and Exchange Commission ("SEC") continued their vigorous enforcement efforts, initiating a total of 23 and 26 cases, respectively.1 A flurry of activity in December doubled the number of cases brought by DOJ and nearly doubled those brought by the SEC. There were 26 cases brought against companies and 23 cases brought against individuals. Both DOJ and the SEC have made the prosecution of individuals for FCPA violations an enforcement priority, and cases brought in 2011 reflect the continued pursuit of that goal. For example, the year ended with DOJ charging eight former executives and intermediaries of Siemens AG and its subsidiaries and the SEC filing charges against six of the same individuals and settled charges against a seventh former executive; civil charges were also brought by the SEC against three former executives of Magyar Telecom, Plc. The overall enforcement trends persist. In addition to the continued focus on prosecuting individuals, a major portion of the cases continue to involve third-party intermediaries, and substantial financial penalties continue to be imposed. Three of the 11 largest FCPA settlements in history were announced in 2011—the JGC Corporation and Johnson & Johnson cases, both announced in April 2011, took places on the list, and Magyar Telekom and its German parent, Deutsche Telekom AG, just made the list with the December 29 announcement of their settlement. As described in our Anti-Corruption Enforcement Developments: 2010 Year-in-Review and 2011 Preview, 2010 was a record-breaking year for FCPA enforcement, both in terms of the sheer number of cases initiated—90—and in the penalties extracted—approximately $1.8 billion in financial penalties paid by companies and millions more by individuals. The enforcement activity in 2010 dwarfed that in 2009, which had itself been a record-breaking year. While the pace continues to be brisk, it has noticeably slowed in 2011. The smaller number of cases in comparison to the two prior years, however, should not be interpreted as an indication of a lack of enforcement interest. DOJ has announced that it has more than 150 open FCPA investigations and has signaled it will continue its aggressive prosecution of FCPA violations. In January 2011, in a speech to the Washington Metropolitan Area Corporate Counsel Association, Assistant Attorney General Lanny Breuer said: "[i]n the Criminal Division, we have dramatically increased our enforcement of the Foreign Corrupt Practices Act in r...See the full content of this document
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