In an effort to enhance its ability to investigate and prosecute Foreign Corrupt Practices Act (FCPA) cases, the Department of Justice’s (DOJ) Criminal Division has launched a new one-year FCPA pilot program effective April 5, 2016.
The program has three main goals:
- Motivate companies to voluntarily self-disclose FCPA-related misconduct
- Motivate companies to fully cooperate with the Fraud Section, and
- Remediate flaws in companies’ controls and compliance programs, where appropriate.
DOJ appears willing to exchange reduced sanctions during the next year in order to obtain improved opportunity to prosecute individuals.
If successful, the Fraud Unit’s Chief Andrew Weissmann says, “the pilot program will serve to further deter individuals and companies from engaging in FCPA violations in the first place, encourage companies to implement strong anti-corruption compliance programs to prevent and detect FCPA violations, and, consistent with the memorandum of the Deputy Attorney General dated September 9, 2015, increase the Fraud Section’s ability to prosecute individual wrongdoers whose conduct might otherwise have gone undiscovered or been impossible to prove.”
Advantages to a company of the new FCPA Enforcement Plan and Guidance Memo include eligibility for the full range of potential mitigation credit. For example, if 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. On the other hand, 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.
The pilot program applies only to FCPA matters brought by the Criminal Division’s Fraud Section and no other agency or part of the DOJ. At the end of the one-year pilot period, the Fraud Section will determine whether to extend or modify the program. Additional information about the DOJ’s Criminal Division, Fraud Section and its enforcement efforts, can be found at www.justice.gov/criminal/fraud.