3 International Law Updates from the Department of "What Were They Thinking?"

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For your weekend reading pleasure, this just on from the International Department of “What Were They Thinking?” -»

- Telecom Executive Sentenced to 4 Years in Prison for Violations of the Foreign Corrupt Practices Act (Morrison & Foerster):

"Last Wednesday, a United States District Court judge in the Southern District of Florida sentenced the former CEO of Latin Node, a now-defunct Florida-based telecommunication company, to 46 months in prison for paying bribes to Honduran government officials. Three other former executives will be sentenced later this year, bringing to a close the extensive — and expensive — fall-out from events that carry many lessons regarding the FCPA.

The former CEO, like his three other colleagues (the then-CFO, vice president of business development, and the chief commercial officer), pled guilty to arranging bribes to the general manager, an attorney, and a Honduran government representative to the board of directors of Empresa Hondurena de Telecommunicaciones (Hondutel), the Honduran state-owned telecommunications company. The bribes totaled more than $500,000 over a nearly 18 month period, and were laundered through Latin Node subsidiaries in Guatemala and through Honduran accounts that the government officials controlled. Nine months before the bribes began, Latin Node had been named the sole winner of an interconnection agreement with Hondutel, allowing Latin Node to provide long distance service between the two countries. The bribes were paid to retain the interconnection agreement and to continue to do business with Hondutel. In its plea agreement, Latin Node admitted to having paid bribes to Honduran officials and also to Yemeni officials.” Read entire update»

- Collar-bomb Suspect Gives Up Extradition Fight (McNabb Associates):

From McNabb’s September 15 International Extradition Law Daily: “Paul Peters, the investment banker accused of placing a fake bomb around the neck of Sydney schoolgirl Madeleine Pulver, expects to be back in Australia within a week to fight the charges. Mr Peters, 50, appeared in a court in Louisville, Kentucky, early this morning Australian time and waived his right to fight extradition. Dressed in a striped jail uniform and sandals, Mr Peters was asked by US District Court Judge Dave Whalin if he understood the rights he was giving up, if he understood extradition law. He replied “yes, indeed”…Australian police said in US court documents that Mr Peters was accused of breaking into 18-year- old Miss Pulver’s home in the wealthy Sydney suburb of Mosman on August 3 and tethering the fake bomb to her neck as part of an elaborate extortion plot…” Read entire update»

- Bribery Case: Another Example of DOJ’s Intent to Expand Reach of Criminal Law (Ifrah Law):

"The Department of Justice continues to show that, even when Congress places limits on the reach of federal criminal statutes, prosecutors will concoct novel theories to try to evade those limits. The latest example of that trend is in the case of Juthamas Siriwan, former governor of the Tourism Authority of Thailand, and her daughter, Jittsopa Siriwan.

The Siriwan prosecution arises out of the 2009 indictment of movie producer Gerald Green and his wife, Patricia Green, for violations of the Foreign Corrupt Practices Act – the first case ever filed against individuals in the entertainment business under that statute. The Greens were accused of paying $1.8 million to receive nearly $14 million in business from the Thai tourism authority between 2002 and 2007, including a contract to manage the Bangkok International Film Festival. In 2009, a federal jury in Los Angeles convicted the Greens, who were each sentenced to six months in prison plus six months of home confinement…” Read updates»

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Now go behave yourself!

By Joe Palazzolo; I contributed to the story and got a tagline.

U.S. authorities are investigating whether Motorola Solutions Inc. paid bribes to win business in Europe, people familiar with the matter said.

Justice Department and Securities and Exchange Commission officials have asked the company for information over the past two years about transactions in seven European countries, searching for evidence that Motorola Solutions—which makes two-way radios and systems for police, fire and other public-safety organizations—may have violated the Foreign Corrupt Practices Act, these people said. The law bars American companies and their agents from offering bribes to foreign government officials.

A spokesman for Motorola Solutions declined to comment.

The investigation began in 2009 after the company opened its own internal investigation into possible breaches of antibribery laws and alerted U.S. authorities, according to the people familiar with the matter.

The internal probe initially focused on a suspicious transaction in Turkey, but U.S. authorities are concentrating on the company’s dealings in Europe, said one person familiar with the matter. Motorola Solutions hasn’t received a subpoena and has been providing information to the SEC and Justice Department voluntarily, this person said.

A blockbuster New York Times story published this weekend details how the Mexican subsidiary of retail giant Wal-Mart paid $24 million in bribes to Mexican officials — and subsequently top Wal-Mart officials allegedly decided to cover up these offenses.

The details of Wal-Mart’s complicity in bribery are shocking, but there is one important element that the Times did not report.

While Wal-Mart’s largest subsidiary spent millions of dollars systematically bribing Mexican officials, the company back home has been working, through big business groups like the U.S. Chamber of Commerce, to weaken the Foreign Corrupt Practices Act (FCPA), which renders it illegal for corporations to bribe officials in foreign countries.

U.S. authorities are stepping up investigations, including an FBI criminal inquiry, into possible violations by employees of Rupert Murdoch’s media empire of a U.S. law banning corrupt payments to foreign officials such as police, law enforcement and corporate sources said.

The U.S. official said that if any law enforcement action was pursued by U.S. authorities against Murdoch employees, it would most likely relate to FCPA.

If it is found to have violated the FCPA, Murdoch’s News Corp, which has its headquarters in New York, could be fined up to $2 million and barred from U.S. government contracts, and individuals who participated in the bribery could face fines of up to $100,000 and a jail sentence of five years.

Read more: U.S. authorities looking into Murdoch foreign payments

Recap: Wal-Mart executives accused of major cover-up

A case which could damage a huge company’s rep: New allegations of a massive bribery and cover-up, orchestrated by Wal-Mart International to protect Wal-Mart de Mexico executives, surfaced in the New York Times over the weekend. Former executive Sergio Cicero Zapata spent more than 15 hours with Times reporters, detailing his role, and the role of others in the alleged crimes. Worst of all, according to Cicero, former CEO Eduardo Castro-Wright didn’t just know about the payments; he endorsed them. Here’s what happened after that:

  • Sergio Leaves Wal-Mart De Mexico After being passed over for a promotion, Sergio left the company in 2004. In September 2005, he contacted senior Wal-Mart lawyer Maritza Munich to discuss his knowledge of crimes he claimed were authorized by senior-level management.
  • Frantic investigations begin Munich hires Juan Francisco Torres-Landa to debrief Cicero, who reports that the allegations seem genuine. Munich notifies Wal-Mart International, and recommends a full investigation of Wal-Mart de Mexico’s senior management team.  source
"There is reasonable suspicion" of violated laws
  • reaction Wal-Mart then hired the law firm Willkie Farr & Gallagher to conduct an internal probe, but the company ignored their recommendation of a full investigation — instead choosing to let corporate investigations director Joseph Lewis take over.
  • results Unhappy with Lewis’ “law enforcement approach” to the case, management re-wrote investigation procedures. Supervision of the matter was given to top executives (then under investigation) who closed the case, citing a lack of evidence.
  • fallout After years of cover-ups, Wal-Mart International now finds itself in the midst of a huge PR scandal. The company has obtained new legal counsel, but has not announced plans to release any executives named. source
The company’s feeling it from investors
  • 5% decline in the company’s stock on Monday, after the report source

» So what’s next? As of this posting, neither the U.S. Department of Justice or its Mexican counterpart have announced that they’ll be launching investigations of Wal-Mart. If either country does decide to pursue an investigation, analysts and Foreign Corrupt Practices Act experts estimate that the governments’ legal fees could end up much higher than Wal-Mart stands to lose in penalties. We’ll keep you posted as more information becomes available. (Photo by Code Poet)

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Anti-Bribery: Prosecutorial Misconduct, Private Suits, IRS Enforcement, China, Mexico, and Other Updates

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For your reference, a roundup of recent law firm commentary touching upon some of the issues central to the ongoing, global fight against bribery and corruption:

DOJ’s FCPA Trial Record (Michael Volkov)

“The O’Shea case was an unfortunate result. The judge was no friend of DOJ. He has a reputation as an anti-government judge, and he certainly knows that the government cannot appeal a decision to grant a Rule 29 motion for judgment of acquittal. The Lindsey case was an aberration. If the government had disclosed all the evidence it withheld, the government would still have won the case. The judge’s decision to reverse the Lindsey convictions reflects a sloppy and inexperienced approach to the trial. It does not undermine DOJ’s judgment in bringing the criminal case. The evidence was strong and the government should have won the case.” Read more»

Prosecutorial Misconduct: The Risks Inherent in Criminal Discovery (Duane Morris LLP)

“On Dec. 1, 2011, a California federal judge overturned a conviction in the first Foreign Corrupt Practices Act case against a corporation to proceed to a jury trial, citing ‘flagrant’ prosecutorial misconduct where the government: (i) failed to turn over Brady evidence, (ii) obtained a search warrant with an application that contained false and misleading information, and (iii) intercepted a defendant’s confidential communications with her attorney. The combined weight of these disparate acts of misconduct drove the court’s decision and is an object lesson both for government lawyers and the defense bar.” Read more»

Anti-bribery Enforcement with Chinese Characteristics: Not All Official (K&L Gates LLP)

“In 2012, expect to see the global trend of increasing anti-corruption enforcement persist as regulators around the world continue to show zeal in enforcing anticorruption laws. This is not to say, however, that anti-corruption enforcement will pose the same types of risk in different jurisdictions across the globe. In fact, understanding the differences in the kinds of bribery and corruption subject to stricter enforcement vigilance will be critical to formulating effective compliance strategies to mitigate risks on the ground in key markets.” Read more»

Off to the Races in 2012: DOJ’s Fast Start in FCPA Enforcement (Michael Volkov)

“Talk about seeing the forest from the trees – during the same week that Judge Hughes granted the defense motion for judgment of acquittal in the O’Shea case, the Justice Department announced a $56 million settlement in the Marubeni case, and Biomet disclosed it was planning on an FCPA settlement in the $30 million range. Late last year, two major companies announced they were close to significant criminal settlements in major cases. The number one trend/prediction for 2012 looks like it is coming to fruition – DOJ is back to collecting major criminal fines from corporations. It looks like the Justice Department is off to a fast start.” Read more»

Another Nigerian Bribery Scandal Settlement and the NL MVP Award (Thomas Fox)

“… there is a new entry into the Nigerian-Bonney Island Bribery Scandal. That entrant is the Japanese trading company, Marubeni Corporation, which the Department of Justice announced it had settled an enforcement action with this past week. As reported by the FCPA Professor, Marubeni was retained by the joint venture, TSKJ, ‘to help it obtain and retain business in Nigeria, including by offering to pay and paying bribes to Nigerian government officials.’” Read more»

Private Suits Under FCPA — An Ill-Advised Idea (Ifrah Law - Strategic Defense in Federal Investigations)

“The FCPA prohibits bribing foreign government officials. The proposed bill would amend the statute to allow for private lawsuits against foreign concerns for alleged violations of the statute’s anti-bribery provisions. These lawsuits could be brought by (1) any issuer, defined as an entity that issues securities under U.S. securities laws and its employees; (2) any domestic concern, defined as any U.S. citizen, national, or resident, or any business that is principally located in the U.S. or incorporated in the U.S.; or (3) any other United States person, defined as any person or business entity other than an issuer or a domestic concern.” Read more»

Proposed Bill to Allow Private Enforcement of the FCPA (Patterson Belknap Webb & Tyler LLP)

“Despite its limited scope, H.R. 3531 could potentially lead to a substantial increase in private litigation. The treble damages provision gives domestic parties a strong incentive to bring actions against competing foreign concerns, particularly in situations where the domestic party has been unable to compete in international markets due to uneven enforcement of antibribery prohibitions. In addition, although the requirement that the violation be committed in United States territory might limit the availability of such suits, recent government enforcement actions under § 78dd-3 suggest that minimal acts in United States territory might be sufficient to ground jurisdiction.” Read more»

Prosecution of Foreign Companies and Foreign Individuals (Michael Volkov)

“One of the more interesting trends in FCPA enforcement is the DOJ’s willingness to prosecute foreign companies and individuals. Some may argue that DOJ needs to focus on US companies which engage in foreign bribery and leave the prosecution of foreign companies to foreign prosecutors in their respective countries. Foreign companies become even more concerned when it comes to the prosecution of foreign officers and employees who are required to serve prison time in US jails.” Read more»

The Mañana Syndrome? (Matteson Ellis)

“Mexico recently received a poor bill of health with respect to fighting foreign bribery. A recent OECD Working Group report assessed the implementation of Mexico’s commitments under the OECD Anti-Bribery Convention and highlighted ‘deficiencies’ and ‘shortcomings’ in implementing the Convention’s requirements. While it acknowledged ‘some improvements to [Mexico’s] legislative framework for fighting bribery’ and Mexico’s ‘efforts to promote awareness, prevention and detection of foreign bribery within the private sector,’ it paints overall a picture of delay.” Read more»

IRS Joins FCPA Enforcement (Thomas Fox)

“So what does the IRS bring to a FCPA investigation? Edmonds stated that the IRS has skills and experience in looking at financial patterns and tracing money. He noted that usually FCPA violations are tied to other legal violations, for example money-laundering or fraud, and that the IRS can comb through financial records to find patterns in payments. He also stated that the IRS has significant experience in investigating corporate shell structures which can be part of an ongoing criminal attempt to obtain bribes and then conceal the location of the money.” Read more»

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Related Commentary and Analysis:

Don’t Expect Too Much From DOJ’S Upcoming “New FCPA Guidance” (Sheppard Mullin Richter & Hampton LLP)

“After the last few years of extremely aggressive DOJ prosecutions under the Foreign Corrupt Practices Act, white collar practitioners and the business community generally can be forgiven if they saw a ray of hope in the recent comments of Lanny Breuer, the head of DOJ’s criminal division. Breuer, speaking at a November 2011 FCPA conference in Washington, announced that in 2012, DOJ would be releasing ‘detailed new guidance’ on criminal and civil FCPA enforcement. The chairman of the conference characterized Breuer’s announcement as a ‘big step’ that was ‘pretty significant.’” Read more»

Third Party Checkup (Thomas Fox)

“In a recent White Paper … Marjorie Doyle and Diana Lutz posit that in most foreign business partner relationships, your company will be held responsible for the actions of third parties which work for and with your company. The new global expectation is that ‘you know who they are, you have vetted them and you are in control of the activities for which you hired them.’ They further believe that such is even more important when anti-corruption and anti-bribery laws, such as the Foreign Corrupt Practices Act, UK Bribery Act or other OECD based legislation, are applicable.” Read more»

Risky Business: The Unexpectedly Broad Application of the FCPA’s “Business Purpose” Element (Matteson Ellis)

“Companies and individuals subject to the U.S. Foreign Corrupt Practices Act often misunderstand the scope of subject activity. They assume that bribes are illegal only if they relate to a company’s core business. As a result, they might focus anti-corruption compliance efforts in areas like public procurement. But they might not think it necessary to do so in other areas of their business, like managing tax liabilities or setting up business registrations in new markets. By ignoring these areas, they expose themselves to important risk.” Read more»

Conduit to Compliance or First Line of Defense – the Local Compliance Point Person (Thomas Fox)

“As compliance programs mature, it is becoming increasing clear that one size does not fit all. Moreover, there may be several different approaches to creating the most effective compliance program for your organization. This past week I attended the ACI FCPA Boot Camp in Houston. Many of the presentations dealt programs, procedures and process companies had developed specifically for the compliance issues they have faced around the globe. One of these was in a session entitled “Compliance Programs 2.0” where one of the subjects discussed was who to embed as a local compliance representative in an international business unit.” Read more»

No Strings Attached: The Latest Expansion of the Lacey Act (Sheppard Mullin Richter & Hampton LLP)

“Importers of plants and plant products have good reason to be concerned about running afoul of the Lacey Act given the uncertainty created by 2008 amendments making violations of foreign law regarding plants a basis for violations under the Act. The recent saga of the Gibson Guitar Corp., maker of the iconic Les Paul guitar, has only confirmed that such concern is well-founded. As Gibson’s case exemplifies, the Department of Justice can disagree with foreign officials to rely on its own interpretation of foreign law to seize and seek forfeiture of goods, and even bring criminal charges.” Read more»

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Long a quiet funder of right-wing political causes and a just-as-long bugaboo of the activist left, Koch Industries Inc. is now the focus of media allegations about foreign bribery and doing business with the pariah state of Iran.

A wide-ranging report published Sunday night by Bloomberg Markets magazine details a battery of alleged misconduct by the Wichita, Kan.-based Koch, which is one of the world’s largest privately held companies. The company and its owners are secretive and protective of their image; sources leaked some of the story in pre-buttals before the Bloomberg report was published.

Among the most notable revelations from the Bloomberg story are its claims that a French subsidiary allegedly paid bribes to win contracts in six countries, and that a European unit sold millions of dollars of petro-equipment to Iran, with sales continuing until 2007.

Interesting article on how the payments to British police made by News Corp would be in effect violation of FCPA statutes. As the article reminds the readers, the Act generally prohibits American companies and citizens from corruptly paying – or offering to pay – foreign officials to obtain or retain business.

Though the connection between the heir apparent (which is becoming less likely every day) James Murdoch and the actual payments is tenuous at best, any investigation would be pretty severe in terms of the publicity. It would also impact the recent bid to buyout the remainder of Sky BsB by the holding company.

It is going to be interesting if the DoJ delays initiation of an investigation given the actions noted to date. It is going to be interesting how the Murdoch properties in the US provide coverage of the ongoing trials and tribulations. And summers in Europe are idyllic? Pssh…

America's Bosses

America has to answer to people.  Not the people that hate us and are watching our every move, or the loudmouth liberals that shove their views down our throats, but we have a real obligation to abide by the rules of other entities not of our country.  We did not vote for these, nor do we benefit; in fact, rarely is it in our interest to follow the guidelines of their policies.  We have global organizations that tell us what we can and can not do. Sounds like a conspiracy theory about the global enslavement by the elite, unfortunately it is less intriguing and even worse.

We have a big issue with China pegging their currency, they do not allow their currency to float like the rest of the world. This is a violation.  A violation to whom, you may ask.  The World Trade Organization, the same organization that prevents us from raising tariffs on not only on China, but on every other country as well.  Why are we a member of such an organization?  Excellent question, we shouldn’t be.  America, and China, should be able to act in the best interest of our country with out having to answer for our decisions.  In fact there are many others as well: IMF, UN, G8, NATO, and even NAFTA, just to name a few.  I am not saying these are all bad,  I happen to be a fan of NAFTA, but a simple fact remains: supranational institutions reduce autonomy of national governments.

If the U.S. Government wants to contract Boeing to manufacture military jets, they should have every right to do so without worrying about EADS and AirBus (Boeing’s European competition) going to the WTO about our government paying Boeing to produce their 777 to the world at a lower price.  Why should we care what a European company says about our military contracts?  Yet, we do. We do because the WTO will come down on us with fees, trade penalties, and other legal action.  The fact that China pegs their currency is nobody’s business but China and their trading partners. If we would like to raise tariffs or supplement the manufacture of jumbo jets, that is only between us and our partners, or Boeing and their customers.  If a country like China wants to sell a product here for less money than it costs to produce, which is called dumping, it is up to our government to step in and create the necessary disincentives to combat that issue. Our entire federal government used to be paid in full by these fees before Woodrow Wilson introduced Income Tax.  (Just imagine how efficient our country ran then.) We have import quotas, and other mechanisms, we used on the Japanese car companies in the eighties.  Not that I am for all of these, but we should all agree trade should be fair.

Free trade is great, but what we have is not free trade, what we have is a half-formed mutant, Quasimodo version of it; and the fact that we belong to these organizations limits our ability to deal with it.  Strangely, as the leader of the free world, we have given up much of our sovereignty.  We have enough limitations to our ability to conduct business fairly and remain competitive around the globe with self imposed limitations: enter the Foreign Corrupt Practices Act.  No other country does as much to restrain domestic companies to give the rest of the world a shot.  We have more unilateral trade agreements (i.e. we give you a break because your economy is small and insignificant) than any other country on the globe. That is great as long as we are the ones calling the shots.  It is time for our leaders to do what is best for our country, not what is best for Zimbabwe.  The WTO does not own us, and we should not let them govern our trade policies.  How can we vote them out?

Corruption Roundup: FCPA Enforcement, Japan and Nigeria Bribery, Govt Investigations...

For your Monday morning reading pleasure, three quick links to corruption and compliance-related advisories recently published on JD Supra:

- The Expansive Reach of the FCPA Extends to Japan Again: A Second Japanese Company Resolves FCPA Charges Related to a Nigerian Bribery Scandal

From Morrison & Foerster: “The Marubeni case stems from a scheme by a four-company, multinational joint venture to bribe Nigerian officials in exchange for contracts to build liquefied natural gas facilities on Bonny Island, Nigeria. The criminal information filed by the DOJ accuses Marubeni of being an agent through which bribes were paid. The members of the joint venture were Technip S.A.; Snamprogetti Netherlands, B.V.; Kellogg Brown & Root Inc. (“KBR”) (a Halliburton subsidiary); and JGC Corporation…” Read on»

- Aggressive FCPA Enforcement Persists: Increased Activity, Along With Recent Legal Developments, Mandate that Companies Remain Vigilant

From Sheppard Mullin: “The government has also signaled that it can and will use aggressive law enforcement techniques to enforce the FCPA. On Jan. 19, 2010, the FBI conducted a now-infamous raid on a trade show in Las Vegas, arresting 21 individuals. The raid followed an undercover sting operation in which FBI agents posed as officials from an African country and solicited bribes from the defendants in exchange for lucrative defense contracts. This was the first time the government had used an undercover sting to enforce the FCPA…” Read on»

- Top Ten Action Steps When the Government Shows Up at Your Door

By Michael Volkov and Justin Connor: “Every step in a government investigation should be seen as an opportunity for in-house counsel to learn about the investigation and the government’s case – who is the government focused on?  What conduct is under investigation?  What type of evidence is the government looking for during the search?  Who is the government interested in interviewing?  What does the government already know?” Read on»

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Follow: Criminal Law updates on JD Supra.

A major union found a new venue to defend workers of the world: The U.S. legal system.

The United Steelworkers sent a letter to the U.S. Justice Department requesting a foreign-bribery investigation into Freeport-McMoRan Copper & Gold Inc. Citing reports in the Indonesian media, the union argued that payments to police from Phoenix, Ariz.-based Freeport-McMoRan’s local subsidiary in the Indonesian province of Papua constitute bribes.

“We believe that it is reasonable to construe direct payments by PT Freeport Indonesia to police and military personnel providing security for its operation…as a bribe intended to persuade the personnel to act in defense of Freeport-McMoRan’s interests even when those interests conflict with the police and military personnel’s lawful duty to protect Indonesian people,” the letter said (pdf).

The Chamber of Commerce is using misleading rhetoric to promote legislation that would shield businesses from punishment for bribery. Rep. Jim Sensenbrenner (R-WI) pledged to introduce a bill “reforming” the decades-old Foreign Corrupt Practices Act (FCPA) following a Judiciary Subcommittee hearing on the FCPA. The push for reform is fueled by the Chamber of Commerce’s arguments that FCPA enforcement by both the Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) is unprecedented and arbitrary. The Chamber claims that FCPA enforcement has been costly to business, which is in line with the Chamber’s trite strategy of labeling just about every business regulation as a “jobs-killer.”

It takes pretty massive balls to ask tell regulators to cool it and allow just a bit more corruption in your business practices.

Any of you out there who enjoy busting unions: bust up this one first. The Chamber of Commerce may not fit the classic image of a union, but it is a union nonetheless - a depraved collective of businessmen and wannabe ubermensch.

3 Compliance Takeaways from Aon’s $16.3 Million FCPA Settlement

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In late December 2011, insurance broker Aon Corporation agreed to pay $16.3 million to the Department of Justice and the Securities and Exchange Commission to settle charges of Foreign Corrupt Practices Act violations in connection with payments its UK subsidiary made on behalf of government officials in Costa Rica and other countries. Aon’s subsidiary had set up a travel and education fund for the officials, but “failed to maintain an adequate internal control system reasonably designed to detect and prevent improper payments,” which led to the use of the fund for personal entertainment expenses of the government employees. 

For your reference, here are three FCPA takeaways from the Aon story:

1. There is no excuse for poor documentation: 

“There must be a clear and DOCUMENTED business purpose in travel and payment of educational expenses. Remember the three most important things are DOCUMENT, DOCUMENT and DOCUMENT. Beyond that your books and records need to reflect accurate payments for travel, as in who, what, when, where and how; not ‘various airfare and hotels.’” (Aon Nets an NPA by Thomas Fox) 

2. If it looks like a vacation, it probably is:

“The SEC noted that a ‘substantial number’ of the ‘purported educational conferences’ were in ‘attractive tourist destinations,’ such as London, Paris, Monte Carlo, Zurich, Munich, Cologne, and Cairo, and ‘had no discernible purpose’ or had no apparent connection to the insurance industry. The expenses included literary conferences, holiday expenses, pure entertainment or extensive leisure activities, and family-related travel.” (2011 Ends With Over $100 Million in Penalties and Disgorgements for FCPA Violations at Insurance Company and Telecom Company by Morrison & Foerster LLP) 

3. It is your responsibility to know where the line is, and not to cross it: 

“Trainings are standard in the [insurance] industry and have a legitimate business purpose. Brokers need to teach their clients about the complicated products they sell so that clients can make sound decisions based on their particular needs… But at some point, a training becomes a bribe under the FCPA and other international anti-corruption laws.” (The Aon Case: Lessons from the Latest FCPA Action Involving the Americas by Matteson Ellis)

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Halliburton Co. said it’s conducting an internal probe of some of its operations in Angola pertaining to possible violations of U.S. bribery law.

The investigation, disclosed in a filing Friday with the Securities and Exchange Commission, began in December when the Houston-based company received an anonymous email alleging that “current and former personnel” possibly violated the company code of conduct and the Foreign Corrupt Practices Act through an Angolan vendor. The email further alleges “conflicts of interest, self-dealing and the failure to act on alleged violations of our [code of conduct] and the FCPA,” the filing said.

Tara Mullee, a company spokeswoman, wrote in an email Sunday evening that the company views its code of conduct as a guide to “apply legal and ethical principles to our work.”

"Halliburton takes all [code of conduct] reports and allegations of code violations very seriously," she wrote.

The UK Bribery Act came into force on July 1, the same day this article appeared. In summary it appears that 1) the British intend to crack down VERY hard on corruption, consistent with what we have been hearing in America re the FCPA 2) the British are further claiming legal jurisdiction over any company with anything to do with the UK, for example a Russian company with a London listing, or a German company with a one man office in London, or (and this is controversial and to be tested) any company with a British citizen as an employee.

If a company bribes a Russian official, whether a Russian company or not, and there is SOMETHING linking that company to the UK (that may have nothing to do with the alleged bribe), the British courts are claiming jurisdiction, as are the American courts.

The consequences are mind boggling and potentially crippling. Bribe allegations are easy to make, if hard to prove. Companies all over the world could be worn down by massive amounts of litigation.

This is very big and all companies in Russia, both domestic and international, need to to know about it.

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