DOJ Promises Robust Anti-Bribery Enforcement Despite Dip in Cases

A senior Justice Department official cautions against reading too much into a decline in the number of corporate Foreign Corrupt Practices Act cases

A senior DOJ official said the department has a robust pipeline of cases and he would expect some significant resolutions in the next year.

The U.S. Justice Department’s enforcement of a key antibribery law appeared to ebb last year, with prosecutors levying fines against only three companies for violations of the Foreign Corrupt Practices Act.

However, a senior Justice Department official is seeking to dispel the notion that prosecutors have taken their foot off the pedal.

“I wouldn’t over read or really read much into the numbers of prosecutions in a given year,” said Nicholas McQuaid, who serves as principal deputy of the department’s criminal division.

“We have what we view as a very robust pipeline,” he said. “I would expect to see some significant resolutions in the next year.”

He spoke during a virtual appearance at a forum on the FCPA hosted Thursday in Houston by the American Conference Institute.

The 1977 foreign bribery statute, which prohibits companies with U.S. ties from paying bribes to foreign public officials to gain a business advantage, has become one of prosecutors’ most prolific tools for driving ethical business practices at multinational companies. Since the early 2000s, an uptick in the law’s enforcement has forced companies to install compliance programs in an effort to prevent their employees from paying bribes.

Cumulative fines imposed on corporations by the Justice Department and the U.S. Securities and Exchange Commission, which also enforces the law, reached new heights in 2019 and 2020. Last year, however, cases dwindled, with the number of corporate FCPA resolutions reaching its lowest point since 2015.

Officials have shrugged off the decline, pointing to a steady stream of cases against individuals, including corporate executives who pay bribes and the intermediaries and foreign officials who take them.

A change in presidential administration also historically affects statistics around FCPA enforcement, legal experts have observed. Political appointees at the Justice Department often push to complete major settlements before their departure, causing a lull after a change in administration as career prosecutors regroup and new supervisors are appointed.

Mr. McQuaid on Thursday said those keeping score should expect to see some new types of cases in the near future. He said prosecutors were diversifying their caseloads by coming up with new investigative techniques and forging relationships with more foreign counterparts. Cases involving FCPA violations now regularly involve bringing coordinated charges with authorities in multiple countries.

“I would expect to see some resolutions from places that are familiar to folks, and also some new ones that people haven’t seen in the past,” Mr. McQuaid said.

Last year, Deputy Attorney General Lisa Monaco, the DOJ’s second-in-command, said corruption and other white-collar crimes would be a priority of the Biden administration, and that the department would add new resources to the criminal division’s fraud section, which investigates FCPA cases.

The announcement came after the White House said it was making anticorruption a central pillar of its national security agenda.

The antigraft campaign could be an uphill battle for the administration despite the success of the Justice Department’s FCPA enforcement program. A survey by the nonprofit group Transparency International released this week suggested that many countries around the world have failed to make meaningful progress addressing corruption within their borders over the last decade.

The Justice Department has increasingly pressured companies to develop more sophisticated compliance systems, including through the use of data and analytics tools. Prosecutors also are using data to find new FCPA cases, Mr. McQuaid said.

“We’re continuing to find ways to use data from across the government to help us identify places to focus [our] energy,” Mr. McQuaid said. “That certainly includes use of those techniques in the FCPA space.”

“You’re going to see resolutions and individual prosecutions that reflect that hard work,” he added.

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