Yesterday the U.S. Department of Justice (“DOJ”) announced a non-prosecution agreement (“NPA”) with a Hong Kong-based subsidiary of Credit Suisse Group AG arising out of the so-called “princelings” scandals of recent years—the practice of hiring unqualified, but politically-connected, relatives of Chinese officials to garner business from state-owned firms. Per Credit Suisse’s admissions, “bankers discussed and approved the hiring of close friends and family of Chinese officials in order to secure business,” resulting in $46 million “in profits from business mandates with Chinese” state-owned enterprises. As part of the resolution, Credit Suisse agreed to a $47 million criminal penalty, to continue to cooperate with DOJ, and to enhance its compliance program, including adopting additional controls around hiring. In addition, Credit Suisse agreed to pay nearly $25 million in disgorgement and $4.8 million in prejudgment interest to the Securities and Exchange Commission (“SEC”). In its press release, DOJ stated that it was giving Credit Suisse a 15 percent discount from the bottom end of the U.S. Sentencing Guidelines for its cooperation in the investigation, while also (as discussed more below) noting steps the firm did not take that worked to limit the amount of such cooperation credit. While this is hardly the first of the “princelings” cases, it does demonstrate DOJ’s continued commitment to the cooperation framework it laid out in its FCPA Corporate Enforcement Policy (“Enforcement Policy”) late last year.
Jennifer Kennedy Park’s practice focuses on white-collar defense, enforcement actions and complex civil litigation.
On May 9, Deputy Attorney General Rod J. Rosenstein provided remarks at the American Conference Institute’s 20th Anniversary New York Conference on the Foreign Corrupt Practices Act and announced a new policy designed to promote coordination and limit the imposition of multiple penalties on a company for the same conduct, which he referred to as “piling on.”
This memorandum highlights some of the most salient points from Rosenstein’s remarks, and describes the key elements of the new policy, with an eye towards potential implications for enforcement actions going forward.
On April 23rd, the European Commission adopted a proposal for a directive on the protection of whistleblowers reporting breaches of Union Law.
The proposal sets out minimum standards of protection for whistleblowers against retaliation when they report breaches in specific policy areas. The proposal is premised on the view that the lack of a common, effective approach to whistleblower protection across Member States can impair the enforcement of European law. Continue Reading The European Commission Proposes new Rules to Strengthen Whistleblower Protection
On March 27, 2018, the Canadian Government announced the introduction of legislative amendments to bring deferred prosecution agreements (“DPA”) to Canada. The legislation, which would create the “Remediation Agreement Regime” (“RAR”), follows a global trend. In recent years, DPA regimes have been introduced in the U.K. and France, and considered in a variety of other common law jurisdictions including Singapore and Australia. Although broadly patterned on an approach pioneered in the United States, like the statutory enactments in other countries adopted more recently, the Canadian RAR regime is likely to be considerably more structured and involve much more substantive judicial supervision. Continue Reading Canada Proposes New Deferred Prosecution Agreement Program
Earlier this month, partners Jennifer Kennedy Park and Kimberly Spoerri participated in a panel co-hosted by The Conference Board and Cleary Gottlieb to discuss the board’s oversight role in issues related to sexual harassment.
Moderator Doug Chia, executive director of The Conference Board, Jen and Kim discussed relevant legal regulations and frameworks and the risks of non-compliance, as well as the policies, procedures and best practices boards and senior management can employ to mitigate risks. They discussed the responsibility the board has in setting company culture through tone at the top, and how the failure by the board and senior management to be proactive in this area can affect compliance and oversight throughout a company. The discussion also included ways the board can tangibly address these issues. Continue Reading Cleary Partners Participate in Panel Discussion on Board Oversight of Sexual Harassment
Within the past few months, the Department of Justice (the “DOJ”) has released a series of memos that indicate a shift in its policy related to the treatment of agency guidance documents. This memorandum seeks to explain this policy shift and analyze its potential impact in the area of False Claims Act (“FCA”) enforcement. Continue Reading Shift in Policy on Guidance Documents Suggests Change in DOJ Attitude Towards FCA Enforcement
2017 was a year of transition and change in the world of cross-border investigations. In the U.S., the first year of the Trump administration brought questions about enforcement priorities and approach. In the U.K., the debate continued over whether lawyers’ work in furtherance of internal investigations enjoys privilege protection. Globally, new enforcement authorities stepped forward, while companies worked to incorporate new guidance and enforcement priorities into their corporate compliance programs.
Looking back, we focus on five key themes from 2017:
a) corporate resolutions;
b) developments in legal privilege;
c) corporate responsibility;
d) cross-border inter-agency cooperation; and
e) cross-border data transfers.
We also look to the future to address what we consider to be some of the key characteristics of the current cross-border investigations landscape that may influence significant developments in this field in 2018.
Please click here to read the full alert memorandum.
In recent months, sexual harassment allegations against well-known figures across a growing number of industries have become a common feature in news headlines. In the wake of these allegations, many companies have concluded that their current policies and procedures related to sexual harassment and discrimination are inadequate. Against the backdrop of this rapidly evolving landscape, companies are considering how to improve their policies and procedures not only to appropriately and effectively respond to allegations of sexual harassment, but also to deter inappropriate behavior going forward and foster an environment of openness, diversity and inclusion in their workplaces. To that end, we address 8 key questions that companies should be asking themselves in developing policies and procedures to confront sexual harassment and other forms of misconduct in today’s workplace.
Click here, to read the full memo
In a September 25, 2017 speech in New York, U.S. Commodity Futures Trading Commission (the “CFTC”) Division of Enforcement (the “Division”) Director James McDonald outlined the CFTC’s focus on creating greater incentives for self-reporting and cooperation in order to deter and detect misconduct in the commodities markets. Director McDonald’s speech accompanied the release of an Updated Advisory on Self Reporting and Full Cooperation, which supplements the guidance issued by the CFTC earlier this year.
The new guidance reflects an effort by the CFTC to rebalance the incentives facing firms who identify potential misconduct to favor voluntary reporting and pro-active cooperation, reinforced by the potential for concrete benefits in the form of fine reductions and, potentially, declination of prosecution in appropriate cases. Commodities market participants and financial institutions should take note of this guidance when considering how to respond to potential evidence of misconduct and in dealing with the Division.
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