Anti-Corruption Enforcement 2022
Year in Review

Perspective from the United States

In last year’s Anti-Corruption Guide, we anticipated an uptick in US anti-corruption enforcement in 2022, due in part to waning impacts of the COVID-19 pandemic and the announced priorities of President Biden’s US Department of Justice (DOJ) and Securities and Exchange Commission (SEC) nominees. In the last 12 months, the Biden administration has since implemented additional policies, brought a series of enforcement actions, and announced negotiated resolutions. The results have been a mixed bag. In total, the number of Foreign Corrupt Practices Act (FCPA) enforcement actions in 2022 increased from 2020 and 2021 but was still lower than the number of actions brought in 2019. Federal prosecutions for domestic corruption offenses also were down across the US. The numbers suggest that the administration has yet to see the benefits of its aggressive campaign against corruption and that it is still attempting to gain its stride post-pandemic, as borders and courts re-open and domestic and international enforcement agencies work through pandemic-related backlogs.[1]

On the policy front, in 2022, the Biden administration announced two important updates to enforcement of federal criminal laws against corporations in separate speeches by DOJ Deputy Attorney General (DAG) Lisa Monaco. In an April 2022 speech, DAG Monaco previewed a potential shift in enforcement priorities when she explained that sanctions evasions and export control violations were key for combating corporate crime – she further described the misconduct as “the new FCPA.”[2] Later in 2022, DAG Monaco provided guidance about DOJ’s FCPA Corporate Enforcement Policy (CEP), which is the department’s policy aimed at promoting corporate FCPA investigations and individual accountability for violations. In her speech and the accompanying memo, DAG Monaco emphasized that corporations must disclose pertinent information on a timely basis and that they should prioritize producing evidence that is more relevant for evaluating individual liability.[3]

The updated CEP also provided guidance regarding independent monitors. In 2022, the Biden administration described a potential increase in using independent compliance monitors, and in remarks in September 2022, DAG Monaco explained how prosecutors will evaluate the need for independent compliance monitors. Specifically, DAG Monaco stated that DOJ will review the need on a case-by-case basis, and it will not require the imposition of a monitor when corporations have self-disclosed relevant conduct and have implemented effective compliance programs.[4]

In terms of individual accountability, DOJ pursued cases against government officials and company executives that were responsible for committing corruption-related crimes. DOJ’s prosecution of individuals included executives from domestic companies, such as a coal company executive,[5] and international actors like South American prosecutors[6] and an international investment banker.[7]

Although under new leadership, the SEC continued to focus its efforts on identifying and bringing new cases for payments and/or gifts under the anti-bribery, books and records, and internal accounting controls provisions of the FCPA. Even though the SEC brought fewer FCPA enforcement actions compared to prior years, the settlements that the commission entered with companies demonstrated its focus on cooperation when deciding how to resolve investigations. In the seven corporate cases the SEC pursued this year, the alleged misconduct spanned the globe and included allegations in Africa, Asia, Europe, and South America. In terms of policy updates, the SEC amended its whistleblower program, which was established under the Dodd-Frank Act to allow whistleblowers to receive percentages of the ultimate recovery from any SEC action taken in response to or in conjunction with the information provided. Under the new rule, the SEC is now permitted to pay a whistleblower an award for a related enforcement action brought by another regulator if the other regulator’s award program would be a smaller award.

US courts also issued decisions that will likely impact FCPA investigations moving forward. First, in United States v. De Leon-Perez,[8] a district court in the Southern District of Texas provided more clarity about how the statute of limitations is tolled when the government uses Mutual Legal Assistance Treaties (MLATs) and provided guidance about how the federal government can properly use the evidence collection tool in the future. In another decision, United States v. Hoskins,[9] the Second Circuit addressed yet again who may be considered an “agent” of a “domestic concern” under the FCPA. The decision, which brought final conclusion to the long-enduring Hoskins matter, reiterated that the traditional agency principles apply when asserting jurisdiction over foreign accessories who are not expressly within the categories of persons enumerated in the FCPA.

Perspective from the United Kingdom

The UK introduced a number of legislative reforms designed to step up the fight against corruption. These include the Economic Crime (Transparency and Enforcement) Act 2022, which the UK intends to use to clamp down on the flow into the UK of assets derived from criminal conduct, in particular corruption. Amongst other things, the act requires non-UK companies holding an interest in UK real estate to provide information regarding their ownership to the UK authorities. A further piece of proposed legislation, expected to become law in 2023 – the Economic Crime and Corporate Transparency Bill – includes reforms to the UK's corporate registration procedures to improve transparency and address the abuse of the UK financial system by criminals. It has also been reported that the UK government is contemplating adding a provision to the bill that would introduce a lower threshold for corporate criminal liability in respect of fraud.

The threshold for corporate criminal liability in the UK has been the subject of much discussion in recent years with persistent calls for reform. Law enforcement authorities and non-governmental organizations (NGOs) in particular feel that the current threshold – which requires prosecutors to demonstrate misconduct by senior executives in the company – is too high and prevents companies from being held to account for their wrongdoing. In June 2022, the Law Commission published a paper setting out options for reform. These include the introduction of more offences – like the corporate offence in the UK Bribery Act – that would make companies liable for failure to prevent misconduct by any person associated with the company. Companies charged with these offences would be able to point in their defence to their compliance programmes and procedures to prevent misconduct. Whilst the UK government is not bound to adopt the Law Commission’s proposals, we anticipate they will be given serious consideration and reforms may follow at some point in the future.

The UK has also seen a number of enforcement actions in 2022. Glencore Energy UK Ltd. pleaded guilty in June 2022 to bribery offences in connection with its oil business in West Africa and was sentenced to a total penalty of approximately £281 million. The case represents the first prosecution of a company for the substantive offences of paying bribes and the third prosecution for the corporate offence of failing to prevent bribery. Separately, various other individuals were also prosecuted – and convicted – in the course of the year for bribery and fraud offences in connection with investigations into other companies. However, the UK’s Serious Fraud Office (SFO) has come under the spotlight following the overturning of convictions in the Unaoil investigation and disclosure failings relating to the prosecution of individuals in connection with a recent deferred prosecution agreement (DPA). Two independent reviews revealed a lack of resourcing and a culture of distrust at the agency. As current Director Lisa Osofsky prepares to step down in 2023, all eyes will be on the SFO to see whether it can bolster its reputation in the coming years.

The 2022 Anti-Corruption Guide

This 2022 guide analyzes these and other significant developments in anti-corruption laws and practice. The guide’s appendices offer an overview of the FCPA and the UK Bribery Act (UKBA) and answer questions that may be pertinent to companies operating in the international marketplace. The information presented here is not legal advice.

Jenner & Block’s Anti-Corruption and FCPA Practice Group

Jenner & Block’s Anti-Corruption and FCPA Practice Group includes numerous lawyers with deep experience involving the FCPA, the UKBA, and other international anti-corruption laws. In 2022, we provided our clients compliance counseling, conducted internal investigations, and defended individuals and corporations.

Our team includes senior alumni of DOJ, SFO, and SEC. Several of our partners during their time in DOJ led, created, and implemented key policies affecting anti-corruption enforcement. For instance, one partner was the most senior career official in DOJ’s Criminal Division, supervising the Fraud Section, which institutes or oversees every FCPA investigation and prosecution brought by DOJ. Another ran the criminal division and the public corruption section of the US Attorney’s Office, where he created and implemented anti-corruption priorities and policies. Another partner was a senior prosecutor leading multiple, high-profile investigations and prosecutions brought by the SFO.

If you have any questions or would like to discuss any of the topics covered in the guide, we would be delighted to hear from you; please contact any member of the Anti-Corruption and FCPA Practice Group.

Footnotes