Page 62 - U.S. FOREIGN CORRUPT PRACTICES ACT

A Resource Guide to the U.S. Foreign Corrupt Practices Act. Second Edition.

compliance program and internal accounting documents, or informal, such as where the staff
controls; (7) the company’s full remediation, proceeds with the investigation without the use of
including but not limited to terminating the investigative subpoenas.
employment of, and disciplining, employees In determining whether to open an
and contractors involved in misconduct; (8) the investigation and, if so, whether an enforcement

adequacy of remedies such as civil or regulatory action is warranted, SEC staff considers a
enforcement actions, including the company’s number of factors, including: the statutes or rules
resolution with SEC and agreement to pay a civil potentially violated; the egregiousness of the
penalty of $6 million and disgorgement; (9) the potential violation; the potential magnitude of the
company’s agreement to disgorge the full amount violation; whether the potentially harmed group
of its cost savings from the bribery; and (10) the is particularly vulnerable or at risk; whether the

fact that, as a result of the company’s timely conduct is ongoing; whether the conduct can be
voluntary disclosure, DOJ was able to conduct an investigated efficiently and within the statute of
independent investigation and identify individuals limitations period; and whether other authorities,
with culpability for the corporation’s malfeasance. including federal or state agencies or regulators,
might be better suited to investigate the conduct.
What Does SEC Staff Consider SEC staff also may consider whether the case
When Deciding Whether to Open involves a possibly widespread industry practice
an Investigation or Recommend that should be addressed, whether the case
Charges? involves a recidivist, and whether the matter gives

SEC’s Enforcement Manual, published by SEC an opportunity to be visible in a community
SEC’s Enforcement Division and available on SEC’s that might not otherwise be familiar with SEC or
website, 308 sets forth information about how SEC the protections afforded by the securities laws.
conducts investigations, as well as the guiding For more information about the Enforcement
principles that SEC staff considers when determining Division’s procedures concerning investigations,

whether to open or close an investigation and enforcement actions, and cooperation with
whether civil charges are merited. There are other regulators, see the Enforcement Manual at
various ways that potential FCPA violations https://www.sec.gov/divisions/enforce/
come to the attention of SEC staff, including: tips enforcementmanual.pdf.
from informants or whistleblowers; information

developed in other investigations; self-reports Self-Reporting, Cooperation, and
or public disclosures by companies; referrals Remedial Efforts
from other offices or agencies; public sources, While the conduct underlying any FCPA inves-
such as media reports and trade publications; tigation is obviously a fundamental and threshold
and proactive investigative techniques, including consideration in deciding what, if any, action to
risk-based initiatives. Investigations can be take, both DOJ and SEC place a high premium on

formal, such as where SEC has issued a formal self-reporting, along with cooperation and remedial
order of investigation that authorizes its staff to efforts, in determining the appropriate resolution of
issue investigative subpoenas for testimony and FCPA matters.

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