Page 87 - U.S. FOREIGN CORRUPT PRACTICES ACT

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

Non-Prosecution Agreements action. 414 Generally, SEC staff considers, among
A non-prosecution agreement is a written other things:
agreement between SEC and a potential cooperating • the seriousness of the conduct and potential
violations;
individual or company, entered into in limited and
• the resources available to SEC staff to pursue
appropriate circumstances, that provides that SEC the investigation;
will not pursue an enforcement action against the • the sufficiency and strength of the evidence;
individual or company if the individual or company • the extent of potential investor harm if an
action is not commenced; and
agrees to, among other things: (1) cooperate
• the age of the conduct underlying the
truthfully and fully in SEC’s investigation and related potential violations.
enforcement actions; and (2) comply, under certain SEC has declined to take enforcement action
circumstances, with express undertakings. If the against both individuals and companies based
agreement is violated, SEC staff retains its ability on the facts and circumstances present in those
to recommend an enforcement action to the matters, where, for example, the conduct was not

Commission against the individual or company. egregious, the company fully cooperated, and the
For further information about non-prosecution company identified and remediated the misconduct
agreements, see SEC’s Enforcement Manual. 413 quickly. SEC Enforcement Division policy is to notify
individuals and entities at the earliest opportunity
Termination Letters and Declinations
when the staff has determined not to recommend
As discussed above, SEC’s decision to bring or
an enforcement action against them to the
decline to bring an enforcement action under the
Commission. This notification takes the form of a
FCPA is made pursuant to the guiding principles set
termination letter.
forth in SEC’s Enforcement Manual. The same factors
In order to protect the privacy rights and other
that apply to SEC staff ’s determination of whether
interests of the uncharged and other potentially
to recommend an enforcement action against an
interested parties, SEC does not provide non-public
individual or entity apply to the decision to close an
information related to closed investigations unless
investigation without recommending enforcement
required by law.

What Are Some Examples of Past Declinations by DOJ and SEC?
As discussed above, under the CEP, DOJ has announced declinations of companies that voluntarily self-disclosed,
fully cooperated and timely and appropriately remediated. Other than those pursuant to the CEP, neither DOJ or SEC
typically publicizes declinations but, to provide some insight into the process, the following are anonymized examples
of matters DOJ and SEC have declined to pursue:

Example 1: Public Company Declination
DOJ and SEC declined to take enforcement action against a public U.S. company. Factors taken into consideration
included:
• The company discovered that its employees had received competitor bid information from a third-
party with connections to the foreign government.
(cont’d)

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