On August 30, 2024, the U.S. Department of State’s Directorate of Defense Trade Controls (“DDTC”) announced the settlement of a record $200 million administrative enforcement action with RTX Corporation—a multinational aerospace and defense conglomerate—for 750 separate violations of the Arms Export Control Act (“AECA”) and accompanying International Traffic in Arms Regulations (“ITAR”). As described in the context of a charging letter released by DDTC, RTX Corporation...

DOJ is pushing hard for voluntary disclosures and urging companies to take advantage  of its Voluntary Disclosure Program.  The carrot is significant — a declination in exchange for cooperation, remediation and disgorgement. We often hear about the benefits of voluntary disclosure involving FCPA case.  But the program extends to other crimes — fraud being a significant area. In a significant fraud case, Proterial Cable America,...

The Securities and Exchange Commission is catching up to DOJ.  Not in enforcement but in transparency.  After years of criticism, the Justice Department has set the gold standard for transparency and providing guidance on enforcement and compliance.  The SEC needs to elevate transparency and offer new guidance to the public and industry.  It is even more important for the SEC to provide guidance given the...

The Justice Department is encouraging companies to voluntarily disclose criminal violations — “Come in and confess” and DOJ offers promises of a declination.  But even a declination comes with a requirement — the company has to pay disgorgement.  DOJ has done everything it can do to incentivize voluntary disclosures — many companies are balancing the pros and cons and often deciding NOT to disclose.  Such...

Compliance lessons are life lessons.  Compliance professionals are, by their nature, optimistic people. They see challenges as new opportunities to strive closer to an ideal.  Compliance professionals live in the shadow of the ideal — some may call it the compliance curse. Like the famous artist curse, compliance professionals suffer from an internal struggle — the obsession with perfection, an effective compliance program, and the...

DOJ’s Antitrust Division has been relatively quiet in prosecuting criminal cartel or bid-rigging cases.  Since 2015, the Antitrust Division’s criminal enforcement has fallen from the billions in penalties each year to the lower hundreds of millions.  Most of this may reflect the end of the large, Japanese auto supplier investigation.  While the Leniency Program was a significant source of enforcement actions, it appears the Program...

On August 15, 2024, the U.S. Department of Commerce’s Office of Export Enforcement (“OEE”) announced the settlement of the latest administrative enforcement action involving TE Connectivity Corporation—a Pennsylvania-based electronics company—and its affiliate, TE Connectivity Hong Kong Limited (collectively, “TE Connectivity”), for their involvement in seventy-nine (79) separate violations of the Export Administration Regulations (“EAR”) arising from a series of unlicensed EAR99 exports made to Entity...

While FCPA enforcement against companies has been relatively quiet this year, despite a strong beginning to the year — the SAP case for $220 million; and the Gunvor case for $661 million — DOJ has been pushing a number of individual cases, some of which appear to be flowing from ongoing corporate investigations.  DOJ is expected to announce a new, large corporate resolution for more...

DOJ is joining the whistleblower reward sweepstakes in a big way.  While the SEC has been grabbing headlines for its whistleblower reward program since 2010, DOJ now wants a piece of the action.  DOJ cited gaps that exist under the SEC, CFTC, FinCEN and IRS whistleblower reward programs. As examples of how the program will work, DOJ cited the $4.3 billion settlement with Binance last...

DOJ is feeling the heat.  Corporate criminal enforcement numbers are down. in fairness, DOJ has been pushing individual criminal enforcement as an effective deterrent to corporate misconduct.  Criminal prosecutions, when done properly, take time. Every federal prosecutors know that you “win” your case at the investigation phase — cutting corners means greater risk of failure.    in recognition of the “success” of federal whistleblower programs,...