Tagged: SEC

Five Key Takeaways from Key Energy’s SEC FCPA Settlement

The SEC, last week, announced its $5 million settlement with Key Energy. As always, FCPA settlements contain important examples of enforcement priorities and policies. Key Energy’s recent settlement is an example of the benefits of cooperation, especially when a company, like Key Energy, did not initiate the investigation by disclosing the matter to the government. Key Energy agreed to a books and records and internal...

FCPA Compliance: Does “Anything of Value” Really Mean “Anything of Value”?

The FCPA statute is not as vague as some contend. I remember the words of a former FTC Chairperson who told me once – “The Clayton Act is not vague. I just read the law and apply it to the facts.” Not to be too simplistic, I recognize there are legitimate disputes surrounding application of the FCPA to specific situations. As one example, I have...

Headlines from Mid-Year FCPA Enforcement Review

Just to add my voice to the cottage industry surrounding FCPA enforcement and compliance, I wanted to take a deep breath and offer some observations on FCPA enforcement in 2016. There are a few significant headlines for the year so far, and I suspect more to come as we get close to the end of the year when FCPA enforcement usually picks up a little...

DOJ and SEC Collect $22 Million from LAN Airlines for Conduct in Resolving Labor Dispute

Last week, the Justice Department (here) and the SEC (here) announced parallel FCPA settlements totaling $22 million in fines, penalties and disgorgement against LAN Airlines, a Chile-based airline, for conduct in resolving a labor dispute in Argentina. In March 2016, the SEC settled a case with LAN’s CEO for approving payments to a consultant, an advisor to the Secretary of Argentina’s Ministry of Transportation, to...

The Importance of Risk Ranking to Compliance

We all face a number of risks every day. Yet, we do not respond to each and every risk. We engage in risk-ranking our responses. Some are more risk than others and some are more catastrophic than others. So, we engage in risk ranking each day and allocate our time and attention accordingly. The same applies, or should apply, when managing a compliance program. Resources...

Johnson Controls Pays $14 Million for China FCPA Violations: DOJ Declines Prosecution

There’s something happening here, but what it is ain’t exactly clear – “For What It’s Worth,” Buffalo Springfield At first glance, the SEC’s recent enforcement action against Johnson Controls for $14 million for FCPA violations in China, along with a Justice Department declination under its new Pilot Program, appears to be a “routine” enforcement matter. Unfortunately, this case was anything but routine and there are...

The SEC’s Love Affair with Internal Controls

The SEC has been flexing its muscles lately. If you had some of the enforcement tools the SEC has, you would be doing the same. What am I referring to? The FCPA statute includes broad provisions requiring companies to maintain adequate internal controls and accurate books and records. If taken literally, these prohibitions can be applied to many situations to support aggressive SEC enforcement actions....

Analogic FCPA Settlement – From Russia With(out) Love

Analogic Corp. and its Danish subsidiary, BK Medical ApS,  settled an FCPA enforcement action last week with the Justice Department and the SEC for approximately $14 million. Analogic agreed to pay $3.4 million to the Justice Department as part of a non-prosecution agreement (NPA), and paid the SEC approximately $11.4 million in disgorgement and interest. Lars Frost, a former CFO at BK Medical, settled an...

The SEC’s Return to Accounting Fraud Enforcement

Just like the ups and downs of the business cycle, SEC enforcement of accounting fraud cases follow an up and down trend as well. For example, during the financial crisis, SEC enforcement of accounting fraud cases took a back seat to enforcement actions surrounding disclosure and conflicts of interest in relation to the financial meltdown. The SEC, in the last two years, has returned to...

Do Former Prosecutors Make Good CCOs?

A number of companies have adopted the requirement that a new Chief Compliance Office come from the ranks of former federal prosecutors. I am not sure exactly why companies have adopted this requirement. Perhaps company leaders think this will give the company an advantage when dealing with the Justice Department or the SEC. With full disclosure here, I admit my bias in favor of federal...