When prosecutors turn on you, watch out. The economy is full of fraudsters, many of whom escape detection. Conmen, liars and cheats abound – when they get caught, however, the consequences can be severe. Interestingly, the SEC’s enforcement regime extends beyond the public markets and includes private companies. In the technology sector, there are numerous technology start-ups, all living for the dream to be acquired...
Lawyers can “Break Bad” and veer from ethical and professional standards. Somehow this is not so hard to envision. Legal misconduct occurs more than most expect. And the system reacts in variety of ways – professional responsibility enforcement actions and judges stand as the two most important watchdogs over legal professional conduct. In a curious and headline-making case, Judge Royce Lamberth, who is known for...
Judge Stanley Sporkin was a mentor, a professional colleague and a friend. I admired Judge Sporkin, respected his commitment to integrity and valued our professional collaboration and personal friendship. Judge Stanley Sporkin died on March 23, 2020. He was 88 years old. I am compelled to write about my friend. I will miss him. Judge Sporkin’s reputation for fairness and integrity was beyond reproach. His...
Microsoft’s bribery and controls violations reflect significant risks facing companies that rely on distributor and reseller networks to sell their products. Companies often enter and operate in emerging markets through complex networks of third parties. Such distribution systems create significant anti-corruption risks that have to be managed and mitigated. It is worth taking the time to examine the precise outlines of the conduct at issue...
The MTS FCPA enforcement action stands as one of several significant prosecutions in FCPA history. The breadth and depth of MTS’ corruption scheme stands as another example of systemic bribery cultures. The details of the enforcement action underscore several important trends and enforcement policies. Let’s review some of the more significant lessons learned and trends. Application of FCPA Corporate Enforcement Policy: MTS was not able...
The MTS bribery scandal in Uzbekistan represents the culmination of several significant FCPA violations involving VimpelCom, Telia Sonera, MTS, and Gulnara Karimova, the notoriously corrupt daughter of the former Uzbek President. Karimova is perhaps one of the most notorious corrupt offenders in the world. She has been under house arrest in Uzbekistan since 2014. (Indictment Here). According to MTS’ admissions, MTS and its subsidiaries, Uzdunrobita...
UBS Group agreed to pay a combined $15 million penalty to the US Treasury Department’s Financial Crimes Enforcement Network (“FinCEN”)and the SEC for regulatory deficiencies in its anti-money laundering compliance program. UBS is required to pay $5 million to the Treasury Department; $5 million to the SEC and another $5 million to FinCEN. UBS’ broker-dealer unit, UBS Financial Services, Inc. (“UBSFS”), violated the Bank Secrecy...
Legg Mason can finally close its books on the Gaddafi-era, Libyan bribery scandal. In June 2018, Legg Mason entered into a non-prosecution agreement with the Justice Department and agreed to pay $32 million for its role in the bribery scheme. Société Générale entered into a deferred prosecution agreement and paid $585 million for FCPA violations. Société Générale and Legg Mason admitted to paying over $90...
Abbott and Costello’s famous routine — Who’s on First, What’s on Second — puts cryptocurrency regulation and enforcement risks in perspective. Here is the classic comedy routine. When new technologies appear on the scene, Washington regulation is sure to follow. The exact configuration can take years to sort out, especially when it comes to financial products, given the labyrinth of regulatory bodies seeking to lay...
Just when everyone was anticipating the beginning of an uptick in FCPA enforcement in 2017, the Justice Department and the SEC delivered a resounding message to remind everyone that FCPA enforcement is here to stay. However, the Telia decision may be the first indication of some changes in DOJ’s FCPA enforcement policies. It is hard to say from just one major DOJ enforcement action but...
