The policy and personnel developments within the Department of Justice (DOJ) in 2023, recent legislative and regulatory activity in the United States and Europe, and the Foreign Corrupt Practices Act of 1977 (FCPA) enforcement docket itself collectively reflect a year of interesting and important developments with respect to anti-corruption enforcement activity.
Within DOJ, revisions to the Corporate Enforcement Policy emphasized increased incentives for early self-disclosure of violations by corporate actors. Pressure on the DOJ to signal the efficacy of those revisions – and, of course, the revisions themselves – may result in the public filing of charges against individuals and announcements of corporate resolutions in the coming months as investigations initiated under the revised policy reach their conclusions. Similar internal pressure to demonstrate the power and incentives of the department-wide mergers and acquisitions voluntary self-disclosure policy, also announced in 2023, may add to those enforcement numbers if, as many predict, deal-making activity takes an upward trajectory in 2024.
The DOJ has also committed to structural and personnel changes, including augmenting the number of prosecutors in multiple DOJ components and the creation of the International Corporate Anti-Bribery (ICAB) initiative, to be steered by a team of three prosecutors in the Criminal Division's Fraud Unit but working with attorneys across and outside of the department. The mission of the ICAB will be focused on international cooperation: facilitation of information sharing and coordination of cross border enforcement actions. Within the first days of 2023, the DOJ announced a deferred prosecution agreement with SAP SE, a German software company accused of bribery of officials at state-owned enterprises in South Africa. The SAP matter both emphasizes these new DOJ policies, priorities, and personnel moves and will likely be the first of several such actions this year. On December 22, 2023, President Biden signed the newly enacted Foreign Extortion Prevention Act (FEPA) as part of the annual defense spending package. The FEPA makes it a crime for foreign officials to demand or accept a bribe from an
American or American company (or from any global person or entity if the bribe takes place in the United States) in connection with obtaining or retaining business. FEPA criminalizes the demand side of foreign corruption, filling a gap in the FCPA, which focuses on the "supply" of bribery by businesses seeking to operate abroad. Although U.S. prosecutors have long used money laundering laws to bring cases against foreign officials engaged in bribery through cross-border payments, the new law both expands the prosecutorial toolkit by removing the need to identify cross-border payments through the U.S. financial system and comports with an administration-wide effort to attack the "demand" side of global corruption.
Policy activity related to anti-corruption enforcement is not limited to the United States. Also in December 2023, the European Council and Parliament announced a proposed directive setting out EU-side minimum rules on the tracing, identification, freezing, confiscation, and management of criminal property, akin to the United States' asset forfeiture regime. This proposed directive cites the UN Convention Against Corruption and defines relevant criminal offenses to include corruption. In addition to providing a uniform, minimum toolkit for financial investigations and asset seizures for prosecutors across member states and at the European Public Prosecutor's Office, such a measure, if ultimately enacted, would further facilitate international cooperation between European and U.S. authorities in financial investigations.
Finally, with respect to the FCPA cases brought in 2023, there were several interesting trends, including: 1) a plethora of different industries impacted by the corporate enforcement matters, which included not only traditional high-risk sectors such as extractive industries and medical devices, but also more uncommon ones such as sports betting, IT services, and reinsurance; 2) ever clearer articulation by the DOJ in its corporate resolutions of the policy considerations brought to bear in determining the sanctions and settlement conditions; 3) a steady stream of corporate enforcement actions by the SEC, but no SEC actions against individuals; and 4) a demonstrable DOJ push to bring individual prosecutions.
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