This is the second in our 2025 Year in Preview series examining important trends in white collar law and investigations in the coming year. We will be posting further installments in the series throughout the next several weeks. A companion piece, "2024 in Review: Key Anticorruption Developments in the EU and France, with insights for 2025," can be found here. Our previous post, "Health Care Fraud Enforcement in 2025," can be found here.
With active regulators around the globe, 2024 was a busy year for anticorruption enforcement and policy. In the U.S., we saw multiple high-profile new policies and updated guidance from the U.S. Department of Justice ("DOJ"), while regulators worldwide picked up on trends to issue guidance on their key or newly available enforcement tools. We also learned lessons from significant enforcement activity at home and abroad. Below, we unpack the key trends from the past year with a look ahead to impacts in 2025.
For anticorruption trends and developments in France and the European Union, see today's companion piece from our colleagues in Paris.
U.S. POLICY DEVELOPMENTS TO INFORM 2025 ACTIVITY
DOJ issued several policy pronouncements, primarily throughout the latter half of 2024, concerning its corporate and FCPA enforcement policies. Below are our key takeaways from these developments.
Corporate Whistleblower Awards Pilot Program
On August 1, 2024, DOJ announced the start of the Corporate Whistleblower Awards Pilot Program ("Whistleblower Program"). This program gives whistleblowers, who provide DOJ with original and truthful information regarding corporate wrongdoing—which results in a forfeiture, a chance to receive a reward.
The potential reward is contingent on specifications provided in the Whistleblower Program guidance (e.g., the forfeiture must be over $1 million), and consists of a percentage of the forfeiture. To be eligible for compensation, the information the whistleblower provides needs to relate to one or more of the areas described below:
- Certain crimes involving financial institutions, from traditional banks to cryptocurrency businesses
- Foreign corruption involving misconduct by companies
- Domestic corruption involving misconduct by companies
- Health care fraud schemes involving private insurance plans.
Notably, entities that self-disclose voluntarily within 120 days of the submission of a whistleblower's report may receive a presumption of a declination of prosecution, under DOJ's Corporate Enforcement and Voluntary Self-Disclosure Policy. This only occurs, however, if an entity reports before DOJ comes knocking.
The Whistleblower Program closes a loophole in FCPA enforcement. Under the Dodd-Frank whistleblower program, only referrals leading to enforcement actions against public companies listed on the U.S. stock exchanges would result in a reward. The DOJ program also applies to referrals resulting in enforcement actions against non-public companies under the FCPA (and other laws). The Whistleblower Program has the potential to increase DOJ corporate investigations in 2025 and beyond.
Compensation Incentives and Clawbacks Pilot Program
On September 23, 2024 PDAAG Argentieri spoke about initial results of a DOJ initiative, the Compensation Incentives and Clawbacks Pilot Program, that DOJ announced in March 2023 ("Clawback Program"). The Clawback Program has two parts. Regarding the first, every Division corporate resolution now requires that the subject entity provide "clear metrics" regarding how its compensation and bonus systems promote compliance.
Since the inception of the Clawback Program, as PDAAG Argentieri reports, nine corporate resolutions have included this requirement. Examples comprise entities agreeing to:
- Mandate that their annual review process account for reporting of wrongdoing and compliance standards.
- Add a performance review metric assessing whether the employee acts in accordance with the entity's core values.
The second part of the Clawback Program concerns a penalty reduction for entities that either withhold or recover compensation from employees and their respective supervisors who are found to be responsible for the misconduct at issue. So far, only two entities have obtained fine reductions, solely in FCPA cases. Only one—an enforcement action against SAP SE ("SAP"), a German-based international software company—took place in 2024. SAP received a 40% fine reduction, in part because it withheld compensation from liable employees.
Evaluation of Corporate Compliance Programs (ECCP)
In September 2024, DOJ announced several updates to the ECCP guidance critical to practitioners in this space. DOJ will now include an assessment of the efficacy of a corporate enforcement program the following factors:
- Risks of AI and Other Disruptive Technologies – The updates include considering how companies assess and manage risks from these emerging technologies.
- Encouraging Whistleblowers – Building on DOJ's recent whistleblower program, the ECCP now explicitly assesses whether companies encourage internal whistleblowers.
- Data Access – The revised ECCP emphasizes the subject compliance program's access to sufficient and appropriate data to be effective.
- Lessons Learned – The updates indicate that companies' compliance programs and training should build on their own prior incidents and those of other companies.
- Post-Transaction Integration – Following 2023's announced Safe Harbor for Voluntary Self-Disclosures Related to Mergers & Acquisitions, the ECCP updates reinforce the need for compliance involvement in acquisitions, including the target company's post-merger integration into the acquirer's business environment.
Blue Dot Network
In addition to the above-described policy pronouncements, the U.S. partnered with other countries in a joint effort to battle corruption at the international level. On April 9, 2024, in coordination with partner countries and the Organization for Economic Cooperation and Development, the U.S. Department of State announced the Blue Dot Network ("BDN").
The BDN provides a globally recognized certification for infrastructure projects' quality and sustainability across all major sectors (e.g., water, energy, and transport). It is based on 10 elements, including, in relevant part, promoting "protections against corruption, while encouraging transparent procurement and consultation processes."
TAKEAWAYS FROM 2024 FCPA ENFORCEMENT ACTIONS
Below, we summarize some trends that emerge from the DOJ Fraud Section's FCPA Unit activity in 2024.
Continued Emphasis on the Commodities Trading Sector in Collaboration with CFTC
Oil and gas commodities cases continue to yield corporate and individual actions from the FCPA Unit. In March, the unit announced two corporate resolutions in this space, with trading firms Gunvor, S.A. and Trafigura Beheer B.V. Another firm, Freepoint Commodities LLC, reached a separate resolution with DOJ, announced in December 2023. Notably, while these cases also concerned what may be considered more traditional FCPA allegations—the payment of bribes to a state-owned entity in exchange for oil contracts—the cases against Trafigura and Freepoint featured additional and somewhat different allegations. As with the landmark 2022 resolution with Glencore and the 2020 resolution announced with Vitol Inc., the government alleged that bribes or kickback payments were made in exchange for confidential trading information from the state-owned entities, in violation of the FCPA. The Commodity Futures Trading Commission ("CFTC") also pursued parallel investigations in these cases and secured parallel resolutions of allegations that the conduct resulted in violations of the Commodities Exchange Act through either manipulation of commodities benchmark prices or trading on material nonpublic information. These cases follow the CFTC's 2019 launch of its Foreign Corrupt Practices Initiative, which it expressly conceived as a collaborative effort with DOJ's FCPA investigations.
In individual prosecutions arising from these corporate resolutions, the FCPA unit in 2024 prevailed at trial twice against individual traders of oil and gas commodities. Javier Aguilar was a former trader with Vitol, while Glenn Oztemel's case stemmed from conduct relating to his work for Freepoint and another U.S.-based commodities trading firm, Arcadia Fuels Ltd.
Cooperation – Some Better than None, but Best to Be Quick
Several actions announced in 2024 provided continuing color on that critical factor in engagement with DOJ: cooperation. Some recent corporate resolutions suggest that even less-than-fulsome cooperation may receive some credit, but the highest credit is available only to corporations that can bring resources to bear on the cooperation effort with alacrity.
In several cases this year, DOJ penalized companies by giving less than full cooperation credit for companies that had failed to preserve and produce evidence in a timely manner during the early phases of DOJ's investigation. At the low end of credit received, DOJ agreed to reduce the penalty imposed on Trafigura by just 10%. DOJ likewise cited Raytheon Company and Telefonica Venezolana C.A. for similar shortcomings in their cooperation.
Telefonica Venezolana fared only slightly better by agreeing to a 20% reduction off the low end of the guidelines, with the government again noting that the company's initial response to the investigation did not identify and produce certain records the government deemed important. Nonetheless, the government did credit the company's many other cooperation efforts, including making non-U.S. employees available for interviews and producing (translated) documents from abroad.
Raytheon resolved separate criminal and civil investigations being conducted by DOJ by agreeing to pay a $950 million combined penalty, entering two separate Deferred Prosecution Agreements and a civil False Claims Act settlement, and agreeing to the imposition of a compliance monitor. While the U.S. Attorney's Office in Massachusetts resolved an investigation related to alleged procurement fraud, the FCPA Unit resolved its case relating to violations of the FCPA and the export controls found in the International Traffic in Arms Regulations ("ITAR"). Focusing on the FCPA resolution, for which Raytheon received a 20% discount off of the guidelines, the government specifically noted that Raytheon was, in its view, "slow to respond to the government's requests" in the early phases of the investigation, and, perhaps most significantly, that the company failed to affirmatively provide information relating to the ITAR violations during the government's FCPA investigation. The announcement conveys a clear signal to practitioners: cooperate early and cooperate fully. If the prosecutors learn of another undisclosed category of misconduct partway through the investigation, negotiations will surely become more difficult.
Finally, DOJ saved its most critical commentary for a comparatively smaller case, resolved with BIT Mining Ltd. in November 2024. There, the government recognized credit for cooperation but characterized that cooperation as "reactive and limited in degree and impact." Ultimately, the criticism did not translate to a particular guidelines discount because the resolution separately recognized an inability-to-pay concession.
Voluntary Self-Disclosure Credit – The Need for Speed
Two corporate resolutions announced this year illustrate that DOJ has significant criteria for awarding credit under its Voluntary Self-Disclosure ("VSD") Policy, an approach that shows no signs of relenting in 2025.
In December, DOJ announced a non-prosecution agreement had been reached with AAR Corp. The resolution arose from a self-disclosure, and the company ultimately received a reduction of 45% from the applicable guidelines range in consideration of its cooperation. Nonetheless, the Department expressly noted that AAR's disclosure did not qualify for the VSD policy because (1) prior "English-language articles had been published in media outlets in Nepal and South Africa" that described potential irregularities and (2) 12 days before the self-report, another source reported some of the allegations to DOJ. This demonstrates that when the government says the self-reporting company must come forward "prior to the misconduct being publicly disclosed or otherwise known to the government," it means what it says. The possibility of a significant cooperation credit or even a declination is a substantial carrot, but it requires that a company be first in the door to report on itself: A reporting difference of less than a fortnight, and public articles that might not capture all of the conduct, may otherwise have a dramatic impact on the penalty a company receives at the conclusion of an investigation.
Demonstrating the point, on August 27, 2024, the Department issued a declination letter stating that it would not prosecute Boston Consulting Group, Inc. ("BCG") for its former employees' alleged violation of the FCPA involving bribes to Angolan officials. PDAAG Argentieri highlighted this action in her September 2024 remarks as an example of what is required to obtain declination under the Corporate Enforcement Policy and VSD Policy, including, of course, timely and voluntary disclosure of evidence of a potential FCPA violation, as well as termination of personnel, clawing back equity from partners, and denying severance packages and bonuses.
SEC Resolutions – Reinforcing Compliance Needs in Foreign Subsidiaries
In addition to its joint resolutions with DOJ in several of the criminal cases noted above (including AAR Corp., Raytheon, and BIT Mining, LTD.), the SEC also settled several FCPA cases on a purely civil basis without DOJ. These cases, including against Moog, Inc. and Deere & Company, resolved allegations regarding the books and records provision of the FCPA, as opposed to the substantive bribery provision. Such cases did not appear to involve allegations of any knowing participation by the U.S. parent entities—only the failure of the companies' internal controls to properly detect and account for bribery conduct occurring entirely in foreign subsidiaries. These actions highlight the need for acquiring and parent companies to implement sufficiently rigorous compliance and accounting controls in their foreign subsidiaries in light of the SEC's broad jurisdictional reach to investigate books and records violations.
BROADER TRENDS AROUND THE WORLD
Offering Guidance and Seeking Whistleblowers
Heading into 2025, practitioners should be mindful of key developments in the EU and France, as our colleagues in Paris recapped in their companion piece.
Beyond the developments recapped there, regulators across the globe have picked up on growing trends toward offering formal compliance guidance to regulated entities and encouraging whistleblowers to step forward through formal government programs.
United Kingdom
The UK and its Serious Fraud Office ("SFO"), including Director Nick Ephgrave, picked up on both trends in 2024.
On the guidance front, in November 2024, the UK's Home Office published guidance on the new corporate criminal offense of failure to prevent fraud, which goes into effect on September 1, 2025.
Meanwhile, on four different occasions in 2024, Nick Ephgrave appeared to call for the implementation of a whistleblower award program in the UK, which would represent a significant new tool in the SFO's enforcement toolbox. The steady drumbeat of calls for such a program makes this an area to watch in 2025.
In addition to these trends, the UK also saw several notable anticorruption enforcement actions. In May 2024, former Chief of Staff to President Andry Rajoelina of Madagascar, Romy Andrianarisoa, became the first foreign official tried and convicted under the UK Bribery Act. Later, in August 2024, the SFO charged five Glencore executives—and a sixth in September 2024—based on their alleged involvement in a conspiracy whereby they made corrupt payments to benefit Glencore's West African oil operations. According to the SFO's release, the Glencore unit involved in this conduct was based in London. This case may be worth monitoring as 2025 progresses.
Australia
In line with the above, on August 28, 2024, the Australian government published guidance detailing, for the first time, the "adequate procedures" that companies can take to establish an effective anti-bribery compliance program.
China
On October 11, 2024, China's State Administration for Market Regulation issued the Draft Compliance Guidelines for Healthcare Companies to Prevent Commercial Bribery Risks. This represents a notable step toward increased clarity from regulators through an approach similar to that of the U.S. DOJ's FCPA Resource Guide in the wake of an ongoing multi-agency anticorruption push in China's healthcare and life sciences sectors launched in July 2023 (as we discussed last year).
Concurrently with the Draft Compliance Guidelines, the National Medical Products Administration in China also announced its own landmark development in the first healthcare-specific whistleblower program in the country through the Draft Rule on Rewarding Internal Whistleblowers for Reporting on the Quality and Safety Issues of Drugs and Medical Devices.
The draft compliance guidelines and the draft whistleblower rule both suggest that Chinese regulators may be looking to examples from other jurisdictions in pursuing their own fight against corruption.
Originally published 23 January 2025
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
