Issue link: https://digital.shearman.com/i/1389983
4 STATISTICS In the first half of 2021, the DOJ and SEC jointly resolved two corporate enforcement actions against Deutsche Bank and Amec Foster Wheeler, the lowest number of corporate enforcement actions in a six-month period since 2006. Of note, the Biden administration has only brought one corporate enforcement action but given the length of time necessary to complete a full-fledged investigation, that likely speaks more to the cases prepared under the previous administration than the work of the agencies' staff under the new President. Regarding the FCPA enforcement actions against individuals in the first half of 2021, the DOJ charged or unsealed charges against thirteen individuals, while the SEC brought no cases against individuals. Two defendants were charged as foreign officials related to previously announced cases against Sargeant Marine, Inc. and related to alleged bribery at PetroEcuador, the South American country's oil and gas SOE. The DOJ also charged four individuals in connection with efforts to obtain contracts with the government of Chad on behalf of a Canadian energy company. The DOJ further announced charges against two individuals for an alleged scheme to obtain investment business with the public police pension fund of Ecuador. Finally, the DOJ announced charges against five defendants for their alleged efforts to illicitly secure a contract to sell tactical equipment to the Bolivian Ministry of Defense. We discuss the 2021 YTD corporate enforcement action(s), followed by the individual enforcement actions, in greater detail below. CORPORATE ENFORCEMENT ACTIONS The Deutsche Bank matter comes less than two years after the bank settled with the SEC concerning allegedly improper hiring of government officials' relatives. According to the DOJ and SEC pleadings, from 2009 and 2016, "business development consultants" hired by Deutsche Bank made corrupt payments to foreign officials and the corresponding transactions were falsely recorded on the bank's books and records. These payments, which were not subject to meaningful due diligence and were made without invoices or adequate documentation of services provided, were alleged to have been for the purpose of obtaining lucrative transaction work in Abu Dhabi, Saudi Arabia, and Italy. On January 8, 2021, the DOJ announced that it had entered into a three-year deferred prosecution agreement with Deutsche Bank on December 18, 2020, which covered both FCPA matters and a separate fraud involving the precious metals market, pursuant to which the bank agreed to pay a criminal monetary penalty of $79.6 million. Deutsche Bank received a twenty-five percent discount off the recommended minimum sentence under the U.S. Sentencing Guidelines for its cooperation and full remediation. Once the payment is received by the U.S. Treasury, $20 million will be paid to the U.S. Postal Inspection Service Consumer Fraud Fund for their assistance in the investigation. Related to the same conduct, in January the SEC also settled an enforcement action against Deutsche Bank for violating the internal controls and books-and-records provisions of the FCPA by issuing a cease-and-desist order. Per the terms of the order, Deutsche Bank will pay disgorgement of $35.1 million and prejudgment interest of $8.2 million. The SEC did not impose a civil penalty based on a penalty assessed by the DOJ against the bank in the parallel investigation. The Amec Foster Wheeler ("AFW") enforcement action, announced on June 25, 2021, is the latest entry in the saga of Unaoil-related bribery cases. Perhaps, the most noteworthy aspect of AFW is the close coordination among international enforcers, including the SFO and Brazilian authorities. According to the DPA with the DOJ, AFW, a subsidiary of the U.K.-based Wood Group, bribed Brazilian officials between 2011 and 2014 in return for a $190 million contract to design a gas-to-chemicals facility. In the DPA, AFW admitted to conspiring with a Monaco-based intermediary, an Italian sales agent, and a store manager at a high-end men's clothing store in New York City to pay bribes to Petrobras officials to secure the project. When AFW's compliance process identified red flags associated with the Italian agent, the agent was allowed to continue facilitating the transaction unofficially. Having secured the contract, AFW earned at least $12.9 million in profit. The SEC highlighted AFW's use of third-party agents to carry out the alleged bribe scheme, including one agent who was allowed to continue working "unofficially" after they had failed AFW's diligence process. The SEC cited the latter as a "fundamental flaw" in AFW's compliance program. The SEC also found that AFW had paid approximately $1.1 million to land a contract to build a gas facility.