Lucinda Low, William Gordon, Monica Ager, Owen Bonheimer,
Michael Lieberman, Lauren Groth, Elisabeth Page, Berengere Parmly
and Jeanne Cook contributed to this report.
The Foreign Corrupt Practices Act (FCPA) continued to be a
hotbed of activity in 2011. Although aggregate fines fell
precipitously between 2010 ($1.8 billion) and 2011 ($508.6
million), that decline was more a reflection of the anomalies of
2010 than of 2011. 2011 saw significant enforcement activity
against both corporations and individuals, as well as the
development of substantive legal issues that will likely have
lasting effects on FCPA law and practice.
Enforcement agencies continued the trend of targeting
individuals in 2011. While 16 companies were targeted in
2011, 19 different individuals were the targets of new FCPA
Judicial decisions—either interlocutory rulings or
trial results—were the "wild card" of
2011. Several cases featured challenges to the definition of
"foreign official," specifically whether the FCPA's
scope encompasses officers and employees of state-owned enterprises
(SOEs). While the decisions, which are described in detail
below, did not per se exclude SOEs from the definition of
"foreign official," they did indicate that an officer or
employee of an SOE should not automatically be defined as a
"foreign official" without further analysis.
Finally, the most notable FCPA issue of 2011 was the
government's difficulty obtaining (or in the case of
Lindsey Manufacturing, preserving) FCPA convictions.
The government went to trial three times in FCPA related cases in
2011—two trials in the Shot Show cases as well as in
Lindsey Manufacturing—without being able to
secure a conviction. Additionally, in early 2012,
the government was unsuccessful in its trial of the
O'Shea case. However, the government
was able to secure one conviction in 2011 in the Haiti
Along with heightened World Bank enforcement, 2011 also saw the
entry into force of several new legislative initiatives, including
the Dodd-Frank Whistleblower Regulations, the UK Bribery Act and
significant amendments to China's PRC Criminal Code. How
these additions will affect anti-corruption enforcement is a
question that remains to be answered.
In its first public Policy Statement regarding the treatment of cooperation in investigations, the Public Company Accounting Oversight Board provided guidance on how it will consider a firm’s or associated person’s "extraordinary cooperation".
After a two-week trial before United States District Court Judge Edward Chen of the Northern District of California, David Nosal was convicted of three counts of violating the Computer Fraud and Abuse Act.
The U.S. Court of Appeals for the Second Circuit in United States v. Walsh ruled that the defendant could not use the proceeds from the sale of his house to fund his criminal defense because he used tainted funds to obtain the home.
In Commonwealth v. Nies, No. 5793-2012 (Pa. Ct. Com. Pl, Apr. 18, 2013), the Honorable John A. Boccabella of the Berks County Court of Common Pleas applied a somewhat rare exception to the requirement that those who do not submit to a blood test in connection with a DUI investigation are subject to enhanced sentencing requirements.