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  • Federal Authorities Announce FCPA Action Against Ralph Lauren, First SEC Non-Prosecution Agreement

    On April 22, the DOJ and the SEC announced parallel actions against Ralph Lauren to resolve allegations that a subsidiary of the company paid bribes to Argentine officials over a several-year period to obtain improper customs clearance of merchandise. The SEC action included the agency's first non-prosecution agreement related to FCPA misconduct, which the SEC determined was appropriate given "Ralph Lauren's prompt reporting of the violations on its own initiative, the completeness of the information it provided, and its extensive, thorough, and real-time cooperation with the SEC's investigation." According to the SEC's NPA, Ralph Lauren's cooperation involved (i) reporting preliminary findings of its internal investigation to the staff within two weeks of discovering the illegal payments and gifts, (ii) voluntarily and expeditiously producing documents, (iii) providing English language translations of documents to the staff, (iv) summarizing witness interviews that the company's investigators conducted overseas, and (v) making overseas witnesses available for staff interviews and bringing witnesses to the U.S. The SEC agreement also required Ralph Lauren to pay over $700,000 in disgorgement and prejudgment interest, while the DOJ required the company to pay a nearly $900,000 penalty.

    Argentina Ralph Lauren

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  • Another Medical Device Case: Philips Settles SEC Administrative Proceeding for $4.5 Million

    On April 5, 2013, Koninklijke Philips Electronics, N.V., the Dutch parent of the Philips group of companies, settled an SEC administrative proceeding for more than $4.5 million.  The SEC alleged that Philips violated the internal controls and books and records provisions of the FCPA based on improper payments by employees of its Polish subsidiary to Polish government officials from 1999-2007 in connection with contracts for medical equipment.  The SEC cited Philips’s voluntary disclosure of the improprieties and subsequent remedial measures in deciding to accept the settlement.

    Poland Philips

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  • Keyuan Petrochemicals Inc. and Former CFO Settle FCPA Books and Records Action with SEC for $1.025 million

    On February 28, 2013, Keyuan Petrochemicals Inc., a China-based issuer with US-trading stock, and its former CFO, settled an enforcement action with the SEC for a total of $1.025 million.  The SEC alleged numerous violations primarily related to a failure to disclose related party transactions, but also alleged the use of an off-balance sheet cash account to pay various expense including gifts to Chinese government officials, and a failure to properly record such transactions.

    China

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  • Judge Refuses to Find Personal Jurisdiction over Siemens Executive, in Conflict with SDNY Colleague’s Ruling in Prior Week

    On February 19, 2013, a federal judge granted the motion to dismiss filed by a Siemens executive, Herbert Steffen, on the grounds that the SEC's civil FCPA complaint had failed to adequately allege personal jurisdiction over him, because the allegations were "far too attenuated from the resulting harm to establish minimum contacts."  A week earlier, a different judge on the same court had refused to dismiss charges against executives of Magyar Telekom on similar personal jurisdiction grounds.

    Argentina Siemens

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  • Judge Finds Personal Jurisdiction over Magyar Telekom Executives

    On February 8, 2013, a federal judge denied the motion to dismiss of several Magyar Telekom executives facing civil FCPA allegations, holding that the SEC had adequately alleged personal jurisdiction because the defendants' alleged conduct was “designed to violate” U.S. securities laws and thus was “directed toward the United States.”  On February 22, the Defendants filed a motion to certify the order for interlocutory appeal to the Second Circuit, which was denied on procedural grounds without prejudice to re-file.

    SEC Magyar Telekom Score Card FCPA Enforcement Action Macedonia

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  • Eli Lilly Settles SEC FCPA Claims for $29.4 Million

    On December 20, 2012, Eli Lilly & Co. settled an enforcement action filed the same day by the SEC for nearly $29.4 million.  The SEC alleged that Lilly subsidiaries in Russia, Brazil, China and Poland made improper payments to government officials to obtain or retain business and that Lilly itself knew of the payments by the Russian subsidiary but did not act to stop the conduct for more than five years.

    China Brazil Russia Poland Eli Lilly

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  • Allianz Settles SEC Administrative Proceeding for $12.3 Million

    On December 17, 2012, German insurance and asset management company Allianz SE settled an administrative proceeding brought by the SEC for more than $12.3 million.  The SEC alleged that Allianz violated the internal controls and books and records provisions of the FCPA in connection with improper payments to government officials by its Indonesian subsidiary over a seven-year period.

    Indonesia Allianz

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  • US Enforcement Authorities Publish FCPA Resource Guide

    On November 14, 2012, the US DOJ and SEC released A Resource Guide to the Foreign Corrupt Practices Act, almost a year to the day that Assistant Attorney General Lanny Breuer announced that the SEC and DOJ would prepare an FCPA Guidance document (click here and here for previous Buckley Sandler posts on this issue).  Overall, the FCPA Guide is a helpful compilation of previously-issued guidance and litigation positions set forth by the DOJ and SEC, and a useful starting point for constructing, testing or revising an FCPA compliance program.

    FCPA Guide

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  • US Enforcement Authorities Publish FCPA Resource Guide

    On November 14, 2012, the US DOJ and SEC released A Resource Guide to the Foreign Corrupt Practices Act, almost a year to the day that Assistant Attorney General Lanny Breuer announced that the SEC and DOJ would prepare an FCPA Guidance document (click here and here for previous BuckleySandler posts on this issue).  Overall, the FCPA Guide is a helpful compilation of previously-issued guidance and litigation positions set forth by the DOJ and SEC, and a useful starting point for constructing, testing or revising an FCPA compliance program.

    DOJ SEC Score Card FCPA Guide

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  • DOJ FCPA Opinion Procedure Release 12-02

    In Fall 2012 the US DOJ issued FCPA Opinion Release 12-02, regarding whether US adoption agencies could pay for and host foreign government officials visiting the US.  The trip would involve the officials interviewing the adoption agencies’ staff and meeting with US families who had previously adopted children from the foreign country.  Payment would be made directly to service providers, with no money, including per diems, given to the officials.  The DOJ opined that under the circumstances, the trips were reasonable and bona fide expenditures directly related to the promotion, demonstration, or explanation of the adoption agencies’ products or services, and therefore permissible under the FCPA.

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