B. Increased, Aggressive Enforcement
- The number of investigations, prosecutions, and enforcement actions has dramatically increased in recent years.
(a) The DOJ
(i) From 2001 to 2004, the DOJ obtained resolutions or filed charges in seventeen FCPA cases. From 2005 to 2008, that number was forty-two. 1
(ii) Within the last four years, the numbers also have increased. As of February 2005, US authorities were handling thirty-five non-US bribery prosecutions and seventeen additional active investigations. By July 2007, these numbers were sixty-seven and sixty, respectively.2
(iii) The sixteen criminal FCPA prosecutions brought by the DOJ in 2007 represents a 100% increase from 2006, when the DOJ brought eight cases, which was the DOJ's previous single-year record.3
(iv) Given the "significant number" of FCPA matters under investigation, the trend is expected to continue.4
(b) The SEC: The SEC has also ratcheted up its enforcement efforts. From 2006 through 2008, the SEC brought approximately three dozen FCPA cases. In the almost 30 year history of the FCPA prior to 2006, the SEC brought approximately six dozen cases.5
- Causes for increased numbers: This increase is not simply the result of additional efforts and resources dedicated by the DOJ and the SEC. According to Mark Mendelsohn, Deputy Chief of the Fraud Section of the DOJ, the factors responsible for this uptick include:
(a) Sarbanes-Oxley: Sarbanes Oxley has resulted in companies focusing on internal controls. It has also made officers and directors of corporations personally responsible for having such controls in place. 6
(b) Globalization: More companies are competing on the international level. In addition, information moves globally and does so rapidly. So with now almost universal access to the internet, email, and search engines such as Google, incidents in what were once remote corners of the planet are more likely to become discovered by the U.S. authorities. 7
(c) Creative resolutions combined with incentives to make voluntary disclosures: Mendelsohn has argued that the increased use of non-prosecution agreements, deferred prosecution agreements, and corporate compliance monitors has provided "positive incentives for responsible companies to self-disclose, to self-investigate, [and] to remediate appropriately." 8
(d) Increase in anti-corruption efforts across the globe: See Section D.
- Prosecution of Individuals: Another trend appears to be an increased emphasis in the prosecution of individuals (as opposed to corporations). This is an "intentional" effort by the DOJ to increase the deterrent effect of its enforcement activities.9
1 Press Release, Department of Justice, Transcript of Press Conference Announcing Siemens AG and Three Subsidiaries Plead Guilty to Foreign Corrupt Practices Act Violations (Dec. 15, 2008), http://www.usdoj.gov/opa/pr/2008/December/08-opa-1112.html (hereinafter "Siemens Press Conf.").
2 Joel M. Cohen, Michael P. Holland & Adam P. Wolf, Under the FCPA, Who Is a Foreign Official Anyway?, 63 Bus. Law. 1243, 1247 (Aug. 2008).
3Mendelsohn Says Criminal Bribery Prosecutions Doubled in 2007, 22 Corporate Crime Reporter 36(1), Sept. 16, 2008, available at http://www.corporatecrimereporter.com/mendelsohn091608.htm (hereinafter ?CCR?).
5 Siemens Press Conf., supra note 1.
9 CCR, supra note 3.