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12 November 2018
After the election of President Donald Trump, many observers wondered whether the US Department of Justice (DOJ) would change the way in which it enforces the Foreign Corrupt Practices Act. In a 2012 interview, Trump famously called the Foreign Corrupt Practices Act a "horrible law" and argued that it is "absolutely ridiculous" that the DOJ brings criminal charges against companies and individuals for alleged Foreign Corrupt Practices Act violations. Once Trump's political appointees in the DOJ were confirmed in the Senate, would they act on his public statements?
The answer, so far, is no. As the halfway point of Trump's first term in office approaches, the DOJ has not made any dramatic changes to the enforcement philosophy followed during prior administrations. The DOJ continues to use the same basic playbook to prosecute foreign bribery. It is:
The DOJ's enforcement actions tell the story. It is bringing the same types of case that would have been brought in any previous administration. For instance:
Of course, there is an irony in the DOJ's emphasis on building relationships with other governments. While Trump is arguing that US allies are not contributing enough to trade deals, military spending or border walls, the DOJ has taken the opposite approach. It agreed to credit 80% of the $853.2 million penalty paid by Petrobras to the Brazilian government and 50% of the $585 million criminal penalty for Foreign Corrupt Practices Act violations paid by Société Générale to the French government. The DOJ's willingness to share credit – and penalties – with other governments is likely to extend its influence and jurisdictional reach.
The DOJ's public statements tell a similar tale, and do not reflect any hostility towards Foreign Corrupt Practices Act enforcement. For instance, in a recent speech in Brazil, Principal Deputy Assistant Attorney General John Cronan stated: "we believe that our emphasis on individual accountability has the greatest impact on preventing and deterring corruption." Cronan also commented on the government's hopes that companies will engage in "greater reporting of misconduct, increased cooperation with law enforcement, and stronger compliance programs and internal controls". These same sentiments have been echoed – almost word-for-word – through the years in speeches by DOJ officials in Republican and Democratic administrations alike.
The DOJ has made some changes and reforms during the Trump administration, but these changes only refine the same general law enforcement philosophies that the DOJ has traditionally used:
These reforms are merely continuations of what the DOJ might have considered during the Obama administration, the Bush administration or nearly any other presidential administration. The Trump administration may have changed many things, but it has not altered the DOJ's prosecutions of foreign bribery. At least not yet.
For further information on this topic please contact Michael P Kelly at Hogan Lovells US LLP by telephone (+1 202 637 5600) or email (firstname.lastname@example.org). The Hogan Lovells US LLP website can be accessed at www.hoganlovells.com.
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Michael P Kelly