The former DOJ top cop speaks, Senator Feingold joins the debarment discussion, anything is possible, and a House Resolution focused on BP ... it's all here in the Friday roundup.
Mendelsohn Interview
During the period of the FCPA's resurgence, Mark Mendelsohn was the public face and voice on FCPA issues at the Department of Justice. In April, he announced his departure and now maintains an FCPA private practice at Paul Weiss. (See here and here for more).
See here for Mendeloshn's recent interview with The Metropolitan Corporate Counsel as he reflects back on his DOJ tenure and other issues.
Senator Feingold Joins The Debarment Discussion
Earlier this week Senator Russ Feingold (D-WI) testified before the Senate Judiciary Subcommittee on Administrative Oversight and the Courts (see here). The hearing was on the topic of "Protecting the Public Interest: Understanding the Threat of Agency Capture." He began his testimony by stating that a better job needs to be done to ensure that there are no significant conflicts of interest or other inappropriate ties between regulators and the corporations they purport to regulate."
He then stated:
"I want to raise a concern that a new, more subtle type of agency capture is beginning to emerge as a result of our increasing reliance on government contractors. The Council of the Inspectors General on Integrity and Efficiency recently reported that the total number of suspensions and debarments in FY 2008 was half the total from five years ago, and that suspensions and debarments had been steadily decreasing over the last five years. This is a disturbing statistic, especially when you consider that the number of contract fraud, Foreign Corrupt Practices Act, and other corruption investigations involving contractors is on the rise."
For more on debarment issues, including an FCPA debarment bill pending in the House see here and here and here.
Is It Possible?
Is it possible to spend $3.2 million on "professional costs" associated with an internal investigation "limited in size and scope" to a branch office that represents approximately one-half of one percent of the company's annual consolidated revenues?
Apparently it is.
In January I ran this post about Team Inc. and its voluntary disclosure of less than $50,000 in potentially improper payments in its Trinidad branch.
Earlier this week, when disclosing its financial results, the company stated as follows:
"The results of the FCPA investigation were communicated to the SEC and Department of Justice in May 2010 and the Company is awaiting their response. The results of the independent investigation support management's belief that any possible violations of the FCPA were limited in size and scope. The total professional costs associated with the investigation were approximately $3.2 million." (emphasis added).
Exhibit A for how even isolated instances of improper conduct under the FCPA in a branch office can be very expensive or Exhibit A for just how out of whack professional costs associated with an FCPA internal investigation and disclosure have become?
It's your conclusion to make.
BP House Resolution
This recent post discussed Senator Charles Schumer's (D-NY) request that the Department of Justice investigate BP for FCPA violations.
On July 30, House Resolution 1597 was introduced. Sponsored by Representative Daniel Maffei (D-NY) and co-sponsored by Representatives Christopher Lee (R-NY) and Michael McMahon (D-NY) the resolution (see here) encourages the United Kingdom to "investigate British Petroleum (BP) for foreign corrupt practices."
The reason?
The same as offered by Senator Schumer - that BP attempted to influence the August 2009 release of Abdel Baset al-Megrahi, the Libyan terrorist convicted of the 1988 bombing of Pan-Am flight 103 that killed 270 people, including 189 Americans.
The resolution states, in part:
"Whereas the Scottish courts released al-Megrahi from prison on August 20, 2009, under the understanding that he was suffering from terminal prostate cancer;
Whereas the Scottish authorities have never clarified why al-Megrahi could not receive humane treatment while still in captivity;
Whereas al-Megrahi seems to have well outlived his original diagnosis;
Whereas it is very troubling that al-Megrahi received a hero’s welcome to his home country of Libya;
Whereas British Petroleum (BP) admitted on July 15, 2010, that a delayed prisoner-transfer between Britain and Libya ‘could have a negative impact’ on BP’s oil negotiations;
Whereas there are allegations that BP inappropriately attempted to affect the Scottish Government’s decision and possibly even the doctor’s diagnosis; and
Whereas al-Megrahi’s release sends an incredibly offensive message to the families that lost loved ones on Pan Am Flight 103: Now, therefore, be it
Resolved, That the House of Representatives encourages the United Kingdom to investigate British Petroleum (BP) for foreign corrupt practices."
As I asked in my original post - following Schumer's (and now Maffei's) lead will a British politician request that the U.K. Serious Fraud Office or the U.S. government investigate a U.S. company because it lobbied its own government officials in connection with a business purpose?
*****
A good weekend to all.
Mendelsohn Interview
During the period of the FCPA's resurgence, Mark Mendelsohn was the public face and voice on FCPA issues at the Department of Justice. In April, he announced his departure and now maintains an FCPA private practice at Paul Weiss. (See here and here for more).
See here for Mendeloshn's recent interview with The Metropolitan Corporate Counsel as he reflects back on his DOJ tenure and other issues.
Senator Feingold Joins The Debarment Discussion
Earlier this week Senator Russ Feingold (D-WI) testified before the Senate Judiciary Subcommittee on Administrative Oversight and the Courts (see here). The hearing was on the topic of "Protecting the Public Interest: Understanding the Threat of Agency Capture." He began his testimony by stating that a better job needs to be done to ensure that there are no significant conflicts of interest or other inappropriate ties between regulators and the corporations they purport to regulate."
He then stated:
"I want to raise a concern that a new, more subtle type of agency capture is beginning to emerge as a result of our increasing reliance on government contractors. The Council of the Inspectors General on Integrity and Efficiency recently reported that the total number of suspensions and debarments in FY 2008 was half the total from five years ago, and that suspensions and debarments had been steadily decreasing over the last five years. This is a disturbing statistic, especially when you consider that the number of contract fraud, Foreign Corrupt Practices Act, and other corruption investigations involving contractors is on the rise."
For more on debarment issues, including an FCPA debarment bill pending in the House see here and here and here.
Is It Possible?
Is it possible to spend $3.2 million on "professional costs" associated with an internal investigation "limited in size and scope" to a branch office that represents approximately one-half of one percent of the company's annual consolidated revenues?
Apparently it is.
In January I ran this post about Team Inc. and its voluntary disclosure of less than $50,000 in potentially improper payments in its Trinidad branch.
Earlier this week, when disclosing its financial results, the company stated as follows:
"The results of the FCPA investigation were communicated to the SEC and Department of Justice in May 2010 and the Company is awaiting their response. The results of the independent investigation support management's belief that any possible violations of the FCPA were limited in size and scope. The total professional costs associated with the investigation were approximately $3.2 million." (emphasis added).
Exhibit A for how even isolated instances of improper conduct under the FCPA in a branch office can be very expensive or Exhibit A for just how out of whack professional costs associated with an FCPA internal investigation and disclosure have become?
It's your conclusion to make.
BP House Resolution
This recent post discussed Senator Charles Schumer's (D-NY) request that the Department of Justice investigate BP for FCPA violations.
On July 30, House Resolution 1597 was introduced. Sponsored by Representative Daniel Maffei (D-NY) and co-sponsored by Representatives Christopher Lee (R-NY) and Michael McMahon (D-NY) the resolution (see here) encourages the United Kingdom to "investigate British Petroleum (BP) for foreign corrupt practices."
The reason?
The same as offered by Senator Schumer - that BP attempted to influence the August 2009 release of Abdel Baset al-Megrahi, the Libyan terrorist convicted of the 1988 bombing of Pan-Am flight 103 that killed 270 people, including 189 Americans.
The resolution states, in part:
"Whereas the Scottish courts released al-Megrahi from prison on August 20, 2009, under the understanding that he was suffering from terminal prostate cancer;
Whereas the Scottish authorities have never clarified why al-Megrahi could not receive humane treatment while still in captivity;
Whereas al-Megrahi seems to have well outlived his original diagnosis;
Whereas it is very troubling that al-Megrahi received a hero’s welcome to his home country of Libya;
Whereas British Petroleum (BP) admitted on July 15, 2010, that a delayed prisoner-transfer between Britain and Libya ‘could have a negative impact’ on BP’s oil negotiations;
Whereas there are allegations that BP inappropriately attempted to affect the Scottish Government’s decision and possibly even the doctor’s diagnosis; and
Whereas al-Megrahi’s release sends an incredibly offensive message to the families that lost loved ones on Pan Am Flight 103: Now, therefore, be it
Resolved, That the House of Representatives encourages the United Kingdom to investigate British Petroleum (BP) for foreign corrupt practices."
As I asked in my original post - following Schumer's (and now Maffei's) lead will a British politician request that the U.K. Serious Fraud Office or the U.S. government investigate a U.S. company because it lobbied its own government officials in connection with a business purpose?
*****
A good weekend to all.
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