The SEC has signaled plans to double down on its FCPA enforcement efforts and speed up FCPA investigations. On November 9, 2017, Steven Peikin, Co-Director of the SEC’s Enforcement Division, delivered a speech at New York University School of Law to commemorate the 40th anniversary of the FCPA and the 20th anniversary of the Organisation for Economic Co-Operation and Development Anti-Bribery Convention. In his speech, Peikin stressed the importance of the FCPA to the Commission’s enforcement mission and noted that the Commission will continue its commitment to FCPA enforcement. Pointing out that the Commission has brought 106 FCPA-related actions against individuals and corporations since forming its designated FCPA Unit in 2010, Peikin highlighted the Commission’s success in fostering a more predictable and uniform approach to FCPA enforcement and domestic and international partnerships in fighting corruption.
Peikin stressed the importance of collaborating with international colleagues in the fight to “eradicate[e] corruption and bribery” and pointed to recent global settlements, including the settlement with Telia (reported here), as examples of successful cross-border coordination and cooperation. Citing deterrence and investigation efficiencies as key benefits of global coordination, Peikin noted that he expects “the trend of the Enforcement Division working closely with foreign law enforcement and regulators in anti-bribery actions to continue its upward trajectory in the coming years.”
Peikin also emphasized the Commission’s focus on individual accountability, noting that the Enforcement Division considers it in every case it investigates. While acknowledging challenges in holding individuals accountable when the individuals are foreign nationals who reside overseas and have limited assets in the U.S., Peikin reiterated that individual accountability is “critical” to achieving the Division’s goals of deterrence, incapacitation, and just punishment. He stated that he expects the Commission “will continue to have intense focus on the question of individual responsibility in every FCPA investigation.”
Peikin also identified the interplay between the length of FCPA investigations and the statute of limitations as another principal challenge, particularly in light of the U.S. Supreme Court’s recent decision in Kokesh v. SEC (previously reported here), which held that the Commission’s claims for disgorgement are subject to the general five-year statute of limitations. While acknowledging the case’s impact on the Commission’s enforcement program, Peikin indicated, “[W]e have no choice but to respond by redoubling our efforts to bring cases as quickly as possible.”
Peikin’s speech suggests that the Commission may again ramp up its focus on FCPA enforcement actions, particularly with the recent appointment of Charles Cain as the new Chief of the FCPA Unit. However, recent statistics reflect that SEC enforcement actions have dropped significantly under the current administration. Cornerstone Research recently reported that the Commission’s enforcement actions against public companies were down 33% in fiscal year 2017, and that there was a significant drop in the second half of the year, from 45 actions in the first half of the year to 17 in the second half. So whether the Commission will actually execute on its promise to double down on FCPA enforcement remains to be seen. Nonetheless, one thing has not changed—companies remain well served by having a robust FCPA compliance program.