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Anti-Bribery/Anti-Corruption

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On July 29, 2020, US District Judge Nathaniel M. Gorton sentenced Hercules Capital, Inc. Founder Manuel Henriquez to six months in prison for his part in the “Varsity Blues” college admissions scheme.[1] In addition to the six-month term, Judge Gorton also ordered Henriquez to complete 200 hours of community service and pay a $200,000 fine.[2] Henriquez’s sentence is one month less than that of his wife, Elizabeth Henriquez, who received a seven-month sentence on March 31, 2020.[3] Manuel Henriquez, who pled guilty on October 21, 2019,[4] is the 16th parent sentenced, and the last of four parents federal prosecutors dubbed “the most culpable parents charged.”[5]

Manuel Henriquez’s Conduct

Prosecutors alleged Henriquez and his wife paid William “Rick” Singer nearly $50,000 to facilitate cheating on their two children’s college entrance exams.[6] According to prosecutors, the Henriquezes cheated on more standardized test than any other co-conspirator: twice for their oldest daughter and three times for their youngest daughter.[7] Prosecutors also alleged that the Henriquezes paid Singer $400,000 in bribes to get their oldest daughter into Georgetown as a fake tennis recruit in 2016, and that Manuel Henriquez agreed to use his position as a prominent alumnus and former Member of the corporation at Northeastern University to advocate for the admission of one of Singer’s other students.[8]…

Continue Reading Federal Judge Sentences Financier to Six Months in Varsity Blues Scandal

On July 3, the US Department of Justice (DOJ) and Securities and Exchange Commission (SEC) issued the second edition of the Resource Guide to the US Foreign Corrupt Practices Act (the 2020 Guide), the first full-scope overhaul of the Resource Guide since its issuance in 2012. As with the original edition, the 2020 Guide…

Institutions of Higher Education are increasingly finding themselves in the crosshairs of high-profile criminal enforcement efforts. Recent headlines have highlighted a number of investigations and prosecutions that have achieved literal celebrity status:

  • The indictments and convictions of wealthy parents of college applicants in the Varsity Blues investigation, who are alleged to have paid bribes in

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The Second Circuit’s latest opinion in the FIFA bribery investigation – United States v. Napout (United States v. Napout, Nos. 18-2750 (L), 18-2820 (Con), __ F.3d__, 2020 WL 3406620 (2d Cir. June 22, 2020)) – wades into the murky waters of the extraterritorial reach of US fraud statutes and the inherent ambiguity continuing to plague the so-called right to “honest services.”

The US government’s expansive interpretation of its jurisdiction under various fraud statutes in cases involving only minimal, attenuated, links to US territory through US electronic mail systems, cellular phone networks, and bank wire transfers, coupled with the ubiquity of these facilities in modern commerce, substantially increases the risk that foreign entities and individuals may be forced into US criminal investigations.

The Second Circuit’s opinion in Napout, which was deferential to the district court’s findings, leaves room for future courts to reach a different outcome in similar cases.…

Continue Reading The FIFA Bribery Case: US Jurisdiction Over Predominantly Foreign Conduct?

On June 22, the US Supreme Court weighed in on a question it explicitly left open in Kokesh v. SEC – whether, and to what extent, the Securities and Exchange Commission (SEC) in a civil enforcement action may seek “disgorgement” as “equitable relief that may be appropriate or necessary for the benefit of investors” under…

Remarkably, we issued the advisory notice below a decade ago to serve as a guide for avoiding and managing the most sensitive matters before increasingly ambitious US state prosecutors – guidance that, following years of public corruption, pay-to-play and other high-profile financial matters, particularly in New York and California, is every bit as apt now…

On May 20, 2020, panelists from the DOJ, SEC, and FBI participated in a virtual town hall to discuss the state of play of FCPA and healthcare fraud enforcement as the United States and the rest of the world navigate the wide-ranging challenges wrought by the COVID-19 pandemic.

Government panelists included:

  • Robert Zink (Chief of the Fraud Section, Criminal Division, DOJ);
  • Daniel Kahn (current Senior Deputy Chief of the Fraud Section, and former FCPA Unit Chief, DOJ);
  • Joe Beemsterboer (current Senior Deputy Chief of the Fraud Section, and former Chief of the Health Care Fraud Unit, DOJ);
  • Charles Cain (Chief of the FCPA Unit of the SEC’s Division of Enforcement); and
  • Leslie Bakschies (Unit Chief at the FBI).

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Continue Reading Key Investigation and Compliance Take-Aways from May 20, 2020 DOJ, SEC, and FBI Joint Town Hall Discussing FCPA and Healthcare Fraud Enforcement Efforts During COVID-19 Emergency

Steptoe partners Lucinda Low and Brittany Prelogar co-authored the chapter “Incentives for Self-Reporting and Cooperation” in Negotiated Settlements in Bribery Cases: A Principled Approach. This book, written by legal and policy professionals and academics, and published by Edward Elgar Publishing, analyzes the benefits and challenges of negotiated settlements as an enforcement mechanism in bribery…

Patrick Linehan, Zoe Osborne, Brittany Prelogar, Katherine Dubyak, and Jefferson Klocke co-authored an article titled “Considerations For Conducting Remote Internal Investigations” for Law360. The article, published April 3, discusses some of the legal and practical considerations in conducting remote investigations as the world grapples with containing the spread of COVID-19.

On February 26, 2020, the US District Court for the District of Connecticut partially overturned the jury conviction of Lawrence Hoskins in United States v. Hoskins, acquitting the defendant of all Foreign Corrupt Practices Act (FCPA) counts. In doing so, the court found that the government had failed to demonstrate as a matter of law that Hoskins, a British citizen, had acted as an “agent” of Alstom Power Inc. (API), a US-based subsidiary of French multinational corporation Alstom S.A. (Alstom), and a “domestic concern” for purposes of FCPA jurisdiction. This ruling is the latest twist in a case that has dealt a series of blows to the DOJ’s expansive assertion of FCPA jurisdiction over foreign defendants. As described below, however, the DOJ still has a number of tools available to prosecute non-US defendants involved in foreign corruption.
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Continue Reading The FCPA’s Arm Remains Long: Recent Developments in FCPA Jurisdiction over Non-US Defendants