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SPONSOR INFORMATION
1. Sponsor Number: 18725
2. Name and address of organization providing or sponsoring the activity (not the name of person applying).
CLE Companion, P.O. Boc 160411, Austin TX 78746
3. Website: www.clecompanion.com
4. Name of sponsor contact person: 5. Telephone Number: 6. Email Address:
Kristin Davidson 512-677-4443 [email protected]
ACTIVITY INFORMATION
7. Title of Activity: Understanding the Foreign Corrupt Policies Act of 1977

8. Live Technology:
Date(s) Live Technology Program Held? 6/6/22
Methods of Delivery: (please check all that apply): ✔ Live Webcast Teleconference Videoconference
Other

9. Prerecorded Technology:
Production Date of Original Program: 6/6/22
Date(s) On-Demand Program Available: 6/7/22
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Mp3 Mp4 Audio/Video CD/DVD Other

10. Has the sponsor developed a method of evaluation for this activity? ■ Yes No
Please note that a method of evaluation is required for the Activity to be eligible for CLE accreditation.

11. Are course materials provided to attendees? ■ Yes No Total Number of Pages: 28
When are materials distributed? Before Program At program ✔ Electronic Other, please explain

REQUIRED DOCUMENTATION
12. All information requested MUST BE PROVIDED ON THIS FORM.

• Attach a copy of the brochure/program schedule.

• Provide evidence that the run time of the activity is an amount of time equivalent to the number of CLE hours requested.
• Announcement of each CLE activity shall be filed no later than thirty days after the first presentation of an activity.
TOTAL HOURS REQUESTED
13. Please state the total hours of instruction for which you are requesting CLE credit, excluding opening and closing remarks
and breaks:

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Print Form
 Understanding the FPCA Act of 1977
Presented by: Marcos Daniel Jimenez, Derek Leon and John Bryne of Leon Cosgrove, LLP

1. FPCA Introduction
a. Common Misconceptions
b. Increased Enforcement

2. The Statute
a. Anti-Bribery Provision
b. Accounting and Internal Controls
3. Anti-Bribery Provision

a. Prohibitions
i. Corruptly paying or offering to pay
ii. Determining value
iii. Direct or indirect?
b. Inclusions
c. Specifics & Hypotheticals
d. Third Party Risks
e. Exceptions
f. Affirmative Defenses
g. FCPA Penalties, Sanctions and Remedies
h. High Risk Jurisdictions
i. Accounting Requirements
j. DOJ Opinion, procedures

4. Closing Remarks
Provider Name: CLE Companion
Title: Understanding the Foreign Corrupt Policies Act of 1977
Presented by: Marcos Daniel Jiminez, Derek Leon, John Bryne
Date of Live Stream: April 06, 2022
Time of CLE Presentation: 12:00 PM EDT
Course Length: 60 Minutes
Course Specialization: Ethics

Course Description:
Congress passed the Foreign Corrupt Practices Act (FCPA) in 1977 in response to
revelations of widespread bribery of foreign officials by U.S. companies.
In the wake of the Watergate scandal, SEC investigations uncovered 400 U.S.
companies admitting to making over $300 million in illegal payments to foreign
government officials, politicians, and political parties. The companies included some of
the largest public companies in the country, over a quarter in the Fortune 500.

The FCPA was created to halt those corrupt practices and restore public confidence in
the marketplace. This course will provide a deep dive into the FCPA statute, provisions,
defenses, and penalties.

Presenters Biography:

Marcos Daniel Jiménez is a prominent trial lawyer with a proven track

record of success in complex business litigation and white-collar
criminal defense matters Marcos previously served as the United
States Attorney for the Southern District of Florida, leading
approximately 230 prosecutors in an active and important region for
federal criminal cases.

Chambers USA has described Marcos as “a great trial lawyer, fearless

in the courtroom, which makes him a dangerous opponent The
National Law Journal featured him in its annual “ issue for
his trial victory on behalf of Verizon Wireless in a deceptive trade
practices case brought by the Florida Attorney General In addition to
maintaining a thriving legal practice, Marcos is an active community
and bar leader He previously served on the Board of Trustees of
Baptist Health Systems, Florida’s largest nonprofit healthcare
organization.

Marcos graduated in the top one percent of his class at the University
of Miami School of Law and is a member of Iron Arrow, the
University’s highest honor.

Derek E León
Derek E León is a founding partner of Leon Cosgrove, with 25 years of
experience representing Fortune 500 companies in large
complex business disputes in a variety of industries Before
starting the firm with Scott Cosgrove, Derek was an equity
partner at Morgan Lewis Bockius. There, he served as co-chair
of the Firm’s Global Retail Practice Group In 2012 he was also
asked to head the Firm’s Litigation Practice Group in Florida a
position he declined in order to start León Cosgrove.
Derek is praised in Chambers USA for his “wide range of litigation and
trial skills” including his “excellent sense of strategy” and oral
advocacy skills He has been recognized nationally as one of the
top 30 Corporate Influentials in the US by Hispanic Business
Magazine and has handled complex business disputes,
including class action work, in over 200 jurisdictions across the
US.

John Bryne

Mr. Byrne specializes in the litigation of complex commercial

transactions and consumer fraud matters on behalf of both
plaintiffs and defendants.

Prior to joining León Cosgrove, he was an Assistant United

States Attorney for the Southern District of Florida During his
time at the US Attorney’s Office, Mr. Byrne charged over 60
cases, including numerous fraud cases He took 16 of these
cases to trial, serving as first chair ten times and second chair six
times During his time as a prosecutor, he developed an
extensive knowledge of federal law, including federal statutory
law, the Federal Rules of Evidence, and the Federal Rules of
Criminal Procedure.

Mr. Byrne also has extensive federal appellate experience In

addition to having argued a case before the US Court of
Appeals for the Eleventh Circuit, he served as the law clerk to
Chief Judge Jeffrey R Howard of the US Court of Appeals for
the First Circuit.

Compliance Information:
Downloadable supplemental materials are available to all attendees. Materials include
course outline, course application for self-accreditation, presenter bio, and any
additional course material deemed necessary by the presenter.

This course is offered at www.clecompanion.com and is advertised through various

online means such as Email and Social Media.
Attendance is monitored by time in session and polling codes. We require a 7 question
course evaluation to be completed at the end of the course. We retain course
evaluations for a period of 3 years following the course. The system will not generate a
certificate until the time is verified, the polling codes are entered, and the course
evaluation is completed. (Course evaluation questions are available upon request.)

Our Question and Answer session is conducted after the presentation via direct
communication between the presenter and the attendee. The presenter has agreed to
answer any reasonable requests for additional information within a 3-year period from
the date of the presentation.

Provider Information:
Contact Person: Kristin Davidson, CEO
Direct: 512-677-4443
Toll-Free: 1-877-670-2520
Email: [email protected]; [email protected]
 Understanding
the
Foreign Corrupt Practices Act (FPCA)
 OUR TEAM
MARCOS DANIEL JIMÉNEZ

Marcos Daniel Jiménez is a prominent trial lawyer with a proven track

record of success in complex business litigation and white-collar
criminal defense matters. Marcos previously served as the United
States Attorney for the Southern District of Florida, leading
approximately 230 prosecutors in an active and important region for
federal criminal cases.

Chambers USA has described Marcos as “a great trial lawyer, fearless

in the courtroom, which makes him a dangerous opponent.” The
National Law Journal featured him in its annual “Winning” issue for
his trial victory on behalf of Verizon Wireless in a deceptive trade
practices case brought by the Florida Attorney General. In addition to
maintaining a thriving legal practice, Marcos is an active community
and bar leader. He previously served on the Board of Trustees of
Baptist Health Systems, Florida’s largest nonprofit health care
organization.

Marcos graduated in the top one percent of his class at the University
of Miami School of Law and is a member of Iron Arrow, the
University’s highest honor.
 OUR TEAM
DEREK E. LEÓN

Derek E. León is a founding partner of the firm, with 25 years of

experience representing Fortune 500 companies in large
complex business disputes in a variety of industries. Before
starting the firm with Scott Cosgrove, Derek was an equity
partner at Morgan Lewis & Bockius. There, he served as co-chair
of the Firm’s Global Retail Practice Group. In 2012, he was also
asked to head the Firm’s Litigation Practice Group in Florida – a
position he declined in order to start León Cosgrove. Derek is
praised in Chambers USA for his “wide range of litigation and
trial skills” including his “excellent sense of strategy” and oral
advocacy skills. He has been recognized nationally as one of the
top 30 Corporate Influentials in the U.S. by Hispanic Business
Magazine, and has handled complex business disputes,
including class action work, in over 200 jurisdictions across the
U.S.
 OUR TEAM
JOHN R. BYRNE

Mr. Byrne specializes in the litigation of complex commercial

transactions and consumer fraud matters on behalf of both
plaintiffs and defendants.

Prior to joining León Cosgrove, he was an Assistant United

States Attorney for the Southern District of Florida. During his
time at the U.S. Attorney’s Office, Mr. Byrne charged over 60
cases, including numerous fraud cases. He took 16 of these
cases to trial, serving as first chair ten times and second chair six
times. During his time as a prosecutor, he developed an
extensive knowledge of federal law, including federal statutory
law, the Federal Rules of Evidence, and the Federal Rules of
Criminal Procedure.

Mr. Byrne also has extensive federal appellate experience. In

addition to having argued a case before the U.S. Court of
Appeals for the Eleventh Circuit, he served as the law clerk to
Chief Judge Jeffrey R. Howard of the U.S. Court of Appeals for
the First Circuit.
Poll Code 1: ATX

Poll Code 2: CCD

 FCPA INTRODUCTION

➢ Congress passed the Foreign Corrupt Practices Act (FCPA) in 1977 in response to revelations
of widespread bribery of foreign officials by U.S. companies.

➢ In the wake of the Watergate scandal, SEC investigations uncovered 400 U.S. companies
admitting to making over $300 million in illegal payments to foreign government officials,
politicians, and political parties.

The companies included some of the largest public companies in the country, over
a quarter in the Fortune 500.

➢ The FCPA was created to halt those corrupt practices and restore public confidence in the
marketplace.
 FCPA INTRODUCTION

➢ Common misconception regarding enforcement between 1978 and 2003

➢ Uptick in enforcement since 2004

• More international business

• More foreign companies with shares listed on a U.S. exchange

• 1998 Amendment broadening anti-bribery provisions

• The passage of Sarbanes Oxley in 2002

 THE STATUTE

FCPA contains two primary provisions:

(1) An anti-bribery provision

(2) Accounting and internal control requirements

 ANTI-BRIBERY PROVISION
The FCPA anti-bribery provision prohibits:

▪ Corruptly paying or offering to pay

▪ anything of value
▪ to a foreign official
▪ directly or indirectly,
▪ to:
o secure an improper advantage;
o influence a foreign official in his official capacity;
o induce him to violate the law; or
o induce him to use his influence within a foreign government to affect the government’s acts, in
order to assist in obtaining or retaining business

(Note: The statute does not define “corruptly” but the Senate indicated that it intended “to make clear that
the offer, payment, promise, or gift must be intended to induce the recipient to misuse his official position in
order to wrongfully direct business to the pay of his client. DOJ has advised that the FCPA does not require
the corrupt act to succeed; the offer is enough.)
 ANTI-BRIBERY PROVISION

The FCPA anti-bribery provision prohibits:

▪ “anything of value”

▪ 2015 Bank of New York Mellon settlement with the SEC

▪ BNY Mellon paid $14.8 million to the SEC

▪ What was the thing of value?

 WHO IS COVERED BY THE ANTI-BRIBERY PROVISION

The Act’s anti-bribery provision applies to practically any U.S. corporation and any foreign
company doing substantial business in the United States.

-Issuers

-Domestic concerns

-Certain persons and entities, other than issuers and domestic concerns, acting
while in the territory of the United States.
 WHO IS COVERED BY THE ANTI-BRIBERY PROVISION

Specifically, the Act covers:

1. any company required to file reports under the SEC;

2. all foreign companies whose stock is traded on U.S. exchanges;

3. any U.S. citizen;

4. any business entity organized under the laws of a state in the United States or with a
principal place of business in the United States
 EXAMPLES OF FOREIGN OFFICIALS
1. Physicians and laboratory personnel
2. Steel mill managers
3. Airport employees
4. Engineers and purchasing officers of power generation companies
5. Telecommunications company employees
6. Hotel and convention center construction executives
7. Airline officials

(Note: FCPA prohibits payments to foreign officials not foreign governments. That said,
companies contemplating contributions or donations to foreign governments should take
steps to ensure no monies are used for corrupt purposes, such as the personal benefit of
foreign officials.)
 THIRD PARTY RISKS
• FCPA imposes liability on a company for making payments to a third party while “knowing”
that the third party will make a corrupt payment in violation of the Act.

• Third Parties: Local subsidiaries, brokers, joint ventures, consultants, agents,

distributors, and brokers

• “Knowing” means that a person in the company is aware that the third party is engaging in
prohibited conduct or that the prohibited conduct is substantially certain to occur.

• Actual knowledge is not required

• Conscious disregard of “high probability” that prohibited payment will occur =

“knowing”

United States v. Kozeny, 667 F.3d 122, 130 (2d Cir. 2011)
 THIRD PARTY RISKS

• 2014 DOJ settlement with Alcoa World Alumina LLC

• Paid $223 million in criminal fines and forfeiture

• DOJ alleged that Alcoa paid millions of dollars in bribes through an international middleman
in London to officials of the Kingdom of Bahrain

• Alleged that Alcoa supplied aluminum at marked up prices to a “consultant” as a way to pay
kickbacks to government officials.

United States v. Kozeny, 667 F.3d 122, 130 (2d Cir. 2011)
 EXCEPTIONS TO THE ANTI-BRIBERY PROVISION

1. “Facilitating payments” made to expedite or secure routine government action are

permitted.

2. Local written law permits the so-called prohibited activity.

3. Bona fide expenditures related to the promotion or demonstration of goods or services

or to the execution or performance of the contract with a government or government
agency

(Companies should be aware that other statutes may apply to the same conduct that the FCPA
exempts. E.g. Mail and wire fraud statutes and the Travel Act)
 AFFIRMATIVE DEFENSES

Two affirmative defenses:

1. Local law defense: “[T]he payment, gift, offer, or promise of anything of value
that was made, was lawful under the written laws and regulations of the
foreign official’s, political party’s, party official’s, or candidate’s country.”
2. Bona fide expenditures

a. DOJ Guidance: (i) selection of participants; (ii) pay costs directly; (iii) no
advancements; (iv) necessary and reasonable; (v) transparency; (vi) no
strings.
 GIFTS, ENTERTAINMENT, TRAVEL AND HOSPITALITY

1. Gifts
2. Meals and entertainment

a. Hypothetical 1

b. Hypothetical 2
 FCPA PENALTIES, SANCTIONS, AND REMEDIES
Violations can have significant financial consequences:

1. Disgorgement of company profits

2. Up to $2 million fine for anti-bribery violations
3. Individuals (officers, directors, stockholders, and agents) subject to $250,000 fine and 5
years imprisonment (up to 20 years for willful violations of anti-bribery provisions)
4. Up to $25 million fine for accounting violations
5. Individuals subject to a fine of up to $5 million and 20 years imprisonment
6. Alternative Fine Act can increase fines to twice the financial gain or loss resulting from the
corrupt payment
7. Companies may be disqualified from doing business with the U.S. government and lose
their export license

United States v. Esquenazi, 752 F.3d 912, 918 (11th Cir. 2014)
 HIGH RISK JURISDICTIONS

Certain jurisdictions pose especially high risk for purposes of FCPA compliance:

1. China

2. Russia, Eastern Europe, and Central Asia

3. The Middle East

4. Latin America
 ACCOUNTING REQUIREMENTS
FCPA requires “issuers” (company that has securities registered in the United States or is
required to file reports with the SEC) to make and keep books and records “in reasonable
detail” that “accurately and fairly reflect the transactions and dispositions” of a company’s
assets.

For criminal liability to accrue under the accounting provisions, a person must “knowingly”:

1. Falsify a book, record, or account, or

2. Fail to implement a system of internal accounting controls.

(the accounting provisions are designed to operate in tandem with the anti-bribery provisions
of the FCPA. Provide a hook for the SEC to pursue companies and executive who failed to
detect foreign bribery).
WHAT DOES DOJ CONSIDER WHEN DECIDING WHETHER
TO OPEN AN INVESTIGATION OR BRING CHARGES?

DOJ principles of federal prosecution

DOJ principles of federal prosecution of business organizations

DOJ FCPA corporate enforcement policy

 DOJ OPINION PROCEDURE

• First, must concern prospective, non-hypothetical conduct;

• Second, entity seeking public opinion must be issuer or domestic concern;

• Third, request for opinion must be in writing and include all material information;

• Fourth, request must be signed by appropriate senior official and must certify that
content is true, correct, and complete;

• Fifth, company must comply with technical requirements.

• Within 30 days, DOJ will issue an opinion.

• Why do it?
CLOSING REMARKS