James Tillen Discusses 2015 FCPA Enforcement Trends in The FCPA Report
"James Tillen of Miller & Chevalier Talks 2015 Enforcement Trends and Predictions"The FCPA Report
In a question and answer session, James Tillen discusses the impact of 2015 FCPA enforcement trends on company compliance programs and negotiation strategies with the government and offers predictions for the second half of 2015. "One of the most notable trends is the increased focus on declinations. I think the [Department of Justice (DOJ)] is being more judicious in the actions it pursues. When a company does the right thing with regard to self-reporting and cooperation, it is in a better position to get a declination than perhaps in prior years," Tillen said. The increased focus of DOJ declinations can impact a company's strategy when a violation occurs. "It makes the voluntary disclosure calculus more informed. Historically, the uncertainty surrounding self-reporting made many companies dubious about whether voluntary disclosure was in their best interest," he said. "The new emphasis on declinations might make the decision to self-report easier -- if a company at least has a chance of declination, self-reporting is more palatable."
With respect to recent actions concerning the government's usage of books and records provisions to pursue violations, Tillen said these "have always been the Achilles' heel of companies. Even where the elements of an anti-bribery violation are not met, the books and records and internal controls provisions are still available to the government." The interpretation of what is covered by the internal controls provisions is rather vague, as the statute speaks only to internal accounting controls, however the government frequently interprets FCPA compliance programs as a component of internal controls, regardless of whether they apply to accounting or not. "Logically, are internal accounting controls the same as third-party due diligence or some of the other parts of an FCPA compliance and training program? No," Tillen said. "Yet, the [Securities and Exchange Commission] often finds inadequate compliance programs to be grounds for an internal controls violation. That is a pretty broad interpretation."