Hey, declinations WITHOUT disgorgement are still popular too
Friday, September 8, 2017 at 8:18AM
Richard L. Cassin in Declinations, Disgorgement, Pilot Program

There have been seven declinations under the DOJ's Pilot Program since it launched in April 2016. The most recent one was in June this year involving CDM Smith Inc.

The Pilot Program gives companies incentives to self-disclose FCPA violations, and to cooperate, remediate, and disgorge. Companies that qualify can receive a 50 percent discount on fines they might face under the U.S. Sentencing Guidelines.

Of the seven declinations so far under the Pilot Program, four involved non-Issuers (privately held companies) not subject to SEC jurisdiction.

The DOJ required those non-issuers --  HMT LLC, NCH Corporation, Linde North America Inc., and CDM Smith -- to disgorge tainted profits to the U.S. Treasury. That hadn't happened before. So a new category of FCPA enforcement actions was created, declinations with disgorgement.

Because declinations with disgorgement are new, they're attracting a lot of attention and healthy debate.

But plenty of traditional declinations are still happening. During July and August this year, five companies announced declinations from the DOJ or SEC or both, none of them under the Pilot Program.

The five companies that announced non-Pilot Program declinations in July and August, according to FCPA Tracker, were IBM, Newmont Mining, Net1, MTS Systems, and Vantage Drilling.

In the first half of 2017, eight other companies had disclosed non-Pilot Program declinations.

That means 13 companies in 2017 so far have received non-Pilot Program declinations.

In 2016, when the Pilot Program first appeared, there were a total of 12 declinations. Three of those were issued under the Pilot Program. The other nine were traditional (non-Pilot Program) declinations.


Richard L. Cassin is the publisher and editor of the FCPA Blog.

Article originally appeared on The FCPA Blog (http://www.fcpablog.com/).
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