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Entries in Aon (15)

Thursday
Oct302008

A Word Of Thanks . . .

We're always thankful for Fridays, of course, but today ranks above others. Finally we can say goodbye to October 2008 -- a month that changed the world. We asked a friend for a favor last week. "What if I don't help you?" he said. "We'll tell everyone you're a banker," we answered. And he really is a banker, poor guy.

We're thankful too for the American political process. No kidding. However you vote, you have to admire what happens every four years. Our street-level democracy may be messy, tacky and shrill, but it's never dull. And the best part? It still works. How brilliant were the Founders?

With Bloody October over and the election passing into history next week, we expect a burst of news about the Foreign Corrupt Practices Act. Some big names to look for are Siemens (it has 29 appearances in this blog), Panalpina (19 appearances), the orthopedic device makers (9 appearances as a group and countless appearances on their own, as Biomet Inc., Stryker Corp., Zimmer Holdings Inc., Smith & Nephew plc, Medtronic Inc. and Wright Medical), Halliburton (9 appearances) and Aon Corporation (5 appearances). John Ashcroft, by the way, the heavyweight titleholder of compliance monitors, has 13 appearances.

A big danka shern (Wayne Newton's preferred spelling) to everyone who has ordered Bribery Abroad in hardcopy or by download, especially those who've taken the time to tell us they enjoyed the book (yo back to you, Mom).

And not least, a salute to the sponsors of the FCPA Blog, who have been more than generous with their support. A warm welcome today, by the way, to our newest sponsor, Daylight Forensic & Advisory. It joins our other sponsors with tangible aid and comfort for our efforts to keep the blog free-to-air, as they say. (Anyone interested in becoming a sponsor can contact us here.)

Enjoy the weekend.

.

Thursday
Jul102008

Heading For The Hammock

It's the weekend again. Good thing. We need (and deserve) some rest. What serious mind, after all, wouldn't be exhausted pondering how Tampa Bay can be one and a half games clear of the Red Sox? Strangely, our spouse seems to hold no opinion on the subject. So in our household the burden of the American League East falls entirely on our shoulders.

Still, we managed to cover some new ground this week. Iraq's civil suit against those implicated in the oil-for-food scandal caught our eye. And we noted the appeal to the House of Lords by Britain's Serious Fraud Office. We're not sure if the bigger scandal there involves BAE and Prince Bandar or the SFO itself.

What else? Oh yes -- we were wowed by the D&O Diary's trend-spotting. Looks like FCPA-inspired civil litigation is the next big hazard in the lives of our already-pummeled corporate leaders.

Meanwhile, we're waiting for the DOJ to deal with Panalpina. The global logistics firm may have stretched "facilitating payments" well beyond the current legal definition -- and in the process caused compliance headaches for practically everyone in the oil-and-gas services sector.

Siemens' hopes for a quick resolution in the U.S. of its massive corruption problems have now evaporated. Our first post about that company was back in September 2007, an eon ago in the life of a blog.

Speaking of eons . . .

Aon Corporation -- the giant insurance broker -- disclosed back in November 2007 an internal investigation into possible violations of the FCPA. When it self-reported to the DOJ it also agreed to toll the statute of limitations. So we guess no one's in a big hurry to wrap up that one.

The orthopedic device makers are waiting to learn their fate with the FCPA. We first wrote about the investigation by the DOJ and SEC into the group's overseas sales practices in October 2007. That post was also our first mention of John Ashcroft's appointment as a compliance monitor in a domestic bribery case for Zimmer Holdings.

The revelation that Mr. Ashcroft might take home $52 million from the appointment prompted our favorite blog editor emeritus, Prof Peter Henning, to note in his '07 Thanksgiving Day message: That's not a bad payday, and Zimmer -- like every other company that enters into a deferred or non-prosecution agreement -- can hardly object to the fees lest it look uncooperative and bring down the wrath of the U.S. Attorney's Office. So much to give thanks for this Thanksgiving.

Well, with the FCPA backlog still growing, we could keep at this for a long time. But our thoughts must now return to more weighty matters. That's right -- the mystery of the American League East.

Enjoy the weekend.

.

Thursday
Mar272008

Roll Call

It was just two weeks ago that we were waxing about the quiet times for FCPA watchers, due to the temporary bottleneck in the appointment of corporate monitors. But come to think of it, the Justice Department's Fraud Section, the group in charge of FCPA enforcement, has a lot on its mind right now.

In addition to the monitor controversy, there are sensitive investigations of BAE and Saudi Prince Bandar, along with Siemens, Panalpina and most of the oil and gas services industry. Giant insurance brokerage Aon announced an FCPA investigation. Medtronic is under the microscope with the rest of the leading orthopedic device makers (whose deferred prosecution agreements in their domestic bribery cases helped ignite the aforementioned controversy about corporate monitors).

Last week, even stolid Alcoa joined the FCPA line up, courtesy of an inexplicable federal civil suit filed against it by Bahrain's Alba (in Pittsburgh, of all places) -- which the DOJ promptly stayed while it plays investigative catch-up. And let's not forget that at least three dozen other companies have disclosed yet-unresolved FCPA investigations over the past few years -- Shell recently became one of them (see also Panalpina, above); Halliburton and DaimlerChrysler are two others. And there's Total, ABB, Bristol Myers Squibb, Tyco and . . . . well, it's a long list.

So it's not a quiet time over at the DOJ after all. That means the hardworking people there can be forgiven for little things, like gremlins making mischief on their FCPA Opinion Procedure Release website. Sometimes Releases disappear. This time, it's Release 08-01. When it was published earlier this year, we posted about it here, and it should be accessible as a pdf file here. As a reminder, Release 08-01 is the wordiest on record. It's about a proposed investment in an overseas privatization, and describes in detail the due diligence for the deal, protracted negotiations over the parties' compliance rights and obligations, and some final, remedial due diligence. In other words, it's packed with issues, action and guidance -- so it might come in handy.

Quiet times for the FCPA? Not nearly. In fact, when the dam breaks for the appointment of new corporate monitors, which should be any day now, we're expecting the busiest FCPA enforcement season ever.

Thursday
Mar132008

The FCPA Takes A Holiday?

It's been a quiet time here at the FCPA Blog. Not much to report -- which isn't a bad thing. We've had a chance to clean our desk, get our shoes shined, and pick on Wikipedia. On that score, we even had time to submit some edits for Wiki's FCPA article. Now we're biting our nails, waiting for the editorial lords to make a ruling on our hoped-for alterations.

Still, we're wondering why it's so quiet, why the Department of Justice hasn't announced a deferred prosecution agreement since Flowserve's on February 21? We know from various public disclosures that companies are standing in line. Faro Technologies, Inc. is one of them (see our post here). Aon Corporation could be another (see our post here), and there are more.

We're not sure why there seems to be a moratorium on FCPA settlements right now. But it could be linked to what's happening in Washington. As we mentioned yesterday, the U.S. House of Representatives' Subcommittee on Commercial and Administrative Law is holding hearings this week. The hearings have the moniker: "Deferred Prosecution: Should Corporate Settlement Agreements Be Without Guidelines?" And sparks are flying.

It's fair to say that all aspects of deferred prosecution agreements are in play. Media attention has focused on the corporate monitorships. That's due mainly to New Jersey U.S. Attorney Chris Christie's appointment of his former boss, ex-U.S. Attorney General John Ashcroft, as a monitor for orthopedic device maker Zimmer Holdings Inc. The case involves domestic bribery. Mr. Ashcroft's firm could make as much as $52 million from the appointment. Not surprisingly, that ignited the controversy that now engulfs every aspect of the monitorships and even the idea of deferred prosecution agreements.

While the storm blows on Capitol Hill, the DOJ can't be anxious to announce any new agreements and monitorships just yet. And no company would want to get caught in the political crossfire by being part of a fresh settlement, just as potential monitors wouldn't risk an appointment while the flap over Mr. Ashcroft et al is in the news.

All this is speculation, to be sure. Perhaps the DOJ will make a formal announcement about what's happening, or at least send out some smoke signals, to let everyone know if we're in for a long wait. Meanwhile, we're off to get a haircut, wash the car and catch some zzzzzzzzz. What a life!

Thanks to photo.jacko.com for the great picture.

Sunday
Nov112007

AON Discloses FCPA Investigation

It Has Already Agreed to Toll the Statute of Limitations; Will Self-Reporting Lead to More Waivers of Legal Protections?

Aon Corporation -- the world's biggest insurance broker -- disclosed on November 8, 2007 an internal investigation of possible violations of the U.S. Foreign Corrupt Practices Act and non-U.S. anticorruption laws. AON said in its latest Form 10-Q that it has self-reported the investigation to the U.S. Department of Justice, the Securities and Exchange Commission and others, and that it has already agreed with prosecutors to toll any applicable statute of limitations.

A standard feature of deferred prosecution agreements is a waiver of the statute of limitations for claims not already time barred. But an agreement to toll any applicable statute of limitations during an internal FCPA investigation is unusual. Did the DOJ ask for the waiver to protect itself against another legal setback like the one it suffered in the high-profile FCPA prosecutions of Victor Kozeny and his co-defendants, Frederic Bourke, Jr. and David Pinkerton? The three were on trial for an alleged scheme to bribe senior government officials in Azerbaijan to ensure the privatization of the state oil company. But in June 2007, the U.S. District Court for the Southern District of New York dismissed all FCPA and related counts against them because the five-year statute of limitations had run. The DOJ has appealed, saying the limitations period should have tolled automatically while prosecutors tried to collect evidence from foreign countries. Meanwhile, a court in the Bahamas ruled that Kozeny cannot be extradited to the U.S. on the dismissed FCPA charges.

We're speculating, but the DOJ must be anxious to avoid more statute of limitations problems in FCPA prosecutions. So will the government now routinely demand waivers of the statute of limitations defense at preliminary stages of self-reporting by corporations? Will it then use the responses to measure the corporations' level of "cooperation" under the U.S. Federal Sentencing Guidelines? And will there be an outcry against the practice, as there was against the DOJ's pressure on corporations to waive the attorney-client privilege or be labeled uncooperative for purposes of plea bargaining and sentencing?

Chicago-based Aon has 43,000 employees in 500 offices in more than 120 countries. Here is the complete FCPA disclosure from its quarterly report for the period ending September 30, 2007:

"Following inquiries from regulators, the Company commenced an internal review of its compliance with certain U.S. and non-U.S. anti-bribery laws, including the U.S. Foreign Corrupt Practices Act ('FCPA'). An outside law firm with significant experience in the area is overseeing the review. Aon has advised the U.K. Financial Services Authority, the U.S. Securities and Exchange Commission, the U.S. Department of Justice, and certain other non-U.S. regulators of the review and has agreed with the U.S. regulators to toll any applicable statute of limitations pending completion of the review. Based on current information, the Company is unable at this time to predict when the review will be completed or what regulatory or other outcomes may result."

Aon Corporation trades on the New York Stock Exchange under the symbol AOC.

View Aon's Form 10-Q for the period ending September 30, 2007 Here.

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