{"id":12396,"date":"2024-09-26T13:26:31","date_gmt":"2024-09-26T13:26:31","guid":{"rendered":"https:\/\/www.americanconference.com\/fcpa-dc\/?page_id=12396"},"modified":"2024-09-26T13:26:31","modified_gmt":"2024-09-26T13:26:31","slug":"fcpa-export-controls-and-sanctions-enforcement-adjusting-compliance-strategies-for-the-new-normal","status":"publish","type":"page","link":"https:\/\/www.americanconference.com\/fcpa-dc\/fcpa-export-controls-and-sanctions-enforcement-adjusting-compliance-strategies-for-the-new-normal\/","title":{"rendered":"FCPA, Export Controls, and Sanctions Enforcement: Adjusting Compliance Strategies for the New Normal"},"content":{"rendered":"
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By Jaclyn Jaeger<\/p>\r\n

Thursday September 26, 2024<\/p>\r\n<\/div>\r\n\r\n

As the interplay between export controls, trade sanctions, and anticorruption enforcement continues to intensify, multinational companies must remain vigilant in ensuring that their compliance programs address the many overlapping and ever-evolving regulatory risks across their global supply chain.<\/p>\r\n\r\n

This article will explore recent trends in the interplay between export controls, trade sanctions, and Foreign Corrupt Practices Act (FCPA<\/abbr>) enforcement; the enhanced coordination between enforcement agencies; and best practices for adjusting compliance strategies in this heightened regulatory environment.<\/p>\r\n \r\n

Sanctions: \u2018The new FCPA<\/abbr>\u2019<\/h5>\r\n\r\n

U.S. Deputy Attorney General Lisa Monaco repeatedly has stressed in public remarks over the past two years<\/a> that sanctions are \u201cthe new FCPA.\u201d More specifically, the scope of sanctions and export control enforcement that has followed Russia\u2019s invasion of Ukraine has reached, as Monaco described, \u201ca new order of magnitude.\u201d<\/p>\r\n\r\n

Sanctions risk is no longer limited to the banking sector alone, but rather \u201cshould now be at the top of every company\u2019s risk compliance chart.\u201d Since Monaco sounded that warning bell two years ago, several sectors have faced sanctions enforcement actions, including FinTech, tobacco, consumer goods, construction, transportation, defense, and agriculture.<\/p>\r\n\r\n

Sanctions and export controls enforcement surged both in case volume and penalty amounts. In 2023, the U.S. Department of the Treasury\u2019s Office of Foreign Assets Control (OFAC<\/abbr>) resolved 17 cases, amounting to a record $1.5 billion in penalties. The Department of Commerce\u2019s Bureau of Industry and Security (BIS<\/abbr>) also had a record enforcement year in 2023, imposing its highest number of convictions, temporary denial orders (TDOs<\/abbr>), and post-conviction denial orders.<\/p>\r\n\r\n

Adding to the enhanced enforcement landscape, the Department of Justice\u2019s (DOJ<\/abbr>) National Security Division (NSD<\/abbr>) last year onboarded its first chief counsel and deputy chief counsel<\/a>, tasked with coordinating and overseeing the NSD<\/abbr>\u2019s investigations and prosecutions of corporate crime on U.S. national security matters.<\/p>\r\n\r\n

These appointments are in addition to the more than 25 new prosecutors tasked with investigating and prosecuting economic crimes, including sanctions evasion and export control violations. These new hires \u201cwill work closely with U.S. attorneys\u2019 offices and the Criminal Division to apply enforcement strategies,\u201d Monaco remarked. Practically speaking, sanctions and export control violations involving bribery or corruption could also lead to FCPA<\/abbr> violations.<\/p>\r\n\r\n

Revised VSD<\/abbr> policies<\/h5>\r\n\r\n

Complementing heightened enforcement initiatives, the NSD<\/abbr> and the BIS<\/abbr> recently revised their voluntary self-disclosure (VSD<\/abbr>) policies to incentivize the reporting of export controls and sanctions violations.<\/p>\r\n\r\n

The NSD\u2019s revised VSD policy<\/a>, issued in March 2024, states that when a company voluntarily self-discloses potentially criminal violations to NSD<\/abbr> \u2013 and no other agency \u2013 \u201cwithin a reasonably prompt time after becoming aware\u201d of potential violations, fully cooperates, and \u201ctimely and appropriately\u201d remediates, NSD<\/abbr> \u201cgenerally will not seek a guilty plea, and there is a presumption that the company will receive a non-prosecution agreement and will not pay a fine.\u201d<\/p>\r\n\r\n

According to the NSD<\/abbr>, aggravating factors that could result in a more stringent resolution include:<\/p>\r\n