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Know-Your-Customer Controls a Key to FCPA Compliance, Says Former Justice Official
printAs global efforts to crack down on bribery grow, financial institutions need to more closely scrutinize the accounts they maintain for politically-tied figures, according to Vasu Muthyala, a former senior assistant U.S. attorney in the Justice Department's fraud and public corruption section. Keeping the accounts may mean that banks are "exposing themselves to a lot more risk than they need," said Muthyala, who helped prosecute businesses for violating the Foreign Corrupt Practices Act (FCPA). While banks and their employees have been the target of few FCPA prosecutions to date, they will likely face more scrutiny in the near future, he...
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To Comply With Anti-Bribery Law, Banks Must Be Careful with Payments for Licenses, Sovereign Clients
As prosecutors continue to accuse companies and individuals of foreign bribery, banks should be cautious about how they acquire licenses and sovereign wealth accounts, and where their clients send money abroad, say consultants.
The U.S. Justice Department's long-awaited guidance for businesses complying with a foreign anti-bribery law will do little to change its enforcement even as it sets some minds at ease, say attorneys.
Pending U.S. guidance for the country's foreign anti-bribery law and an ongoing political push to amend its rules could mean compliance changes for banks and other businesses, say analysts.
Since its inception, some of the country's top corporations have asked lawmakers to scale back the reach of the Foreign Corrupt Practices Act, which prohibits bribing foreign officials in conjunction with business deals, with one notable absence: the banking lobby.
U.S. Justice Department investigations of foreign bribery will likely end up snaring financial institutions, according to the former head of the government's anti-corruption unit.
The departure Friday of the Justice Department's top enforcer of the U.S. Foreign Corrupt Practices Act will mark an end to an era, not a slowdown in penalties against violators, say analysts.
The rise in U.S. prosecutions of companies that bribe foreign officials won't likely plateau for another four or five years, when European countries are expected to further clamp down on the crime, according to the former assistant chief for the Fraud Section of the Justice Department.
A British anti-bribery bill expected to pass this month could increase the likelihood that U.S. financial institutions and other companies will face sizable monetary penalties for overseas deals, say consultants.
The U.S. Justice Department nets 22 suspects in its largest ever investigation into individuals for FCPA violations, and FinCEN issues a ruling on whether domestic bill payment services companies are MSBs, in this week's roundup.
Banks and other companies around the world are delaying deals in developing markets, in some cases canceling projects altogether, because they are afraid of being snared by anti-corruption laws, according to a private survey released today.
The number and size of fines levied annually against financial institutions and other corporations for bribery is likely to continue to rise as the global recession fuels corruption, say analysts.
Financial institutions are increasingly renegotiating or dropping planned business deals over concerns that they might violate U.S. anti-bribery laws, according to a survey released Monday.
Financial institutions would be wise to make use of a recently published list of individuals and companies restricted from doing business with the World Bank, say compliance professionals.
The U.S. Justice Department entered into 60 percent fewer pre-trial agreements with corporations seeking to avoid criminal prosecutions in 2008 than in the previous year, according to a study released Friday.
With an increased focus on fraud and corruption investigations, financial institutions can't afford to silo their separate compliance efforts, according to Jane Wexton, president of Wexton Advisors, a New York-based consultancy.
Defendants in an international bribery case have asked the U.S. Supreme Court to review a case that could alter the way that the U.S. Justice Department enforces an international anti-corruption law, according to legal analysts.
The United States is likely to ramp up penalties against financial institutions and other companies that have bribed Chinese officials to gain entry into the Asian market, including business involving the Olympics, say consultants.
With the Justice Department and SEC taking a more aggressive approach to enforcing the act, there has been a dramatic increase in investigations and enforcement actions, lawyers and compliance professionals say. Many of the violations are associated with money laundering cases.