Anti-Corruption & Compliance Blog

With the first half of 2019 in the rearview mirror, it is a good opportunity to review the overall trends in Foreign Corrupt Practices Act (“FCPA”) enforcement actions brought by the Department of Justice (“DOJ”) and Securities and Exchange Commission (“SEC”) so businesses can better anticipate what to expect in the future.  The following summarizes the key statistics and trends seen so far this year:

• The government filed 20 enforcement actions in the first half of 2019, which represents about a 25% increase in the average number of actions filed in the first half of a year.
• Mid-year enforcement sanctions were significantly above average at more than $1.4 billion.  The ten-year average is closer to $6 million at this point in the year. Much of this increase is due to three first quarter resolutions with Cognizant Technology Solutions Corporation, Mobile TeleSystems Public Joint Stock Company, and Fresenius Medical Care AG & Co. KGaA, totaling $1.1 billion paid by the settling companies.
• Only two entity groups disclosed new investigations this year—Uber Technologies, Inc. and Baker Hughes, a GE Company, LLC—which is well below the ten-year average of 13 disclosures.  Notably, the 2018 yearly totals were also substantially below average.
• During the second quarter, the DOJ and SEC collectively resolved investigations into seven different entity groups, three of which were closed without taking further action.

The Government is on a Record-Breaking Sanction Total Pace

In short, these statistics reveal that the government is on track to reach record-breaking sanction totals for FCPA-related enforcement actions this year. Not only are enforcement actions on the rise, they are also resulting in unusually large penalties.  By comparison, the overall number of investigations seems to be sharply declining, which may lead to fewer enforcement actions over the coming years as those investigations play out. We will continue to monitor these trends.