DOJ Announces It Will Extend FCPA "Pilot Program"

The Department of Justice, Fraud Section’s guidance for Foreign Corrupt Practices Act investigations and prosecutions, commonly referred to as the “Pilot Program,” will remain in place when the one-year pilot period ends on April 5.  The extension was announced on March 10, 2017 by Acting Assistant Attorney General Kenneth A. Blanco in a speech at the American Bar Association’s National Institute on White Collar Crime.  Blanco explained that when the Pilot Program expires, the DOJ will evaluate its “utility and efficacy” to determine “whether to extend it, and what revisions, if any, we should make to it” and stated that “[t]he program will continue in full force until we reach a final decision on those issues.”

The DOJ launched the Pilot Program in April 2016 to “promote greater accountability for individuals and companies that engage in corporate crime by motivating companies to voluntarily self-disclose FCPA-related misconduct, fully cooperate . . . , and, where appropriate, remediate flaws in their controls and compliance programs.”  To achieve these objectives, the DOJ allocated greater resources to FCPA investigations and prosecutions.  The Pilot Program also set forth requirements for voluntary self-disclosure, cooperation, and remediation in FCPA cases.  Companies that meet these requirements are eligible to receive outright declinations or reduced fines and penalties. read more »

Bombardier officials suspected of bribery arrested in Sweden

A Russian employee in the Swedish offices of plane and train maker Bombardier has been detained in pretrial custody for two weeks on suspicion of aggravated bribery, a Swedish prosecutor said Friday.

Thomas Forsberg said Evgeny Pavlov, a Russian national living in Stockholm, was one of several Bombardier employees “suspected to have been colluding” with Azerbaijan railway authorities “in order to adapt a contract” to fit Bombardier.

Forsberg said Pavlov worked with Bombardier Transportation Sweden AB. On LinkedIn, Pavlov described himself as “Head of sales, Marketing and Country co-ordinator for the north region.”

Pavlov was ordered held in pretrial custody to prevent him from fleeing or tampering with evidence. Two others were briefly detained during the week but were released, Forsberg told The Associated Press. Both remain suspects while the investigation continues. Formal charges have not yet been made.

Forsberg said emails seized in October 2016 during a search of Bombardier offices in Sweden were considered evidence in the case.

He said that the suspicion was that Azerbaijani officials co-operated with Bombardier (TSX:BBD.B), which is headquartered in Montreal, to “receive rewards for having favoured the Bombardier contract.” read more »

 

South Korea looking into share trading of 13 companies ahead of election

South Korea is looking into share trading of 13 companies which are believed to be linked to possible presidential candidates ahead of an election in two months, the country's financial watchdog said on Monday (March 13).

The Financial Supervisory Service (FSS) said it is investigating whether there may have been speculation in shares in eight firms which are thought to be linked to possible candidates and is looking into five others ahead of an official inquiry.

There could be more as the election date approaches, a senior FSS official said, declining to be identified as he was not authorised to speak to media.

"Due to swift changes in the political situation inside the country and as presidential candidates emerge, the possibility of unusual politics-related stock movements has grown," the FSS said in a statement. read more »

Kushners Set to Get $400 Million From Chinese on Marquee Tower

A company owned by the family of Jared Kushner, President Donald Trump’s son-in-law and senior adviser, stands to receive more than $400 million from a prominent Chinese company that is investing in the Kushners’ marquee Manhattan office tower at 666 Fifth Ave.

The planned $4-billion transaction includes terms that some real estate experts consider unusually favorable for the Kushners. It provides them with both a sizable cash payout from Anbang Insurance Group for a property that has struggled financially and an equity stake in a new partnership. 

The details of the agreement, which is being circulated to attract additional investors, were shared with Bloomberg. It would make business partners of Kushner Cos. and Anbang, whose murky links to the Chinese power structure have raised national security concerns over its U.S. investments. In the process, an existing mortgage owed by the Kushners will be slashed to about a fifth of its current amount. read more »

U.S. regulators reject Bitcoin ETF, digital currency plunges

The U.S. Securities and Exchange Commission on Friday denied a request to list what would have been the first U.S. exchange-traded fund built to track bitcoin, the digital currency.

Investors Cameron and Tyler Winklevoss have been trying for more than three years to convince the SEC to let it bring the Bitcoin ETF to market. CBOE Holdings Inc's Bats exchange had applied to list the ETF.

The digital currency's price plunged, falling as much as 18 percent in trading immediately after the decision before rebounding slightly. It last traded down 7.8 percent to $1,098.

Bitcoin had scaled to a record of nearly $1,300 this month, higher than the price of an ounce of gold, as investors speculated that an ETF holding the digital currency could woo more people into buying the asset.

Bitcoin is a virtual currency that can be used to move money around the world quickly and with relative anonymity, without the need for a central authority, such as a bank or government.

Yet bitcoin presents a new set of risks to investors given its limited adoption, a number of massive cybersecurity breaches affecting bitcoin owners and the lack of consistent treatment of the assets by governments. read more »

 

Mystery at Gambler’s Trial: Will Phil Mickelson Take the Stand?

Las Vegas legend Billy Walters is no ordinary gambler. And it’s safe to say his insider-trading trial will be no ordinary trial.

Walters, often considered the most successful sports gambler in the country, is set to appear in Manhattan federal court Monday, having pleaded innocent to charges of conspiracy and securities fraud. But Walters, a secretive figure who parlayed his winnings into a business empire of golf courses and car dealerships, isn’t the only attraction in what is already one of the strangest insider-trading cases in memory. read more »

 

CA Inc. to Pay $45 Million for Alleged False Claims on Government-Wide Information Technology Contract

CA Inc. (CA) has agreed to pay $45 million to resolve allegations under the False Claims Act that it made false statements and claims in the negotiation and administration of a General Services Administration (GSA) contract, the Department of Justice announced today.  CA is an information technology management software and services company headquartered in New York, New York. 

“Today’s settlement demonstrates our continuing vigilance to ensure that contractors deal forthrightly with federal agencies when seeking taxpayer funds,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division.  “We will take action against contractors who withhold information and cause the government to pay more than it should for commercially available items.” read more »

Executives Charged With Manipulating Company's Accounting Systems to Steal Money

The Securities and Exchange Commission today charged two former executives at a credit card processing company with masterminding a fraudulent scheme to steal millions of dollars through phony expense reimbursements, inflated invoices, and other improper accounting tactics.

The SEC’s complaint alleges that iPayment’s then-senior vice president of sales and marketing Nasir N. Shakouri and then-executive vice president and chief operating officer Robert S. Torino routinely reimbursed themselves for payments that were never actually made to third-party vendors using their personal credit cards.  They also allegedly conspired with vendors to inflate invoices and receive kickbacks from the overpayments, and claimed improper commissions and bonuses related to other corporate funds they improperly diverted in various ways. read more »