On June 22, 2020, the U.S. Supreme Court decided in Liu v. SEC that in an SEC civil proceeding a disgorgement award that does not exceed a wrongdoer’s profit and is awarded for victims is equitable relief permissible under the applicable statute. The opinion answers an important question left open by the Court in Kokesh v. SEC that disgorgement operates as a “penalty,” rendering claims for disgorgement subject to the five-year statute of limitations. See Supreme Court Reigns in SEC’s Disgorgement Power. Liu closes the door on speculation that the Court was poised to hold that the SEC did not have authority to seek disgorgement. Continue Reading SEC Can Recover Disgorgement, With Limits
Dave Eggers and Perkins Coie’s Firmwide White Collar & Investigations Chair (and former Chicago federal prosecutor) Markus Funk have a candid and probing conversation about today’s calls for fundamental criminal justice reform. Dave and Markus cover a wide range of topics, including why we need to fundamentally rethink the state’s treatment of suspects, defendants, and inmates; whether non-violent offenders like actress Lori Loughlin and Ponzi schemer Bernie Madoff ought to receive prison sentences; what it means to “defund” the police; the tragic George Floyd, Rayshard Brooks, Ariel Roman, and Ahmaud Arbery cases; how to improve law enforcement recruitment and training; whether it is time to reconsider arresting DUI, shoplifting, and other suspects in the absence of a threat to the public; the epidemic of criminalization and mass incarceration; the importance of empathy in law enforcement; qualified immunity; procedural justice and the need to ensure systemic legitimacy and creditworthiness; and the pros and cons of including imprisonment as part of an incremental punishment regime.
Perkins Coie’s award-winning White Collar & Investigations practice has teamed up with the ABA’s Global Anti-Corruption Committee to launch a podcast series as an extension of our White Collar Briefly blog.
Our first five episodes, linked below, feature fascinating, candid conversations with a variety of special guests, including:
- American “book of the year” author, editor, screenplay writer and publisher Dave Eggers
- Joel Esquenazi (defendant in the high-profile US v. Esquenazi FCPA case)
- Molson Coors’ Global Ethics & Compliance Chief Caroline McMichen
- Chicago-based U.S. District Judge Virginia Kendall
- University of Colorado COO (and former GC) Patrick O’Rourke
- Avanos Medical Deputy GC Ross Mansbach
Note that all episodes are available on Spotify, Google Podcast, and Apple Podcast. Additionally, you can visit our blog and subscribe to receive each new podcast, including the highly-anticipated Dave Eggers podcast, in your inbox. Continue Reading Introducing the White Collar Briefly Podcast
The U.S. Department of Justice has updated its guidance on corporate compliance programs. In its update, the DOJ offers practitioners further insight on how the DOJ evaluates compliance programs by refining key terms and providing more context. The DOJ has made clear that compliance should not be thought of as a static exercise. Instead, any program needs to be evaluated and refreshed when additional data becomes available ensuring that the compliance program is robust and flexible. Armed with this newly refined direction, prosecutors have authority to reference official guidance when evaluating a corporation’s risk functions, and corporations would do well to take note.
Read the full Perkins Update here:
In 2008, Congress passed the Troubled Asset Relief Program (TARP), which awarded approximately $700 billion in stimulus funds to companies reeling from one of the greatest financial crises to strike the U.S. The TARP included oversight provisions, particularly the creation of a Special Inspector General at Treasury and a Congressional Oversight Panel. Numerous investigations and prosecutions relating to stimulus fraud resulted, some of which continue to this day. The COVID-19 pandemic has the potential to present an even greater economic crisis for the U.S. When developing the recently passed Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which involves roughly $2 trillion in stimulus aid to businesses suffering from the effects of the COVID-19 pandemic, legislators looked to TARP for inspiration, including the incorporation of provisions for investigations and enforcement lifted almost verbatim from the TARP legislation.
The CFTC Division of Enforcement (Division) of the U.S. Commodity Futures Trading Commission (CFTC) issued new guidance (Guidance) on May 20, 2020, that reflects the considerations of the Division when recommending civil monetary penalties (CMPs) to the CFTC in enforcement actions. The Guidance—which marks the first CMP guidance published by the Division since the CFTC published penalty guidelines in 1994—will be incorporated into the CFTC’s enforcement manual and will be binding on all Division staff.
Read the full Update here.
A new $2 million SBA safe harbor for PPP loans appears to create a wide umbrella that substantially reduces the risk that adverse consequences will rain down and soak companies with loans in this category. Perkins Coie attorneys examine the May 13 guidance and say companies will continue to benefit from conducting a PPP “necessity” analysis.
Reproduced with permission. Published May 15, 2020. Copyright 2020 The Bureau of National Affairs, Inc. 800-372- 1033. For further use, please visit http://www.bna.com/copyright-permission-request/
As this blog has previously noted, the Coronavirus pandemic, like other crises before it, is likely to increase prosecutions for fraud, particularly under the Payment Protection Program (“PPP”) created by the federal government’s Coronavirus stimulus packages. Two new prosecutions announced by the Department of Justice mark some of the first prosecutions under the PPP, and signal where and how the government will be looking for wrongdoing. Continue Reading Prosecutions Related to Coronavirus Stimulus Begin
Companies seeking PPP loans must concurrently navigate the potential minefield of public scrutiny and government enforcement, requiring a heightened level of planning and procedures.
An adequate compliance program is a must to avoid ramped-up enforcement efforts and to minimize legal and reputational risks.
Reproduced with permission. Published May 1, 2020. Copyright 2020 The Bureau of National Affairs, Inc. 800-372- 1033. For further use, please visit http://www.bna.com/copyright-permission-request/
On April 14, 2020, the U.S. Department of Justice made a long-awaited move towards enhanced transparency into the corporate compliance monitorship selection process in launching a new webpage that lists the names of all independent compliance monitors for the Fraud Section’s thirteen active monitorships. Seven of the active monitorships are associated with the FCPA Unit, five with Market Integrity and Major Frauds, and one with Health Care Fraud.
The move to publish names comes after years of criticism–and in some cases, litigation–surrounding the confidentiality of DOJ’s selection process. As reported previously on this blog, in March 2018, a D.C. federal judge ordered the Department of Justice to turn over the names of prospective monitors nominated to oversee the corporate compliance programs of fifteen companies found to be in violation of the FCPA. While recognizing that these individuals have “more than a de minimis privacy interest in their anonymity,” the court found that any such privacy interest was outweighed by the public’s interest in learning their identities. Prior to that, in the Fall of 2016, a federal district court in the Southern District of New York appointed its own monitor, rejecting the three candidates proposed by the government and the defendant company. The court concluded that two of the three candidates were under-qualified and had not been fully vetted (one was a full-time law student).