Navigating the FCPA: Third-Party Risk, Compliance Strategies, and Potential Enforcement Changes

Zachary Chalett | Perkins Coie LLP

Zach Chalett is a counsel in the White Collar & Investigations Group at Perkins Coie LLP. Zach conducts complex internal investigations for a diverse range of clients, from Fortune 50 companies to professional sports franchises and non-profits. He also represents companies in anticorruption, fraud, and related government investigations and enforcement proceedings, and advises companies on developing effective compliance programs.

Nikhi Raj | Perkins Coie LLP

Nikhila Raj is currently a counsel with Perkins Coie LLP. Before joining Perkins, Nikhi was a DOJ trial lawyer with the FCPA Unit of the Fraud Section and the Bank Integrity Unit of the Money Laundering and Asset Recovery Section. During her DOJ tenure, she was one of the lead prosecutors in the landmark FCPA case against an investment bank headquartered in New York City, resulting in a $2.9 billion penalty and the bank’s first-ever guilty plea. Post-DOJ, Nikhi served as the deputy general counsel for a billion-dollar fintech company, overseeing all its litigation.

Travis Exstrom | Microsoft

Travis Exstrom is an Assistant General Counsel in Microsoft’s Proactive Risk Engagement organization. He leads the legal team responsible for proactively mitigating Microsoft’s corruption risk globally, taking a cross-disciplinary approach to identify and address the root cause of risk signals, design resilient controls and monitoring systems, manage third party risk, and advise on sales motions and complex transactions. Prior to joining Microsoft’s legal department, Travis practiced at Perkins Coie in Seattle, specializing in white collar criminal defense, investigations, and corporate compliance. Travis earned his B.A. in Philosophy from Whitman College and his J.D. from the University of Washington School of Law, where he was a member of the Law Review and Moot Court Honor Board.

I. Understanding the FCPA | 12:00pm – 1:00pm

• Anti-Bribery Provisions
  • Who is covered?
  • Liability standard
  • What is a bribe?
  • Who is a foreign official?
  • Use of third parties
    • Direct participation in third-party bribe
      • Recent resolution
    • Authorization of third-party bribe
      • Recent resolution
    • Knowledge of third-party party bribe
      • Recent resolution
    • Other (e.g., aiding & abetting, conspiracy)
      • Recent resolution
    • Facilitation payments
    • Theories of Liability
• Accounting Provisions
  • Books and records provision
    • Who is covered?
    • Key definitions
    • Liability standard
  • Internal accounting controls provision
    • Who is covered?
    • What is covered?
  • Theories of Liability
    • Issuer directly affected by third party
      • Recent resolution
    • Subsidiary affected by third party
      • Recent resolution
      • Non-issuer subsidiary
    • Other (e.g., JVs, consultants)
      • Recent resolution
• Penalties for violations

Break | 1:00pm – 1:10pm

II. Strategies for Identifying and Mitigating FCPA Risk | 1:10pm – 2:10pm

• Effective corporate compliance program
  • DOJ’s Evaluation of Corporate Compliance Program Guidance
  • Leveraging technology, including AI, and data analytics
• Third parties
  • Compliance and audit provisions in contracts
  • Vetting and monitoring
    • Identifying high-risk transactions and red flags
    • Balancing red flags with business priorities
  • Minimizing excess liquidity
    • Proof of execution requirements
    • Discounts to public sector customers
• Case studies/hypotheticals regarding identifying and mitigating risk
• Responding to possible FCPA violations
  • Conducting effective internal investigations
  • DOJ’s and SEC’s reporting channels
    • Managing disclosure risk
      • Benefits of self-reporting
      • Downsides of self-reporting
      • Recidivism
  • Cross-border enforcement actions
• Discussion with Travis Exstrom regarding how Microsoft identifies and addresses FCPA risks
• What is next?
  • Supreme Court decisions (bribery, Chevron deference reversal)
  • Continued emphasis on compliance programs/controls as foundational to multiple agencies/potential charges
  • Decreased enforcement/international cooperation/focus or less focus on certain industries