The International Enforcement Law Reporter

The International Enforcement Law Reporter is a monthly print and online journal covering news and trends in international enforcement law.

Since September 1985, the International Enforcement Law Reporter has analyzed the premier developments in both the substantive and procedural aspects of international enforcement law. Read by practitioners, academics, and politicians, the IELR is a valuable guide to the difficult and dynamic field of international law.

Japanese Company to Pay $54.6 Million After FCPA Probe

In a settlement with the U.S. Department of Justice, Marubeni Corp., a Japanses trading company, will pay the U.S. government $54.6 million dollars for bribing Nigerian officials to receive natural gas contracts on Bonny Island, Nigeria.  Between 1995 and 2004, Marubeni was awarded $6 billion dollars in contracts, which it obtained through bribery.  The Justice Department recently filed a deferred-prosecution agreement charging Marubeni with violating the Foreign Corrupt Practices Act, which prohibits bribery of foreign officials.  

OECD Reprimands Japan, Italy, and Switzerland for Poor Enforcement of Anti-Bribery Laws

The Organization for Economic Cooperation and Development (OECD) has issued reports on the corruption enforcement efforts in Japan, Italy, and Switzerland.  The OECD critizied Japan for poor implementation of its anti-bribery laws, and for only prosecuting two cases since their inception.  Italy was criticized for only sanctioning 3 companies and 9 individuals, and Switzerland was rebuked for only successfully prosecuting one individual, despite the strong possibility of corruption in its financial sector. The OECD urged reforms and that the signatory countries take more action to combat corruption and bribery.

Civil Society Groups Express Concern with Proposed FCPA Changes

Over thirty civil society groups sent a letter to all members of the U.S. Senate and House of Representatives recently to protest any attempt to change the Foreign Corrupt Practices Act (FCPA).  FCPA is currently used to prevent U.S. individuals and companies from engaging in corruption or bribery abroad.  The civil society groups wish for the interpretation of FCPA to remain broad, while proposed amendments would limit its future impact.

Turkey Issues Arrest Warrant for Duchess of York

Turkish prosecutors are threatening Sarah Ferguson, Duchess of York, with 22 years in prison for illegally obtaining footage of orphans while she was visiting Turkey in 2008.  ABC News interviewed IELR editor Bruce Zagaris on the issue.  Mr. Zagaris stated that Ms. Ferguson faces extradition to Turkey if she travels abroad from the United Kingdom, “[e]specially in those countries that have an extradition treaty, and that’s most of the world.” Turkey, as a member of NATO, has extradition treaties with many countries in Europe and around the world, therefore making it difficult for Ms. Ferguson to travel.

IRS to Reopen Offshore Voluntary Disclosure Program

On January 9th, the Internal Revenue Service issued a press release on the reopening of the Offshore Voluntary Disclosure Program.  Unlike the previous two programs, the new initiative will be open indefinitely.  The penalty structure remains the same except for those in the highest penalty category, who will see a penalty increase of 25 percent to 27.5 percent of the highest aggregate balance in their undeclared foreign account of the last eight years.  These new rules are subject to change at any time from the IRS.    

Artwork Stolen from Museum in Greece

Thieves stole works from Picasso and Mondrian from the National Art Gallery in Athens, Greece, this week.  The heist involved careful planning, as the thieves had tested the alarm system during previous visits to the museum.  Officials could not immediately confirm the price of the paintins, but they were significant works by the two famous artists.  The museum has a variety of international organizations to turn to for help recovering the painting, including Interpol and Europol, which have databases of stolen works.

Israel Extradites 4 to the US on Telemarketing Charges

On January 4, 2012, Preet Bhara, the U.S. Attorney for the S.D.N.Y., announced that Israel has extradited four defendants to the U.S. on charges relating to their alleged participation in multiple lottery telemarketing fraud schemes.  See press release below.   The schemes targeted elderly victims in the U.S. and the defendants gained millions of dollars in profits.All of the defendants are residents of Israel.  They arrived in the Southern District of New York on January 3, 2012, and were presented in Magistrate District of New York on January 3.      

US Government Indicts 3 Swiss Bankers

On January 3, 2011, the U.S. Department of Justice and US Attorney for the Southern District of New York announced the indictment of three Swiss bankers, who worked with Wegelin bank in Switzerland. See below for the press release. According to the indictment and DOJ press release,  the three defendants conspired with U.S. taxpayers and others to hide more than $1.2 billion in assets from the IRS in undeclared accounts of U.S. taxpayers at Bank A, which media sources report as Wegelin.

U.S. Extradites Alleged Mexican Murderer

On December 29, 2011, the United States government extradited Joshua Moses Morales, a Mexican national accused of killing the two-year old daughter of his girlfriend in Tijuana, Mexico.  Morales, a U.S. citizen, fled the country after the death, but was arrested by U.S. authorities a year later, and later extradited.  While the U.S. does not always agree to extradite its citizens, in this instance, a desire for closer cooperation with Mexico may have helped influence the decision.  U.S. and Mexican agencies are working closely together in combatting drug trafficking and violence, but the continued pressure has strained relations to some extent.

Magyar Telekom and Deutsche Telekom Settle FCPA Cases with $95 Million of Penalties

On December 29, 2011, the U.S. Justice Department announced that Magyar Telekom Plc., a Hungarian telecommunications company, and Deutsche Telekom AG, a German telecommunications company and majority owner of Magyar Telekom, agreed to pay a combined $63.9 million criminal penalty to settle a Foreign Corrupt Practices Act (FCPA) investigation into activities by Magyar Telekom and its subsidiaries in Macedonia and Montenegro.  

Magyar Telekom entered into a two-year deferred prosecution agreement in the U.S. District Court for the Eastern District of Virginia, where a three-count information was filed, charging Magyar Telekom with one count of violating the the anti-bribery provision of the FCPA and two counts of violating the books and records provisions of the FCPA.  At the time of the alleged misconduct, Magyar Telekom's American Depository Receipts (ADRs) traded on the New York Stock Exchange (NYSE).  Magyar Teleklom agreed to pay a $59.6 million penalty for its illegal activity, implement an enhanced compliance program and submit annual reports concering its efforts in implementing the enhanced compliance measures and remediating past problems.

Deutsche Telekom, Magyar's parent company, entered into a two-year non-prosecution agreement for its failure to keep books and records that accurately detailed the activities of Magyar Telekom.  Deutsche Telekom agreed to pay a $4.36 million pnealty in connection with the inaccurate books and records and to strengthen its compliance program.  At the time of the conduct, Deutsche Telekom's ADRs traded on the NYSE.

SEC's complaints can be seen here and here.

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