Transcripts For CSPAN3 Key Capitol Hill Hearings 20161128

When you say we are talking about a remedy not in terms of finding a violation. Dont say you are implementing congresss intent when you look at what a congress 60 years later would do. When you are rendering a gender discriminatory statute by leveling up or down you are not using congresss intent. But you will ask what would they have wanted if they knew they couldnt make this discrimination. I thought if you have to go back to 52, they are going to either have to take the benefit away from the woman or give it to the man. They hate that. They get into trouble when they take benefits away. That moves them in one direction and also moves them in the same direction if there are a handful of men who might benefit. If there were millions of men who might benefit they might get worried about what they are doing particularly since they are discriminating more against the married couple. I was interested in those questions, but i take it you have said what you can say on that. All you can say is they would have to meet a lot of requirements. We are talking about a fairly limited class. Children born outside the United States born to fathers who cannot satisfy the tenyear requirement but they can satisfy the oneyear. Assuming Justice Ginsburgs point that the father has to have legit ma tiezed the child without marriage because if they marry the mother they would end up having to fulfill the fiveyear. We are not challenging that. They may be individually challenging. In this case they could be. This is a different requirement than what was at issue in the wynn case. The court addressed a paternal acknowledgment requirement and said thats a minimal burden for the father to satisfy. He is not similarly situated with respect to biological proof of his relationship with the child, but the requirement he then come forward and take affirmative steps to demonstrate by acknowledging the child, that satisfies intermediate scrutiny. We are talking about the requirement. As the amicus brief points out if legitimate meant marriage the father may not be able to satisfy the requirement at all. For example if the mother isnt available. If she doesnt want to marry the father or if shes dead. Or if hes already married. If he is already married. Where is the requirement . 8 usc 1409 c. It doesnt say a word. Its in 1409 a. That doesnt apply. It says notwithstanding subsection a. Right. Notwithstanding subsection a somebody who is born outside the u. S. Out of wedlock shall be held to have acquired at birth the nationality status of his mother if the mother is a u. S. Citizen and had been physically in the United States for one year. I dont see anything that says they have to be legitimized for the mother to get that. In 1409a it applies only after theres been in 1409a and what the first words of c are notwithstanding the provision of subsection a. Right. I could figure it out later. Let me try to help you. The remedy imposed by the court of appeals is as 1401 a 7, the physical presence requirement, the court of appeals, that applies through 1409a. Thats the provision that applies to fathers. The remedy would be to apply the one continuous year rule in 1401a7 and this is complicated. As it applies through 1409a. That would put mothers and fathers on equal footing with respect to the physical presence requirements and the legitimation requirement still applies to fathers. But if i could address the governments u. S. Connection interest in my time remaining the statute here absolutely bars a u. S. Citizen father under the age of 19 from transmitting citizenship to his foreignborn child even if the father spent his entire life in the United States up until the day the child is born and even if the father legit mates the child and seeks to raise the child in the United States. By contrast the statute automatically confers citizenship on a child whose u. S. Citizen mother spent only a year of her life at any point in her life, even during infancy. Even if the mother marries the alien father and the child is raised by the mother and the alien father. It is impossible to view a statute that permits these results as related to a u. S. Connection interest. I would submit, your honor, the statelessness interest doesnt justify discrimination either. There is no dispute that the statute creates statelessness for children born abroad to fathers who legitimate their children but cant satisfy the ten and fiveyear physical presence requirement. The statute confers citizenship on a child born abroad to an unmarried United States citizen mother even if the child faces no risk of statelessness at all. Because shes born the child is born in a country that assigns citizenship by virtue of being born there. We arent leaving children uncovered whose mothers have not had a continuous one year residency in the United States though the mother might be an american citizen. Thats right. Her child might have no face no risk of statelessness at all yet the statue still confers citizenship. I said they do. The mother can only pass on citizenship if shes been in the United States continuously for a year prior to the birth of the child. Correct . Correct. What happens to a citizen mother who cant meet that oneyear requirement . What happens to her child . That child could be stateless. There is a risk of statelessness, no matter what . There is a risk of statelessness but that risk is created by these physical presence requirements that congress chose to impose. Whether it is the mother or the father. The risk is greater with respect to the fathers. It is lesser with respect to the mothers. But it is the physical presence requirements that create the risk of statelessness and this scheme cannot be justified as seeking to reduce a risk of statelessness. If the court has no further questions, thank you. Thank you, counsel. Three minutes, mr. Needler. Thank you mr. Chief justice. First on the merits. The provision here furthers two substantial governmental interests. At the time the child is born and there is only the mother as a recognized parent it is uncertain whether the child will ever be legitimated. Congress has an interest in conferring citizenship on that child at birth if there is a connection to the United States. Congress has a substantial interest in not die vesting the child of citizenship if the child is later legitimated by an alien father. There are two substantial interests that are furtherered and it is tailored to take care of the two interests. If youre concerned about the stateless children in the world then you have a problem with the father who cant transmit his citizenship in a country where women citizenship goes by who was the father. If the father later legitimates hes put in the same position as if they were married at the time the child was born. We know from 1401 that thats today there are lots of fathers who do look after their children. I dont say they do it perfectly, but they try. Right now. Now suppose just the words you said take the same words, just put in father instead of mother. Today, why is it any different . It isnt different. I just want to repeat again when the father legitimates there are two parents. Im not talking about legitimacy. Im talking about a surprising number of people unfortunately never get married. A lot of them do live abroad and they do have children. Certainly your words applied where it was the mother. My question is couldnt you put the same words and apply it where it is the father . I think it is of critical importance in citizenship laws to have a legal occurrence in order to pass citizenship and thats legitimation. Your suggestion that the father could pass on citizenship without legitimation doesnt c say that . Yes. But this is a question of remedy. But and also in laird versus robertson if the father filed a notice or filed a document and got notice of the proceeding he didnt get the veto power the mother had before legitimation. He got to be a parent, too. Thats what happens here. When the father legitimates hes not put in the same position as the mother. There are two parents. Thats a two parent family. With respect to remedy, let me point out on page 38 where the statelessness is addressed its clear the interests i identified that congress wanted to ensure the child would have citizenship at birth and not be die vested. Thank you, counsel. We have a special web page at cspan. Org to help you follow the Supreme Court. Go to cspan. Org and select Supreme Court near the righthand top of the page. Once on our Supreme Court page you will see four of the most recent oral arguments heard by the court this term. Click on the view all link to see all the oral arguments covered by cspan. In addition, find recent appearances by many of the Supreme Court justices or watch justices in their own words including one on one interviews in the past few months with justices kagan, thomas and ginsburg. There is a calendar for the term, a list of all current justices with links to quickly see their appearances on cspan, as well as many other Supreme Court videos available on demand. Follow the Supreme Court at cspan. Org. A look now at how the Justice Department investigates and enforces International Corruption and fraud cases under the foreign corrupt practices act. This law prohibits payment of bribes to foreign officials to assist in obtaining or retaining business. Held by George Washington University Law school, this is about 90 minutes. Good afternoon. Im the Senior Society dean for Academic Affairs and on behalf of the dean and the president i welcome you to the George Washington University Law school. I will hand over the podium momentarily to my colleague who will normally introduce our two distinguished panelists, but first let me say how thrilled we are to host this discussion on the foreign corrupt practices act, one of the most significant issues confronting criminal law practitioners today. Among our full time and part time faculty are many who like myself have served as federal prosecutors or defended individuals and entities charged with criminal conduct, including under the fcpa. We have a rich curriculum in the areas of criminal law and procedure here and we produce many graduates who go on to have distinguished careers in government and private practice. One such star graduate is the assistant attorney general for the Criminal Division Leslie Caldwell. Were so excited to welcome her pack this afternoon. Although our other distinguished guests is not a gw law graduate, she too has a strong connection to the university. I learned this week that her father once coached football at George Washington university. Yes, we once had a Football Team and he was a phenomenal coach and after coaching at gw went on to coach in the nfl. So in a way youre part of the gw family so welcome back karen. With that i will hand over the program to my wonderful colleagues our society dean to formally introduce our guests and to moderate the discussion. Thank you again and welcome. Thank you so much for that kind introduction. As you just learned, Roger Fairfax was a former department of justice lawyer. We are fortunate to have him along with other prosecutors and defense lawyers on our faculty. The experience they have had in practice brings immense benefits to the students here at the George Washington University Law school. I would like to welcome to you this conversation about the foreign corrupt practices act with two very distinguished lawyers. The assistant attorney general leslie kaldwell and karen pop who is the chair of the white collar group. The event is possible due to the hard work of a number of people and i would like to thank them at the outset. My colleagues here at the George Washington University Law school, dean Roger Fairfax, and to ms. Kraldwells colleagues. Thank you so much for all of your help in making this possible. In 1977 the United States enacted the foreign corrupt practices act designed to eliminate or minimize corruption of foreign officials by certain persons and entities. The statute has been amended on certain occasions as well to expand its reach. The antibribery section of the foreign corrupt practices act is enforced by the United States department of justice. It raises a host of issues such as the extra territorial reach of u. S. Law, the relationship between practices of Foreign Countries and standards in the United States, the appropriate penalty to be given for violations of the act and the consideration that should be given to companies and individuals that have adopted policies and practices to prevent violations of the foreign corrupt practices act. Today were going to have a conversation about these and many other topics. Were honored to have with us our graduate Leslie Caldwell who on may 15th, 2014 was confirmed as the assistant attorney for the United States department of criminal justice. She works with more than 600 lawyers who prosecute federal criminal cases around the country. Shes responsible to help develop criminal law and formulate criminal enforcement policies. She also has worked closely with the 93 u. S. Attorneys that have involved in investigations and prosecutions of criminal matters in the districts around the United States. Her entire career has largely been dedicated to handling federal criminal cases as a prosecutor and as defense counsel. Shes known particularly for her work on the task force, which she was director of from the year 2002 to 2004. She worked at the u. S. Attorneys office for the Northern District of california and had served as the chief of the Criminal Division and the chief of the securities fraud section. She worked for 11 years in the United States Attorneys Office for the Eastern District of new york including serving as senior trial counsel for the business and securities fraud section and chief of the antifraud section. For her distinguished work on the task force she received an award for Exception Service and the john marshal award for trial litigation and the attorney generals award for fraud prevention. She also had before joining the Criminal Division a position as a partner at morgan and lewis and she was co chair of the firms Corporate Investigations and white collar practice group. Its great to welcome you back to your ala matter. Youre here in school again and were delighted that youre here and shes a graduate of Pennsylvania State university. She will provide opening remarks and then karen pop from the law firm of Sidley Austin will give a response as well. Let me just also introduce karen at this time too. Shes on the firms executive committee and as i mentioned she leads the firms white collar government litigation investigations group. That group is recognized as one of the top highprofile white collar groups in the United States with substantial experience in legal, political and Public Relations aspects of criminal defense, internal investigations, congressional investigations and the list goes on. Karens practiced is informed by a wealth of government and private sector experience including serving as a federal prosecutor in new york, a lawyer in the office of Legal Counsel at the u. S. Department of justice and Society White House Counsel to president clinton. Shes a graduate of the university of North Carolina where she earned her bachelor and jd degrees. We look forward to your opening remarks and after that ms. Pop will provide some comments. I have some questions and after weve had a discussion with the three of us, well open the floor to questions and comments. So please lets welcome leslie back to her alma mater. Thank you, dean. I can say that when i was here, none of this was here. It was a very different Physical Plant back then, but its great to be back at gw. I had a lot of good memories here and for me it was a great Legal Education and ive always valued it so hopefully those of you who are students are having a great experience. As the dean said, 2 1 2 years ago i was privileged to be named by the president and confirmed by the senate to become the assistant attorney general for the Criminal Division. Many people dont know what the Criminal Division does. Most people know about the u. S. Attorneys offices, which there are 93 of them and they do mostly focus on crime in their geographic areas. We went beyond our area too. In the Criminal Division were not really limited by geography, so we focus on subject matter. We have 17 sections. They do all sorts of things. Im not going to list them all, but ranging from very sophisticated really scarey child exploitations to Asset Forfeiture and Money Laundering to the fraud section which does Major International fraud cases. Theyre the ones looking at the vw investigation, the Panama Papers. Because we dont have geographic limits other than obviously the limits of federal criminal jurisdiction, we have an international and National Scope from which we look at everything and a different advantage point i think than u. S. Attorneys and i think that has enabled us to focus on emerging areas in White Collar Crime and shape our policy and the way we approach things. Id like to talk today about a couple of things. There were many others, but a couple of things that i thought were particularly important when i started as assistant attorney general and share with you why i think theyre important and what we did to try to address them. I wanted us to sharpen our focus on International Corruption and international cases. I felt that we were too random on what we were focusing on and we spent too much time focusing on cases before we decided whether something was there or not. I wanted us to work on bigger cases and more impact cases and important cases. The second major thing that i really wanted to do and this was borne of my experience as defense lawyer was i wanted there to be more transparency in our charging decisions. When we decided to charge a corporation and im talking now in the corporate context, when we decided to charge a company, what factors do we consider. There are factors that are in guidelines, but if you were outside counsel as i was, you would see what appeared to be inconsistent and sometimes even arbitrary outcomes in what seemed to be fairly similar fact situations. One other goal i had was to try to increase transparency. So i want to talk briefly today about both of those things. International corruption, thats been a priority for the department. It continues to be a priority. Its important because you cant measure the damage caused by International Corruption just by looking at numbers, although the numbers are staggering. More than 1 trillion according to World Bank Estimates is paid out in bribes every year by corporations trying to get businesses in various parts of the world. That is 3 of the entire world economy, so thats a very significant number. More importantly we see the corrosive effects of corruption, the anticompetitive effects of corruption on u. S. Companies that are trying to play by the rules and cant compete with Companies Paying bribes. Corruption is very destabilizing. Its destabilizing for governments and citizens. It undermines confidence in government. It undermines the sense of fair play. Its true in emerging economies where sometimes people are getting rich and theres no infrastructure and people are living on less than a dollar a day or less than 10 a day and the fruits of corruption, weve seen you see it in the news, but we see it in our cases can really help prop up autocratic regimes. It presents broader Public Safety concerns. Weve seen in extreme examples where corrupt regimes have created safe havens for criminals and terrorists who can fan out across the world and commit their crimes and engage in terrorist acts. These are some of the reasons why its been a priority and continues to be a priority. Im sure its going to be continued by whoever succeeds me, but i hope that they maintain the focus that weve had, which is to try to focus on the bigger cases, the cases that have a bigger impact. Ill give you two examples from the last couple of years. One is there was a french power and Transportation Company and in december 2014 they paid 772 million in criminal penalties in connection with a scheme to bribe officials in ten different countries. That was the highest criminal fine ever paid. One of the reasons they paid that fine is because they refused to cooperate with Law Enforcement in any country. They were under investigation in several countries. They refused to cooperate. The bribery was significant and it was directed at fairly high levs within the company. Another settlement we had this year was a with a Dutch Telecom company which was paying bribes along with several other companies, they paid more than 114 million to get access to the telecom market. They resolved their investigation with an 800 million resolution that included resolution with us, the department of justice, the s. E. C. And with authorities in the netherlands. Thats one thing that were seeing increasingly is were working increasingly with other countries, sharing investigation, leads, evidence, witnesses, giving each other tips. Some of these cases have come from tips to our Law Enforcement from overseas Law Enforcement and we likewise give information to folks overseas. A good example of that is just last week we announced the resolution of an investigation into bribery by the brazilian aircraft manufacturer, which those of you who take the shuttle between new york and boston and d. C. , that are the jets that youre on. That was a case we worked jointly with brazil and saudi arabia. Brazil and saudi arabia prosecuted more than one dozen individuals for their involvement in that scandal. We have something that im excited about in the Criminal Division thats relatively new which is called the Asset Recovery initiative. The fcpa is housed in the fraud section which is our largest section. We have about 140 lawyers in the fraud section. Thats a big change. When i was in the Criminal Division before back in 04, there were about 50. So thats really a dramatic change in the face of the Criminal Division and the fraud section. The goal of the initiative is to trace and forfeit proceeds of foreign corruption and when its possible to figure out a way to get that money, the money we can get our hands on, back to help the country, the people of the country where that money was stolen. For example we did a year or so ago a resolution that involved a former soviet republic and we were able to get our hands on a large amount of money and work with the ngo to fund and oversee some Youth Activity programs in that country. That may sound like a small thing, but rather than the u. S. Keeping the money that we seized that was stolen from that country, we got the money back to that country for useful programs and we have an audit mechanism to make sure that the money is going for the good program that we think were funding as opposed to going back to the pockets of the people that stole it in the first place. The initiative is new and the work is painstaking because in order to forfeit money and seize it we have to be able to identify and prove the original crime, the original corruption, the original theft, the original bribery, whatsoever the underlying crime was and then we have to trace that money from the crime to an account we can get our hands on. Thats hard to do because those folks are very sophisticated. Its not in their name in an account at citibank. They put that money in offshore account a to offshore account b to c. Its difficult to trace and prove that the money is the proceeds of the underlying crime. The lawyers, the Panama Papers case that youve probably read about, lawyers and sophisticated accountants, theres a network of people whose job it is to help people hide and move their money. Its difficult to penetrate that. Witnesses are difficult to find because often times the cleptocrats are still in power. So youre not going to get somebody from that country who knows what happened to come to you if they are going back to their country to give to you and give you evidence. Were seized more than 3 billion in the last three years. Most of those assets are in the United States. One of the reasons for the initiative is we dont want the United States to be a safe haven for the stolen money. We dont want the dictator of name that country to be able to own the penthouse in new york or own a huge mansion in washington with stolen money. We dont want to be a haven. Some of the assets weve seized have been mansions all over in malibu and apartments in new york, we seized a hotel in beverly hills. Weve seized impressionist art. We had a case this past summer that involved the Malaysian Sovereign Wealth Fund where more than 3 billion was siphoned off and used for things, including among other things buying mansions and hotels and funding a movie. The wolf of wall street was funded. We own the rights to the wolf of wall street. So tonight go home and down lode it and youll be adding to your governments coffers. If you dont want to add to the governments coffers, dont lone download it. I want to talk about transparency. When i was at my firm i was frustrated because when you represent a client and the client has a problem and the client is going to have to deal with the department of justice, the client wants to know whats going to happen. You just really werent in a position to tell the client with any degree of certainty if you go in and self report this, heres what will happen. There was no real clear road map. Its very difficult to give a clear road map as i found in this job because everything is so fact specific, but i wanted to try to do as best we could to make our decisions and our actions more transparent around understandable. So transparency is really important because it really helps not only does it help Companies Understand what might happen, it helps the public see what were doing and why were doing it. I think it also deters future wrong doers because being transparent about what will happen to a company if it does x is a good way to deter the company from doing x because they will see the consequences of what they do. Weve done two things to try to make the corporate charging decisions more transparent. One is in all of our charging documents, except for indictments, which there are not that many indictments of a corporation, theyre usually resolved with a guilty plea or prosecution greatly or nonprosecution agreement. We used to not say in those documents why, why is this Company Getting a deferred prosecution agreement, which say if a Company Fully cooperated or gave us access to documents, gave us evidence, its all very fact specific and if you go on website youll see resolutions and the language that describes what the company did. So in some cases maybe the company self reported, cooperated, remediated and did much better than the company that didnt cooperate until they switched counsel which happens a lot and then they cooperated. But they still dont get the full credit of the same credit as the other company. We tried to do that. The second way in which we tried to increase transparency is recently six months ago started a Pilot Program in our sfca cases only. That provides guidance to the prosecutors doing the cases about corporate resolutions and it provides some benchmarks about if the company does x it will be eligible for certain things. So if the company voluntarily selfreports and cooperates and remediates and tells what profits they made in the contract through bribery, even with when there is a bribe that we can prove, we may decline prosecution of that case. And that is intended to be a carrot for those companies. We think its important that they still have to disgorge the profits. But in any event, the Pilot Program is something that its new. Its only six months old. We have seen that its been having an effect. Weve seen an uptick in self reporting. Its too soon whether that is attributable to the Pilot Program or whether that happens to be whats happening this year as opposed to next year. But i think its working. I think that its giving and id be curious to hear karens thoughts, i think its giving counsel something they can tell their clients when their clients say what is going to happen to me if i go in and deal with the government . Another thing that we did is voluntarily disclosure used to be an element of cooperation. We have nine factors that we consider in deciding whether to charge a corporation. They are called the philip factors. Theyre in our website and our u. S. Attorneys manual. We added one and separated self disclosure from cooperation. Now self disclosure is the own factor. In addition to all the other cooperation, self disclosure is something that we also consider. And that was intended to urge companies to self report and to separately and additionally reward them if they did that. So im skipping over some of these notes in the interest of time. I really want i think that those are really the main things that weve done in the last couple of years that i think have at least been aimed at and improving our corporate prosecutions and our sfca prosecution against individuals. The idea is get the company to self report by giving it some incentives so that when it comes in and self reports it will give us the information that it has because its already commissioned an outside investigation by an outside law firm. It will give us the information it already has that will in turn enable us to prosecute individuals. We recognize that prosecution of individuals is the biggest deterrent. In my view and i think most people would agree that is the biggest deterrent to corporate wrongdoing and criminal wrongdoing. Actually not just criminal and corporate wrongdoing but all wrongdoing. That is one of the main goals of the Pilot Program. So hopefully its too soon to tell whether its working. But we think its heading in the right direction. I hope when i depart my sand in my hourglass is moving faster by the minute. We have to hear every morning from one of our people. We have 77 days left. Its a real honor to be assistant attorney general and proud to represent gw in that space and hope one day one of you is sitting in that same chair. Thanks. [ applause ] thank you for setting out clearly the focus of the department on International Corruption and the specific angles that the department is taking. I thought in particular the Asset Initiative is very, very keen and the benefits it can give beyond the enforcement of law here in the United States. And secondly, to give us guidance on transparency and insight into the Pilot Program which well talk about in a few minutes. Miss popp, would you like to say a few words in response to her observations . I think she did tee up one issue directly for you. So please feel free. Which i know were going to be talking about a lot today and that is the Pilot Program. Let me just say that i a lot of what leslie said, i commend the department of justice for all the efforts being made to be more transparent. I think that is extremely important to corporations and individuals and anyone that comes under investigation by the department is to have more transparency into what is going on, the thought process by prosecutors and its extremely helpful for those out there who are attempting to have effective compliance programs and other decisionmaking that goes on in Corporate America. I also think the Pilot Program is a good idea and that is based on large part from the prior comments from the department is to is to hold that carrot out and to have transparency on the backside as to how those results were achieved. On the other hand, there are some concerns that we still have in the private sector in the defense bar and also amongst corporations and individuals. I know were going to be exploring some of those. I think one of the concerns is the long arm reach of the u. S. Government out in throughout the world. And because this practice and were focused here today on the fcpa because the practice when youre representing corporations really is what i like to refer to is a Conference Room practice. You dont go to court. You dont have a judge arbitrating the arguments that the government may make as opposed to the defense. And jurisdiction is often one of those topics that the government has a different view of its reach than the defense. And so its an area that dependent on what prosecutors across the table, you may have a very aggressive view on what the evidence is as to rather jurisdiction exists. And i also, you know, its difficult and leslie alluded to this, companies and we are a Global Economy today. Many, many, companies in this country are global. Many companies outside of the u. S. Are global and hence doing business here. And it is it can be very unlevel Playing Field throughout the world for corporations that are attempting to do business. And i encourage the our government to continue its efforts that i know has been going on for some time now to encourage other governments to enforce their own laws. So that companies in those countries have to abide by the same rules that u. S. Companies have to abide by. So there is a level Playing Field. And then, you know, my its also music to my ears to hear that department of justice is emphasizing big cases. Having big impact. You couple that with the Pilot Program. This is something that im going to put to leslie right now and she doesnt have to answer it right away. But it is a question that i know being asked and that is, is there a threshold that a company should be considered and rather to disclose . At what point should a company if it has an issue, what point should it be bringing it to the attention of the department of justice under the Pilot Program. Because it is something that is often faced out there by companies that are doing business globally. And i expect that the department of justice doesnt want every little thing brought to them under the Pilot Program. I think its a good thing for us to talk about today. I will leave my other comments on my observations about the Pilot Program, prosecution of individuals, selfdisclosure, cooperation, for the q a. All right, thank you so much, karen. Leslie, i think we have a question on the table already. And i suggest we focus on the Pilot Program first and the challenge that was just raised by karen and i have a couple questions as well on that subject. Go ahead, please. So there is no threshold. We wouldnt tell a company if there is a bribe over 40,000 you should self report. We dont usually prosecute. We recognize that any big company cant control all of its employees all the time. We recognize that if you are a Company Operating in certain geographies, you are going to be paying possibly small but you will be paying some kind of inappropriate payments. We recognize that. We recognize that companies have rogue employees who dont follow company policy. Even when there is a Strong Company policy, it may still be the case that somebody in the company does something that is off the reservation. That happens all the time. I did work in this area when i was in private practice, and i know that its impossible for a big Global Company to make sure all of its employees are following the law at all times. So there isnt any threshold. I think if i were a company and i were thinking about whether i wanted to self report, i think about a couple things. I would think about, was anyone lets say its a u. S. Company. Was anyone in the u. S. Involved in this . If somebody in the u. S. Was involved in this, if somebody high in the company was involved in this, if somebody even high in a foreign jurisdiction was involved in this, the higher you go the more likely it is that somebody else is going to tell us about whatever happened. I dont like to tell people on the self report unless you think you are are going to get caught. But there certainly is an element of that. So if you have a serious problem and we get reports from whistle blowers, competitors that didnt get the bid because they didnt pay the bribe. The chances of us finding out and we have added to our fcpa resources in terms of fbi resources and prosecutor resources. Were working now with prosecutors and Police Agencies all over the world. I mentioned the case with brazil and saudi arabia. In the al stom case, we gave evidence to the indonesian authorities who prosecuted the corrupt indonesian public officials. So we are all talking to each other and were sharing information. So if you got something that is a significant issue, you should seriously think about telling us about it and trying to get credit under the Pilot Program. We dont want to hear about the bribe paid on the dock in argentina to get your package to leapfrog the other packages. We dont want to hear about the gift to the Chinese Government official that he was given a big box of cigars on chinese new year. We dont need to hear about those things. We dont want to hear about those things. We also dont want to hear about things when you dont really have a sense of what exactly happened. We want you to tell us soon enough but we dont expect you to tell us as soon as you get the hotline call or as soon as you start your investigation because in my own practice experience, a lot of the allegations turn out to be unfounded or turn out to be Something Else or turn out to be what somebody thought happened that didnt actually happen. So there is no threshold. I think if youre worried about it and its a serious thing, i think you should tell us about it. Because the risk of us finding out is greater and the consequences to you if you dont and we find out are fairly significant. Can i ask a followup . One of the things that happens in private practice, as you know, is that a client can call you. Theyve got an allegations. They want you to help. I often call it what kind of alligator do you have by the tail . You dont yet know. But youve got this Pilot Program out there thats giving you a carrot to rush in so that you get all the benefits of it. And im happy to address and be asked what i think the benefits are and what theyre not. But the question is for defense counsel is that and advising the company, the Company Needs to take enough steps to figure out what type of issues. And just like you said just now, you dont want to hear everything. So its a real judgement call. How far down the path you go, especially if you dont know if theres going to be a whistleblower will get to you before we decide to come to you and youre going down that path of taking investigative steps. Youre constantly weighing the possibilities that the government could find out before you take those steps. And so like my threshold question, i take it you all also do not have a definitive view as to what point in time a Company Needs to come in. That you do expect us to take some steps and if you could enlighten us and i know this is one of my concerns about the program. The program is only as good as the individuals who implement it. And so i know that this question is really your perspective. But at what point, what down that path of investigative steps are you thinking a Company Better get in . Or do you think we should come in immediately . Im assuming that last question is no. I think it depends, which is a typical lawyer answer which you will all give for the rest of your careers. It does depend on the facts. If somebody comes in and they say that the ceo or an example that came from an actual case we have a department in this Company Whose reason is to keep track of the bribes. And we have paid bribes to the tune of hundreds and hundreds of millions of dollars. You know what kind of alligator that is. You dont need to know more than that. You may want to make sure that somebody is not crazy in making something up. If there is a shred of truth on that, you want to do that. Somebody says you get anonymous hotline complaint that weve been paying bribes in china to get business from the following five state owned enterprises and we paid even with some level of specificity, youre going to want to look at that and see whether thats true, whether the real you even had deals with the state enterprises and whether you paid money and whether the people who are supposedly involved in it actually even worked on the deals. Youre going to want to kick the tires on the allegations. We dont expect you to come running into us. But when you have a good reason to think its true and serious, thats when under the Pilot Program we would expect you, if you want to get the benefits of the Pilot Program, thats when we would expect you to raise a flag with us. What do you say about the challenge that this program is largely designed to assist corporations and individuals may be left out there and not getting the benefit of it and then they end up, perhaps, baring the responsibility when there was enormous benefit to the corporation . I guess the benefit would be given back. But how do you address that concern . So i think part of the purpose of the Pilot Program is to encourage i know karen has in her files in her firm probably 50 fcpa investigations that doj doesnt know about. That shes done full, complete investigations. She knows what money was paid to what Government Entities or individuals. She knows who paid it. She knows who in the company is responsible. Shes not telling us. We want that information because we want to be able to make cases against those individuals. But we dont have that evidence. Part of the idea of the program is to give the company an incentive to come in and tell us something and give them some carrot to do that. Obviously, we dont just coming in on the Pilot Program doesnt mean youre getting a declanation. You may well have to you wont have to plead guilty but youll have to get a deferred prosecution agreement or some other agreement. You may have to get a monitor. The Pilot Program has a lot of Different Things that can happen. The idea is to get that information that we know is out there about culpable individuals so that we can make the cases against the culpable individuals. Companies cant go to jail, obviously. Individuals can. As i said earlier, i think the biggest deterrent to wrongdoing is to prosecute individuals. So that is part of the goal. We have whistleblowers who come forward in these cases and other cases. They may have been in the thick of the wrongdoing. If they come forward and tell us things we often dont prosecute them. Just the same as any other criminal conduct. We sometimes dont insist they be held criminally accountable. So it is not that different than what we normally do. Its designed to get at the information in karens files. If i could do a quick followup question. Does that put pressure on the companies then to in effect make a judgement about culpability even if there could be differences of perspective on an issue and good faith differences . Are you asking me . I was asking karen. From your practice. I was actually going to address somewhat of that. And plus some. Obviously, im not going to comment about any files that i have. Any of the 50 files. I think this is actually where theres a rub. With the sally yates memo the Deputy Attorney general who issued a memo and put in process reemphasizing and put in place a process about going after individuals and then, of course, the Pilot Program where were seeing in the letters, a reference in the letters that the Companies Must cooperate against the individuals. And, you know, the rub is that if a company and certainly by now corporations out there in america know that you have to have an effective compliance program. I would say that at least my experience is that most companies have very strong robust programs. And so if a company is, in fact does comes to their attention that there is an allegation of wrongdoing involved in amongst their employees or an employee, a rogue employee, the company is set up to handle that. From an hr perspective. And to remediate, you know, to investigate it and remediate it. The question is, is the company obligated to tell the department of justice so that they can now go after that individual criminally . Of course the Department Hopes that would happen. Thats where the carrot is and the department has the hammer of coming after the company, if it can, for that employees conduct. So i think that, you know, one of the benefits to the Pilot Program is that it does encourage companies to come in and as leslie said on significant matters, matters that it, too, has determined to be significant, to cooperate and to enhance through mediation that presumably they, too, are making in the form of punishment, possibly termination and that sort of thing. And at the same time, making sure that it does not get dragged in and get indicted and hence lose the value and especially if it is publicly traded is the shareholders that will lose that value. I think that companies may, in fact, find that it is important for themselves as a corporation to go and disclose even though it has remediated and taken care of its those individuals. But not every time do i think that its necessary to go into disclose when the company has taken the remediation steps that need to be taken. What sometimes happens here is a criticism of what has historically happened and what i believe the Pilot Program is trying to address. And i dont think its been around long enough to see if its actually working in this regard is that often when a company went into disclose and disclose this incident or this scheme or this group of people engaged in x, y, z, often because this is a Conference Room practice, the prosecutor across the table from you will say thanks for that. You know, go off and investigate. Come back. Well deal with. But i also want you to look at blah, blah, blah, and it becomes a sprawling investigation. The Pilot Program i know every time she takes notes because she wants an answer. Im going to give the answer right now. The Pilot Program has a time limit or self imposed, were going to try to get this done quickly. Leslie and the chief of fraud and others have been very vocal about not wanting to boil the ocean. And that is something i do think is a very worthy effort and goal for the department. Because that will scare off companies and has scared off Many Companies from coming in and disclosing, believing that we may have to disclose profits and pay fines and we may have to pay millions of dollars in legal fees to investigate ourselves way beyond the problem and not because theres issues out there but because the department wants us to. So i think that first everyone should know to the extent that you dont already, very few companies have a legal obligation to report things like an fcpa violation to the u. S. Government. The only companies who may have an obligation are defense contractors who in certain circumstances might have to report a violation of the law if it relates to one of their contracts. And companies that are already under some kind of disposition with u. S. Government, like a deferred prosecution agreement that they agree Going Forward if something bad happens during the term of the agreement, that they will report it. They have to report that. So they have an obligation. Other companies dont have an obligation to report to doj violations of the fcpa. They may have obligations to other regulators for other violations. But they dont have that obligation for us. On the issue of the type of investigation that we expect, ive seen over the years a lot of companies that did way too broad investigations. And in my experience, that wasnt the result of what doj told them to do. Doj may say person x who paid bribes in indonesia is also the country manager in malaysia. Did you look in malaysia . But theyre not going to say if you have a bribe in china, you better look at the entire world. But ive seen companies do that. Ive seen theres one company that im thinking of that had a kind of a oneoff situation in china. And they did an investigation of the entire world. Similar situation of a company in russia. Did the entire world. They may have good internal business reasons why they want to do that. But we are not going to be the ones telling them to do that. I do think that is a change. Because i know that there have been times that its been the idea of the line attorneys to go out and look at other locations. And thats in years past. I do think that the effort and the stated objective to really be more surgical helps companies in making the decision to disclose. Because its not going to be so fearful if, in fact, not only you say it as chief of the Criminal Division and the chief of fraud and the chief of the fcpa unit, but its pushed all the way down to the line attorneys and the u. S. Attorneys offices throughout the country that you should not be boiling the ocean and you should stay surgical on the issues thats at hand. There are some cases that you do have to boil the ocean but those are few and far between. Can we shift the focus a little bit now to something you addressed, miss caldwell, and that is the relationship with other states around the world . We have a couple major treaties, the oecd convention, we have the u. N. Convention dealing with anticorruption. What is the relationship again between these treaties and the departments enforcement of the fcpa . We work very closely with were a member of the oecd working group on bribery. We go to all the meetings. We participate very closely with them. We brainstorm with them and other member countries. We also work with the countries involved in the u. N. , the u. N. Effort. We have informal relationships in addition to treaties with countries all over the world. We have information sharing. The fcpa area has really helped us across the board in the Criminal Division because the relationships that we formed with Law Enforcement and with regulators in a lot of other countries has really helped us investigate a lot of other kind of cases. This is one example. A really important example that we see every day is cyber crime. The relationships that we we developed in the fcpa space have translated into relationships with cyber investigators and cyber crime to me cyber crime is the thing that keeps me up at night as the aeg of a Criminal Division. Its the scariest thing out there. It pervades everything. So the relationships have really helped. We have formal relationships through the treaties and then we have a lot of informal relationships, prosecutor to prosecutor, agent to agent that have really helped us expand. And the other thing that i think our example in the fcpa space has led a lot of other countries to take anticorruption more seriously and to bring their own actions. I mentioned the saudi arabia and brazil example. They prosecuted a corrupt official based on evidence gathered. So the International Relationship is critical in the treaty and nontreaty context of the prosecution of the cases but a lot of the cases we do these days. So, leslie, if i could just follow up on a couple of questions in that regard. As defense counsel representing a company who may have an issue in another country, one of the questions that is always considered in whether you go in to disclose is, is the government going to find out about it. Is the u. S. Government going to find out about this issue . Lets say this hypothetical in this other country your client sub does have a local investigation going on into the very issue. Could you tell us i know that even your predecessors emphasized collaboration with other governments. Is there a lot more and is it continuing to grow that prosecutors are actually picking up the phone and calling each other . Does it in fact happen that a prosecutor in another country will pick up a phone and call into doj and say weve got this issue with one of your u. S. Companies . Yes, that happens and probably more frequently it happens that Law Enforcement in one country will call us or we will call them. That happened in a case we have recently done involving venezuela government officials of Venezuelan Oil company that were taking bribes. We recently prosecuted several individuals in connection with that case. It happened in various cases. I think its probably pretty rare these days when theres a really big fcpa case that its not multijurisdictional and were not working with or speaking to and reaching out to foreign officials. Yes. Thats just going to keep getting more and more pervasive. Are there certain countries where the relationship between our prosecutors and their prosecutors are pretty tight, where theres a lot of back and forth . Yes. Many of the european countries, but also some countries you might not expect such as indonesia. We do a lot of back and forth with switzerland notwithstanding switzerlands reputation of not wanting to work with other countries. We do a lot of work with the uk, with the netherlands, a lot of work with scandinavian countries. There are certain countries we dont really do work with, for example, russia, china. Although i have to say china very recently has started being much more proactive internally in anticorruption cases and taking them much more seriously. We have a matter right now that involves cooperation with china which is pretty, pretty new. Well see how that goes. The same vein, i think i recall because i think attorney general eric holder announced it in a speech before that there have been meetings with the prosecutors from various countries that have come together to share strategies, techniques, that sort of thing. Are those meetings still happening . Yes, in fact they happen all the time. I would be surprised if theres not someone from the Money Laundering section sitting in brazil on some other country. One good example is the fifa investigation, the world soccer governing body. Thats something thats involved countries from all across the world. A lot of collaboration, a lot of discussion among prosecutors and investigators. Another thing that we try to do is when were doing something where there are multiple jurisdictions involved we try to make it where the company has one big resolution so theyre not paying us 100 of the penalty and switzerland 100 of the penalty. And the sec 100 of the penalty. We try to make it like a pie. We try to make the pie the right size and divide up the pie. We cant always control that, but we try the control that. In fact, the people we have the must trouble controlling that are u. S. State regulators. As a defense counsel, when were trying to assess disclosure, obviously were assessing the government may find out about it and were in another country trying to figure out are those local authorities going to learn about it, are they going to pick up the bat phone and call doj or is the s. E. C. Or is the press going to find out about it. I know u. S. Prosecutors look at the newspapers and figure out where to serve subpoenas. I remember that when i was in the Eastern District in new york. In fact, i might have learned it from you when you were my chief. Are you using a mechanism at department of justice to monitor foreign newspapers . Yes. We follow foreign reporting just as we follow u. S. Reporting. We recently learned about a really cool app that somebody has at the again geneva airport. This is in our initiative. The app monitors the tails of private jets that land at the geneva airport. It identifies the owner of the tail, looking at the tail it identifies the owner. We learned one of our targets, who is the current Vice President of Equatorial Guinea i tell you this because this is all public knowledge. We have seized a lot of his assets, including one of my favorite cases, United States versus one Michael Jackson bad tour glove. He was collecting Michael Jackson memorabilia. One of the things he had was the little white glove. Anyway, his plane landed in geneva last week. And it was there for about an hour and then it left. We know about that because of this app that somebody created. The app records the tail number and it says dictator from name of that country landed in geneva. Dictator departed geneva. Oh, my goodness. Geneva is lovely, but you usually go for more than an hour. In that vein, in the law faculty we offer a course on antiMoney Laundering. And they have a game on chasing the assets. How do you chase the assets because for the next generation of lawyers learning these tools, i dont think the app is in the game yet. Thats a wonderful revelation. Can i ask you, are there situations where you would simply defer to a foreign prosecution . Say they have the resources. It appears theres a lot of activity that occurred in the foreign country. We trust them to get this right, but to be vigorous and fair in their prosecution and therefore not allocate our resources that way . Yes, we do. We do that all the time. The key to that is vigorous and fair. I lot of countries dont have fair or vigorous anticorruption schemes and so we may not have confidence anything is going to happen in the other country. We also dont Want Companies to form shop to go to a country that doesnt have strong anticorruption enforcement and try to use that as a shield against us doing something when we have a stake in what was done in the underlying criminal conduct. We defer all the time. For example, the individuals were being prosecuted by saudi arabia and brazil. There was no reason for us to also try to prosecute those individuals. In another case we resolved the case with the netherlands. We did part of the case. They did part of the case. So we do that all the time. Great. I have been reading in the press just concerns about the enforcement not just in the fcpa but in other areas of u. S. Laws abroad and the perception that perhaps the United States is delving too far into foreign legal systems. This could be hurting Business Activity in a profound way, the notion that the United States has now become the world police. How do you address that allegation . So we dont have time to be the world police. We really only focus on things that affect us. One example where we were accused of being the world police, when i first started, the department was negotiating a resolution with a french bank. Bnpp was very vocal to the degree of taking out newspaper articles and having president holland trying to raise the issue with president obama about the fact we were prosecuting the bank and targeting french companies. In fact, theres been some french legislation proposed to try to thwart us from doing that. Germany may think were doing the same thing with germany. The volkswagen case, its an ongoing investigation. I wont say more than what has been in the press. Vw sent cars to the United States knowing that they violated our environmental laws, lied about it, and put those cars out on the road, hundreds of thousands of cars. Should we be prosecuting that . Should we be looking at that . Bnpp was dealing with iranian and sudanese clients. They had a very Large Business line dealing with countries sanctioned by the United States. They were dealing with those countries not outside our borders, but using our Banking System and using our banks. They had internal compliance memos where the compliance people would write emails which we had saying this violates u. S. Sanctions law. This is illegal. They sought opinions from two u. S. Law firms. Is this illegal . The law firms said yes and they kept doing it. They decided it was more important to get the money from the business than to follow what they viewed as a political u. S. Law, the sanctions regime. So i think that we try to keep our focus on cases where it does affect our system. We dont want our system to be used to evade sanctions. We dont want our system to be used for dirty money, as a haven for dirty money. We dont want our companies to be disadvantaged when other companies are paying bribes all over the world. I dont think were out there prosecuting things we barely have jurisdiction over. Were really trying to focus on the things that we have a real interest in. Ill say from a defense perspective that the jurisdictional question is one that you really need to stay focused on whenever you are asked to assist a company in looking into an allegation of wrongdoing. Because if theres conduct abroad, no u. S. Folks involved, very little touch to the u. S. , if any, it has been my experience and also my understanding from others that that kind of argument really in todays fcpa group really can resonate and it should for the reasons leslie has just said. The department of justice should not be the global police, but it is especially when youre doing an internal investigation, it can be very, very tedious in terms of finding evidence that theres no jurisdiction. It can be very difficult because youre basically trying to prove the negative. But i encourage folks who are in this practice to from the very beginning to really focus on the jurisdiction or lack thereof because it can make a huge difference in the end result. Great. Thank you. We have about 25 minutes and have ample time for questions from the floor. I have additional questions as well, but i see we have students from around the world who are here. We have i know members of the press that are here and of course members of Government Agencies and from private law firms. If you have a question, please raise your hand and shell get the microphone to you. If you could introduce yourself, we would appreciate that. We werent shy, so dont be shy. Im with a publication called Global Investigations review. Are you able to talk more about the cooperation you were talking about with the china case in terms of what type of case is it . Could you talk a little bit more about what that cooperation involves . I cant talk about specific cases because theyre ongoing, but we have cooperation with china in a corruption case. We have cooperation with china in a corruption case. We have cooperation with china in an intellectual property case. And we have some cooperation with china in a cyber case. Its spotty. Its early. Its too soon to say whether this is a brave new world where were going to be working hand in hand with china on a lot of things. The chinese economy is a huge economy as is ours, and we have a lot of mutual interests in protecting intellectual property and preventing bribery. We are starting to do a little bit of work with the chinese. Its also been my experience that the Chinese Government has become more aggressive in enforcing its own laws. The ava, and i was on the Planning Committee for, but the aba hosted its first white collar conference in conjunction with the bar in china and this was last fall, last november in shanghai. A number of prosecutors and judges and defense bar from china were there, and there was a lot of talk about how aggressive not only is the government now but how they expect to continue to grow, which i do think that means theres going to be more collaboration with the u. S. Authorities. And given how the u. S. Economy and u. S. Companies are going there and are there, i certainly think its prudent as the member of the defense bar to be counseling clients to make sure you have very good compliance programs in operation, this includes ratcheting up issues at headquarters so they can get addressed. Ive seen situations where raids can happen and headquarters necessarily doesnt know about it for a while. Karen, are you talking in the context of International Companies in china . Yes. So doing business around the world . Yes. I have a question about the chinese. Introduce yourself, please, matt. Please introduce yourself, where you are from. My name is matt. Im from china and im an International Law student here. My question is regarding the cooperation between america and chinese about corporations. Especially the fcpa. I know now that Chinese Governments have become more and more aggressive attacking corruption issues, but on the other hand so many people talking about the Chinese Government attacking anticorruption. The campaign is to attack another part of Chinese Government, some government officials with different opinions. It is obvious the government started several years ago. Why do you possibly review the corruption information to you . Especially under fcpa. How do you evaluate whether you should charge those corporations . Do you take a holistic view . Do you take some political consideration . Not just in the fcpa, but in corruption cases, generally, we often see other countries accusing people of corruption. Sometimes the people who live in the United States are accused of corruption in the country where they came from and we have to see whether we get for example, there might be a prosecution of that person in the other country and the country may be seeking extradition for that person to be sent back to china china is a bad example, but a country where we have a lot of extraditions going back and forth. We have to figure out whether and i will use mexico as an example. We have a lot of extradition with mexico. We have to figure out if this is a political case or is this a real criminal case before we extradite the person to face charges. We definitely kick the tires when we hear the allegation that a person is corrupt. We have seen an evolution in china from nonenforcement to anticorruption to arbitrary enforcement of anticorruption to i think were seeing now a more even handed, still not perfect, but more even handed enforcement of anticorruption. Im not an expert on china or its anticorruption efforts, but i think part of the reason were seeing that is china realizes if it wants to be a leader in the Global Economy, it has to be more transparent and less corrupt. Very interesting because it does raise the issue of having skills in your office to deal with political issues and understanding the politics in a country too. Yes, sir. [ inaudible ] from reuters. This is a followup on the last question. China is a country that people are tortured in detention, particularly sometimes political opponents. They have trials that are bogus. Its a very obviously from a u. S. Perspective, its a very flawed justice system. How do you make sure if youre sharing information with chinese authorities on corruption investigations that its not going to end up being used for types of activities that would frankly violate u. S. Standards or just be really embarrassing for the u. S. . So i dont know that weve had an example where if we have, i dont know about it. An example where weve shared information with china or another country and theyve used that information to persecute somebody or torture somebody in this corporate context. And i think that we dont our relationships with our foreign counterparts, investigative counterparts and Law Enforcement counterparts, tend to grow in baby steps. It has to be a matter of trust. Ill give you an example from just a few years ago. We had a very contentious relationship and lack of trust relationship with of all entities the u. K. Regulators. We were fighting with u. K. Regulators. We didnt trust them. They didnt trust us. And weve gradually because weve worked on a bunch of cases with the u. K. Developed a really good working relationship with the u. K. To the point where were considering embedding one of our prosecutors in one of the u. K. Law enforcement agencies to sort of help those relationships. With these other countries that we dont have a longstanding relationship, we have to develop the trust and the confidence that whatever enforcement action they might take is a real one, an appropriate one, and a fair one. Were not interested in feeding political dissidence to china and other countries. So that they can be abused inappropriately. Were cognizant of that. We really want to understand whats going to happen and what the system is before we provide evidence that could be used in a trial to another country, including even the u. K. Can i follow up with a question . Karen, is this an issue in your daytoday practice . Nothing specific, but the kind of political ramifications that were raised from the question. I certainly think that companies establishing and operating their compliance programs in dealing with allegations of wrongdoing and then making the kind of disclosure decisions that we were talking about earlier all need to factor in those issues. The issues that are swirling around that particular country and enforcement climate. Right. I want to move off of china a little bit and go back to the transparency you were talking about. The recent settlement papers have all included the guidelines calculation when it comes to penalty, which i think a lot of people appreciate that aspect of transparency. But what i have noticed a lack of is a discussion of how the number that represents the proceeds of the crime has been arrived at and same thing when it comes to calculating disgorgement. I was wondering if you could talk a little bit about how that number gets calculated and arrived at. Speaking like a lawyer, it varies from case to case, but i think the disgorgement amount is usually the profit. If you pay a bribe to get a 2 Million Contract and your profit on that contract is 1 million, you have to disgorge that 1 million. There are criminal fines and penalties which are in addition to whatever you made off the contract and those depend on a variety of factors. All of which are in the philip factors and the guidelines. How pervasive was the crime, who was involved, was the company a recidivist. There are a lot of factors that are considered and it is very case specific. So when we reference the guidelines, we should be referencing whatever application notes of the guidelines we considered, which we may not say the third time the we probably would say that, but we probably wouldnt say this went up to the ceo level, but well reference the notes. If you want to go look them up, you can see what exactly those are referring to. Were trying to be as transparent as we can without putting every single fact in. And making the documents too unwielding. Can i make a comment about the transparency point thats set forth in the documents . Earlier, i said i had some concerns with the Pilot Program and the detail thats in some of these letters causes me to have concern from the perspective of it may actually deter some companies from wanting to disclose if in fact they think their arm is going to get twisted by the department of justice to agree to the publication of that letter. I know that theres been already talk in the defense bar and within Corporate America as to does the department require you to agree, is it part of the settlement discussions, even if they say you dont have to agree is it expected and are you going to feel pressure. As a result, i do think that that type of transparency that is public could be a deterrent because you necessarily would not see all of that detail in a public document, especially if say, for example, youre a privately held company and you otherwise wouldnt have any sec type disclosure. So one thing that i would encourage the department of justice to consider doing and ill ask leslie on the spot if anyone is thinking about this, and that is obviously transparency when youre negotiating a settlement is very important for the lawyer across the table from you to have a robust and truthful and transparent conversation on how the arrive at these numbers so you get a fair settlement. That is very important and very good. To then take it the next step and put it out into the public so that the rest of the world can see it, i see some good to that if in fact youre not twisting the arm of a company to do it. It obviously tells the rest of us how doj has arrived at something. But if theres undue pressure, what i would encourage the department of justice to do is do it on a no name basis. Publish the detail. Publish the information as to the outcome, but dont give the information about what company is at issue. That would still serve the purpose of being informative and also could attract the disclosures the department is seeking. So i think weve had this conversation within the department about how much detail should be included under the Pilot Program if theres a declination. I think the cases youre talking about we had declinations with two private companies. Normally when we do fcpa cases, most are Public Companies and most are with the sec. In most cases where we declined, the sec will file an action. It will be an action in which the company will probably neither admit liability. But they agree to disgorge so much money. That is a public document. When the department gets disgorgement from a company, its because this was the case with the two Companies Recently theyre not subject to the jurisdiction of the sec. But we feel very strongly under the Pilot Program we cant let them keep the profits that they got through an admitted bribery, but we dont want to have secret disgorgement arrangements with companies. They are not subject to the jurisdiction of the s. E. C. But we feel very strongly under the Pilot Program, we cant let them keep the profits that they got through an admitted bribery. But we also dont want to have secret disgorgement cooperation with companies that the country doesnt know they have entered into a disgorgement agreement. So karen wants to have full transparency of what the result is likely to be but doesnt want anyone else to know about it. Or at least that her client had the result. Which is what i would do too, if i were in his shoes. But from our perspective, the benefit of the Pilot Program is we could put out there in detail, much less detail than the s. E. C. And if we were entering into some other kind of resolution like a nonprosecution or deferred prosecution but to still though that a bribe was committed and bribe was paid and business as a result of those bribes and notwithstanding the fact that this company violated the supposed dodd under the Pilot Program, they are going to get a benefit. They can decide whether they want to participate in that program. They can decide its not worth it to them to have their name out there in a two or two and a half page letter as opposed to a long detailed agreement, but from our perspective its very important to be transparent not just with the companies, but with the public about what were doing and why were disgorging money from the company. In the wake of those two recent resolutions, we have gotten quite a number of calls from companies because we laid out the fact in one instance there was 500,000 in bribes paid. We gave a declination. That, i think, has resonated with a lot of companies. Oh, i didnt think we would get a declination if we had 500,000 in bribes. We think its a good thing. I understand why companies wouldnt necessarily want it. The benefits of the Pilot Program are worth the relatively mild pain of that. I think you really have to compare it to what you would normally get in an sec resolution if the sec were involved in the case. Leslie, are you saying it is in fact a requirement that a company must do you even ask for the consent . Our position is the resolutions should be public. If the company is going to be required to disgorge, we dont want that to be something thats done in secret. We want that to be done in public. We feel that we hear all these different voices. We hear people saying all youre doing is extorting money. There are companies that are willing to pay money if we would just keep quiet and go away. Thats not how we want to operate. We want to show a basis of why this company is paying this money, a bribe was paid, the law was violated, but the company did everything we asked them to do under the Pilot Program and now theyre getting a benefit. World, heres what were doing and why. We think it is really important they be public. I dont know that weve ever i dont know enough about the dynamic in those two cases that did we demand he had do it against their objection because we think it is appropriate. What lesley said whats going to happen then is is what happens any time you are negotiating a deferred prosecution agreement is that you are going to be debating the language. The declination letter is turning into something between what we used to get in a declination when there wasnt disgorgement because the one thing the Pilot Program has brought to the table is there has to be disgorgement between privately held companies. Previously you could get a declination without that. You get a short, sweet letter. Never be made public. Now weve got the Pilot Program thats given us something between that, what it used to be like and the nonpros and deferred pros where you now have a letter that is, in fact, going to be made public that has language about the conduct. And its important as to defense counsel that you, because this is what you do whether its the s. E. C. Or doj, the nonpros, is that you try to really address how the language is going to read because the impact it can have on your brand, it can have a tremendous impact on your company, whether youre publicly held or not. So its it is, you know, something that companies, when companies are trying to evaluate whether to voluntarily disclose, participate in the Pilot Program or not, you know, these are factors that they should consider and would consider. Great. Hi. Im dan. Im a law student here at gw and my question is about disgorgement and if there was a violation the fcpa and then there was a profit and the company has paid taxes to the government on that profit. How are those taxes factored into the disgorgement and whats the rationale behind that . So, sadly, most companies dont pay taxes on income that they earn overseas or they pay very little taxes, but we would not take that into account. We would require disgorgement of the entire profit, but i honestly have never seen that scenario because most Companies Operating overseas dont pay taxes, certainly not taxes attributable directly to that transaction. Im ben and im coming from miller. The question i have related to disgorgement as well as the Pilot Program is that to what extent can we assume that the real historical declinations that always were a sweet and short letter nowadays will pretty much be cases where there is very little evidence of an actual bribe, and the reason i say that is because it seems to me that if you hear about a case and the company, lets say, refuses to participate in the Pilot Program and refuses to disgorge, you will not allow them to have a short letter or a declination anymore. Im trying to see the line. So i think we still do declinations in cases where for whatever reason we cant prove our case. So we may conclude a bribe was paid but we lack jurisdiction, so we may decline prosecution for that reason. We may think that the circumstances were very suspicious, but we cant we couldnt prove a bribe at the end of the day. So we might issue a declination, and those would be short declinations. The kind you were talking about. Its only when we conclude that the company has violated the fcpa and theyre reaping the benefits of the Pilot Program that we feel that we need to if we conclude that they have violated the fcpa and they should disgorge. For example, if we dont have just diction, were not going to be asking for disgorgement. If we dont think that we could prove there was actually a bribe as opposed to money went missing and we dont really know where it went, it could be corrupt employees embezzling, were not going to ask for disgorgement, but when we think we can prove there was a bribery and were going to decline prosecution because the company did everything we asked in the program, we think its very important for us to lay out that there was a crime and that because of the companys conduct and the way they addressed the problem, were going to decline prosecution but theyre going to give back their profits. We have time for one more question. Thank you. Im mark. Im a reporter. I have a question for you about restitution. At the last big conference of the uncapped countries, a number of countries put forward a resolution in essence asking that the developed countries make available part of the proceeds in fcpa cases, and in particular i believe some of those countries wanted to be able to participate in settlements as theyre being negotiated. Has that issue come to the fore in the department, and what is the departments view on that . Thank you. So i havent heard that exact issue in the fcpa context. We see that issue or a variation of that issue in the kleptocracy context where, for example, when we seized 800 million in Swiss Bank Accounts that belonged to the corrupt uzbeki official, there was one claimant to that money, the government of uzbekistan. So we see that. Thats obviously something that the people who were involved in the wrongdoing were associated with the government of uzbekistan, so we would have to we wouldnt necessarily be willing to agree to give the money back to them because they might just put it back in a different pocket. So in the kleptocracy context, thats a typical thing, where the government, wherever the corrupt official was, that government will claim an interest in the funds, so we do deal with that. We generally fight that. We recognize that the entire government is not corrupt and that the government itself was a victim in some way of the corruption of its official, but we try to work to get the money to the extent were going to give be giving money back to the count, we work to get the money back to them in a different way so we can be sure its not going to be used by the corrupt officials just to be put back in a different swiss bank account. I havent seen it in the fcpa context but i could see sort of similar rationales might apply, that we dont want to give bribe proceeds we dont want to give money that was paid to get contracts through bribes back to potentially the same officials who got the bribes. Well, please join me in thanking Leslie Caldwell for this wonderful presentation, particularly with regard to transparency as to the work they do on a daily basis, but the fact youre here and talking about these important issues, and from the thank karen popp for the perspective from practice, and i think that we were able to get a nice balance on the issues and something that i think developed the issues with the perspective from the government and from the private sector. So thank you very much for coming. Please join me in thanking the panelists. [ applause ] and we will have a reception were asking students to participate in this years student cam documentary competition by telling us, what is the most urgent issue for our next president , donald trump, and Incoming Congress to address in 2017 . Our competition is open to all middle school and high school students, grades 6 through 12. Students can work alone or in a group up to three to produce 5 to 7 minute documentary on the issues selected. A grand prize of 5,000 will go to the student or team with the best overall entry. 100,000 in cash prizes will be awarded and shared between 150