Welcome to This Week In Compliance: GAN’s weekly news roundup, where we curate the latest stories on compliance and anti-corruption to keep you informed. This week we cover FCPA enforcement updates from 2020, and Tencent's corruption case in China. Read the full story and more news below:
FCPA Enforcement Hindered in 2020:
Global law firm Goodwin released a report on the enforcement of the Foreign Corrupt Practices Act (FCPA) during 2020. The report, which analyzes key trends, enforcement actions, and FCPA cases of 2020, indicated an overall decline in FCPA enforcement actions compared to previous years, but higher gross fines in the prosecuted cases. The report also pointed that the increase in whistleblower reports to the SEC might mean a higher case-load for 2021. Goodwin further reported that cross-border enforcement soared, a trend that is expected to continue in 2021 with the Biden administration's focus on international cooperation.
Tencent Executive Investigated for Corruption:
Chinese giant Tencent Holdings Ltd announced that one of its senior executives, Zhang Feng, is the subject of a corruption investigation led by Chinese authorities. Authorities are investigating a media report that accused the executive of sharing personal data from WeChat, which Tencent owns, to a former security minister without authorization. The investigation relates to a larger high-profile corruption case involving former top-law enforcement officials. A Tencent spokesperson stated that the allegations relate to 'personal corruption' and are not related to WeChat.
SF Contractor to be Sentenced In Federal Corruption Probe:
A San Francisco based construction contractor pleaded guilty to bribing a former public work director with a Rolex watch worth USD 36,500 and to lying to public prosecutors. Prosecutors ordered Florence Kong, the contractor, to a one-year prison sentence. Kong's arrest forms part of a more extensive investigation into corruption in San Francisco's city government. According to the authorities, Kong provided wrong information about the case repeatedly.
Warrant Served on UK law firm Over Alleged 1MDB Assets:
The U.S. Department of Justice (DOJ) issued an arrest warrant of property or assets on elite law firm Clyde & Co. over its involvement in the 1MDB case. The warrant accuses the law firm of being a facilitator of corruption, as it identifies a bank account held by the law firm with USD 330M at a NatWest Bank. According to the DOJ, the law firm helped funnel funds from the fraud committed in the 1MDB scandal where more than USD 4BN of public money was embezzled. The DOJ recovered most of the embezzled assets and stated that Clyde & Co is "about all that is left of the proceeds."
U.S. Prosecutors Investigate Honduras President for Taking Drug-Related Bribes:
U.S. authorities are investigating Honduran President Juan Orlando Hernández for allegedly taking bribes from a drug trafficker in exchange for criminal protection. Hernadez has already been involved in several drug trials in the U.S., but this is the first public one. Honduran authorities denied everything.
Israeli PM Netanyahu Pleads "Not Guilty" to Graft Charges:
Israeli Prime Minister Benjamin Netanyahu pleaded 'not guilty' in a long-running corruption trial against him. In 2019, Netanyahu was charged with bribery, fraud, and breach of trust. Netanyahu commented on the trial on his personal Twitter account, stating that the investigation against him was related to the upcoming elections at the end of March.
South African Probe Finds Evidence of Corruption in COVID-19 Contracts:
South Africa's Special Investigation Unit (SIU) launched an investigation into COVID-19 related fraud in July after a whistleblower complaint. The investigation found that public spending in South Africa in relation to coronavirus was fueled by price inflation, fraud, and political pressure. The SIU revealed the existence of multiple shell companies committing tax fraud and inflating prices up to 500%. So far, the investigation analyzed a fraction of the public spending, but it is expected to be concluded in six months.