Category: Criminal Defense

Electronic Recordkeeping—The Maritime Industry, Including in the United States, Sails Forward

Jeanne M. Grasso and Dana S. Merkel

NEW DEVELOPMENT

Long-awaited amendments to the International Convention for the Prevention of Pollution from Ships (“MARPOL”) entered into force on October 1, 2020, which expressly permit the use of electronic record books for certain MARPOL required logs. Although the United States reserved its decision regarding adoption of the amendments when they were approved by the International Maritime Organization (“IMO”) in May 2019, the United States ultimately accepted their adoption in accordance with the tacit acceptance procedure. Nonetheless, it is yet unclear how the amendments will be implemented in the United States or what additional security safeguards the United States may require. Bottom line, this is a significant and welcomed development.

BACKGROUND

Electronic record books have been the subject of much debate and consideration at the IMO and within the United States for a number of years. During MEPC 74 in May 2019, amendments were approved, revising MARPOL Annexes I, II, V, and VI to allow the use of electronic record books approved by the vessels’ Administration for the Oil Record Book (“ORB”), Cargo Record Book, Garbage Record Book, and Annex VI air pollution prevention recordkeeping requirements. In adopting the amendments, the IMO stated the use of electronic record books “should be encouraged as it may have many benefits for the retention of records by companies, crew, and officers.” These amendments entered into force on October 1, 2020, although a number of flag States believed the previous MARPOL language provided them with the discretion to allow the use of electronic record books and had already approved their use on vessels for some years. Even so, the permissibility of using electronic record books to meet MARPOL requirements is now clear.

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The Maritime Industry: The DOJ FCPA Unit’s Next Port of Call

Carlos F. Ortiz, Mayling C. Blanco, and Alexandra Clark

The maritime industry, by its nature, involves the movement of goods and vessels across international borders, and requires routine interaction with government officials. Historically, many in the industry viewed bribery of these officials in many parts of the world as a “cost of doing business.” Increased cooperation between the U.S. government and foreign governments has led to intensive efforts to investigate and fight corruption across the globe. Recent actions by the U.S. Department of Justice (“DOJ”) and the U.S. Securities and Exchange Commission (“SEC”) in the maritime-related oil and gas industry make it clear that Foreign Corrupt Practices Act (“FCPA”) enforcement may soon take a closer look at the maritime industry.

As a preliminary matter, for over a decade, the oil and gas industry has been the focus of investigation and has seen more FCPA enforcement actions than any other industry.1 Continue reading “The Maritime Industry: The DOJ FCPA Unit’s Next Port of Call”

DOJ Urges U.S. Companies Acquiring or Merging with Foreign Companies to Self-Disclose FCPA Misconduct Identified during Due Diligence

Carlos F. Ortiz, Shawn M. Wright, Mayling C. Blanco, and Alexandra Clark

In a keynote address at the Ninth Global Forum on AntiCorruption Compliance in High Risk Markets, Matthew S. Miner, Deputy Assistant Attorney General of the Department of Justice’s (“DOJ”) Criminal Division, urged U.S. companies merging with or acquiring foreign targets to voluntarily disclose potential misconduct to the DOJ pursuant to the revised Foreign Corrupt Practices Act (“FCPA”) Corporate Enforcement Policy (the “Policy”).

As previously reported by Blank Rome, the Policy incentivizes companies to voluntarily self-disclose potential FCPA-related misconduct, fully cooperate with the government’s investigation, and remediate the alleged misconduct through a robust compliance program. Companies satisfying these three criteria are entitled to a presumption that the DOJ will resolve the case through a declination. Continue reading “DOJ Urges U.S. Companies Acquiring or Merging with Foreign Companies to Self-Disclose FCPA Misconduct Identified during Due Diligence”

FCPA under the New Administration

Mainbrace | October 2017 (No.4)

Mayling C. Blanco, Carlos F. Ortiz, Shawn M. Wright, and Ariel S. Glasner

 

 

 

The single most frequently asked question by our international clients over the past several months is whether there will be changes in white collar prosecution priorities under the new administration, specifically with respect to the Foreign Corrupt Practices Act (“FCPA”). The FCPA, which criminalizes the payment of bribes to foreign officials around the world, has been subject to enforcement trends and scrutiny during its 40-year history.

Continue reading “FCPA under the New Administration”

The Global Anti-Corruption Corner: A Primer to the Foreign Corrupt Practices Act

Mainbrace | June 2017 (No. 3)

Shawn M. Wright, Carlos F. Ortiz, Mayling C. Blanco, and Ariel S. Glasner

 

 

 

Any company doing business abroad is subject to the long reach of the Foreign Corrupt Practices Act (“FCPA”). Small or privately held companies, just like large or public companies, are subject to the criminal specter of the FCPA. The operative inquiry is whether the company is operating and/or transacting any type of business abroad with the government, government-owned entities, or involving foreign officials—either directly, through joint ventures, or indirectly, through agents. A foreign official also includes employees of entities owned by the government.

Although the FCPA was first enacted in 1977, it was not widely enforced until the turn of this century; since then, the law has resulted in a steady flow of significant corporate settlements. Indeed, in approximately the last two decades, enforcement of the FCPA has increased exponentially, with the second-largest number of enforcement actions having been brought in 2016 (2008 had the greatest number). Before the FCPA, no country considered bribing a foreign official for business purposes to be illegal—it was simply considered a cost of doing business abroad. The United States was the first country to outlaw the practice and recently published a comprehensive resource guide to compliance with the act.

Continue reading “The Global Anti-Corruption Corner: A Primer to the Foreign Corrupt Practices Act”

Red Sky in Morning: Seventh Circuit Reverses Seaman’s Manslaughter Convictions

Mainbrace | January 2017 (No. 1)

Gregory F. Linsin and Emma C. Jones

A December 2016 United States Court of Appeals decision highlights a recent, troubling trend of aggressive criminal prosecution of vessel owners and crew members following marine casualties involving a fatality. In a remarkable opinion, the Seventh Circuit in United States v. Egan Marine Corp. overturned the criminal convictions of a tug owner and the tug’s master for violation of 18 U.S.C.A. § 1115, colloquially referred to as the “Seaman’s Manslaughter statute.” Nos. 15-2477 & 15-2485, 2016 WL 7187386 (7th Cir. Dec. 12, 2016).1

Continue reading “Red Sky in Morning: Seventh Circuit Reverses Seaman’s Manslaughter Convictions”

DOJ Announces FCPA Pilot Program in an Effort to Incentivize Companies to Self-Report Misconduct

Mainbrace | June 2016 (No. 3)

Shawn M. Wright, Carlos F. Ortiz, Steven J. Roman, Ariel S. Glasner, and Mayling C. Blanco

 

 

 

On April 5, 2016, the chief of the Fraud Section for the U.S. Department of Justice’s (“DOJ”) Criminal Division issued a memorandum related to the DOJ’s prosecution of violations of the Foreign Corrupt Practices Act (“FCPA”). The memorandum highlighted the DOJ’s efforts to intensify its prosecution of FCPA violations by (1) increasing the Fraud Unit’s stable of prosecutors devoted to FCPA issues by 50 percent and creating teams of special FBI agents focused solely on FCPA matters, and (2) strengthening the DOJ’s collaboration with its foreign counterparts in order to combat bribery schemes worldwide. The memorandum also announced the start of a one-year pilot program designed to incentivize companies to voluntarily self-disclose FCPA-related misconduct. Continue reading “DOJ Announces FCPA Pilot Program in an Effort to Incentivize Companies to Self-Report Misconduct”