FROM: U.S. JUSTICE DEPARTMENT
Acting Assistant Attorney General Mythili Raman Speaks at the Global Anti-corruption Compliance Congress
WASHINGTON, D.C. ~ Thursday, March 20, 2014
Remarks As Prepared for Delivery
I was honored to speak at this conference last year, and I am delighted to be here for a second year in a row.
When I spoke with you last year, I told you that fighting global corruption was, and would continue to be, a core priority of the Department of Justice. That remains as true now as it was a year ago. But now, more than ever, we are fighting global corruption on multiple fronts and in real time. We are going after corrupt individuals and corporations using all of the investigative and legal tools at our disposal. We are making clear to companies the benefits of cooperation and transparently identifying the reasons behind our corporate resolutions. We are seeking criminal and civil forfeiture to seize proceeds of corruption. And we are enlisting even more support from foreign law enforcement. This multi-faceted approach has made a difference, and it has markedly advanced our efforts to root out, punish and deter foreign corruption.
Our fight against foreign corruption is critical for so many reasons. The corrosive effects of transnational corruption are felt not just overseas, but also here in the United States. Although we may not experience as acutely, or as personally, some of the consequences of foreign bribery – such as hospitals or roads that go unbuilt because infrastructure funds are siphoned off by a corrupt official – the negative effects of foreign corruption invariably and directly are felt here at home.
For one, given the global nature of our economy, when corruption takes hold overseas, American companies are harmed. They are denied the ability to compete in a fair and transparent marketplace. Instead of being rewarded for their efficiency, innovation and honest business practices, U.S. companies suffer at the hands of corrupt governments and lose out to corrupt competitors.
But, foreign corruption also creates another very real danger for the United States that I think bears emphasis. Very simply, corrupt countries are less safe. When public officials are more interested in their own personal wealth than the prosperity of the citizens they are supposed to serve, people lose faith in political institutions; and, when there is no respect for the rule of law, civilized society falters and opportunities are created for organized criminal groups and terrorist networks. As the head of the Criminal Division, I am acutely aware of the opportunities corrupt regimes provide for criminals of all stripes, and the very real dangers they present for us in the United States. Indeed, I know from the work that the Criminal Division does – from human trafficking, to cybercrime, to child exploitation and narcotics trafficking – that transnational criminal networks rely on international corruption to gain an advantage and evade the justice system. They often choose to operate in countries governed by corrupt officials because they know that those officials are willing to turn a blind eye to their crimes. Corrupt regimes can be bought off by criminal syndicates; they are less likely to cooperate with U.S. law enforcement; and they create safe havens for organized criminals by giving them a secure base from which they can orchestrate massive criminal activity.
For all of these reasons, fighting foreign corruption is not just a choice we have made; it is a necessity. By now, the Justice Department’s commitment to fighting foreign corruption is clear – not because I am telling you so or because my predecessors have, but because our record of successful foreign bribery prosecutions speaks for itself. In just the last year, since the beginning of 2013, the department has entered into nine corporate resolutions in foreign bribery cases – including three of the top ten FCPA resolutions ever reached. Together, those nine resolutions resulted in over $730 million in criminal penalties and forfeitures. We have also this past year announced charges against 18 individuals – from CEOs of companies, to general counsels, to brokers and traders at financial institutions. And, we have launched and continued other major investigations that touch numerous industries and span the globe.
These efforts and these successes are the product of the skill, hard work and determination of the talented prosecutors in our Fraud Section’s FCPA Unit, working in tandem with federal prosecutors across the country at many of the 94 U.S. Attorney’s Offices. Together, with our partners at the FBI, the Department of Homeland Security, IRS-Criminal Investigations, the SEC and our foreign law enforcement and regulatory colleagues, we are pursuing more cases than ever before.
Notably, we also identified in the FCPA Resource Guide several instances in which we declined to prosecute companies that had detected corrupt conduct, voluntarily disclosed it and fully remediated the problem. Our decision not to prosecute in those instances demonstrates that strong compliance programs and efforts to prevent corrupt conduct will be recognized and credited. However, when companies fail to implement or enforce robust compliance programs, and they then violate the law, we will not hesitate to hold them – and their executives – to account.
This was highlighted just yesterday when Marubeni Corporation, a Japanese trading company, pleaded guilty in federal district court in Connecticut and agreed to pay an $88 million fine in connection with its involvement in a scheme to pay bribes to Indonesian officials in exchange for assistance in securing a valuable contract for the company and its consortium partner to provide power-related services in Indonesia. This is one of only a handful of parent-level guilty pleas in an FCPA prosecution by the department. And the resolution papers make clear why. As the resolution papers set out, the criminal conduct was extremely serious; not surprisingly, Marubeni did not have an effective compliance and ethics program at the time of the offense; it did not voluntarily disclose the conduct at issue to the department; it failed to properly remediate the conduct; and it refused to cooperate with the department in its investigation even though Marubeni was under a deferred prosecution agreement with the Criminal Division in connection with other FCPA violations. Under those circumstances, a guilty plea by the parent company was the fair and appropriate result – a result that should cause other companies to pay closer attention to the misconduct of their employees, the seriousness with which they try to solve a foreign bribery problem when they detect one, and their decision whether or not to cooperate with the government.
In addition to the corporate resolutions we entered into last year, since the beginning of 2013, the department has announced charges against 18 individuals in connection with their participation in foreign bribery schemes or related criminal conduct – charges that resulted from least seven separate investigations. This upward trend in the prosecution of individuals is an important one.
We have been successful in our efforts to prosecute individuals in part because we are using all of the law enforcement techniques that are at our disposal. Our commitment to aggressively utilizing all our tools was vividly demonstrated in our prosecution of a French citizen, Frederic Cilins, who pleaded guilty just last week. Cilins admitted to obstructing an investigation into whether a mining company and its affiliates, for whom Cilins had worked, paid bribes to win lucrative mining rights in the Republic of Guinea. The evidence against Cilins was, in large part, obtained through the use of a cooperating witness, a wiretap, body wires and surveillance. Cilins was caught on tape by the FBI agreeing to pay substantial sums of money to induce a witness to the bribery scheme to give Cilins documents to destroy that Cilins knew had been requested by the FBI. Cilins was recorded telling the witness, who, unbeknownst to Cilins, was cooperating with the FBI, to “destroy everything, everything, everything,” that “we need to urgently, urgently, urgently destroy all of this” and even that “it’s necessary to find a place to destroy, destroy them completely; to burn them.”
As the Cilins prosecution and guilty plea demonstrate, our FCPA investigations are no longer dependent on our ability to look back at misconduct and to piece together what may have happened years before. Rather, we are working in real time to find and stop ongoing corrupt activity. Prosecutions like that of Cilins means that those who are committing acts of foreign bribery right now should be acutely aware that the middleman they are engaging could be an undercover agent, that the telephone calls they are making may be being recorded pursuant to a court order, and that the public official they are bribing may be cooperating with U.S. law enforcement.
The Cilins case also illustrates that we are attacking foreign corruption by charging individuals and companies using a wide range of federal criminal statutes. We are using the FCPA, of course, but we are also charging, where appropriate, wire fraud, Travel Act violations, money laundering and obstruction of justice.
And, we are not only prosecuting the bribe givers, we are prosecuting the bribe takers as well. As an example, in May of last year, we charged a senior official from Venezuela’s state-owned economic development bank with accepting over $5 million in bribes from a U.S. broker-dealer to which she had agreed to direct trading business, and with laundering her bribe money through U.S. banks. In November, that official pleaded guilty to several charges, including money laundering and Travel Act violations, and she agreed to forfeit the proceeds of her criminal conduct. This comprehensive, flexible and nimble approach to fighting foreign corruption ensures that all who are involved in the criminal conduct are held to account, whether the FCPA covers them or not.
Aside from criminal prosecutions, we are using our civil authorities to strip corrupt officials of the proceeds of their conduct – and thus depriving them of the very profits that are driving the corrupt conduct in the first place. Several years ago, the Department of Justice created the Kleptocracy Asset Recovery Initiative to recover corruptly obtained monies that are hidden across the globe. Through the Kleptocracy Initiative, prosecutors in the Criminal Division’s Asset Forfeiture and Money Laundering Section (or AFMLS) work to identify the proceeds of foreign corruption, seize them, and, where possible, repatriate the recouped funds for the benefit of the people harmed by the corrupt officials.
Just a few weeks ago, as the world was transfixed watching the events in Ukraine unfold, the U.S. government quickly deployed to Ukraine an interagency team to work with Ukrainian authorities and other international partners to help trace and freeze governmental assets that may have been stolen from Ukraine. The team included prosecutors from AFMLS and agents with the FBI – the Justice Department’s experts in kleptocracy, corruption, and financial analysis – who were tasked with advising Ukrainian officials on document recovery, asset tracing and U.S. legal procedures related to the recovery of assets. That U.S. team is also partnering with other foreign governments that have sent teams to Kyiv in order to assist, including a team from the United Kingdom. To me, the fact that anti-corruption prosecutors and law enforcement agents were part of the immediate and visible U.S. and global response to the unfolding events in Ukraine made clear, if it wasn’t already, that having a robust capacity within the Justice Department to fight foreign corruption matters.
At just about the same time as those prosecutors and agents were deployed to Ukraine two weeks ago, we announced the largest kleptocracy forfeiture action in the department’s history against property owned by former Nigerian dictator General Sani Abacha, one of the most notorious kleptocrats in memory, who embezzled billions from the people of Nigeria while millions lived in poverty. We froze more than $450 million of his corrupt proceeds, and filed a civil forfeiture complaint seeking more than $550 million in ill-gotten riches, that Abacha and his conspirators had hidden around the world – including in bank accounts and investment portfolios in Bailiwick of Jersey, France and the United Kingdom. Those actions – which were taken with the full cooperation of law enforcement authorities around the world who assisted us in enforcing U.S. arrest warrants for the assets – sent a powerful message: that we are equipped and determined to confiscate the ill-gotten riches of corrupt leaders who drain the resources of their countries.
Whether through our FCPA prosecutors in our Fraud Section, our kleptocracy unit at AFMLS, or our rule of law programs that allow us to train our counterparts on anti-bribery efforts, our fight against foreign bribery is built into the structure, function and priorities of the Criminal Division and the Justice Department.
Today happens to be my last day as head of the Criminal Division. As I prepare to leave, I am certain – just as my predecessors were – that my successors will carry on that fight. And, I know that to be true because fighting global corruption has become, over several years, a baseline imperative for law enforcement. It is as much a part of the fabric of the department’s enforcement efforts as is fighting violent crime, white collar crime, and organized crime. And, for good reason: it matters.
I am so proud that the Criminal Division has been at the forefront of the fight against international corruption. We have devoted considerable resources to this critical mission and we have seen tangible benefits from our hard work. But the fight is not over. We intend to keep up our multi-front assault by using the latest investigative techniques, utilizing our full range of statutes, seeking criminal and civil forfeiture and building on our record of strong collaboration with our foreign counterparts. In this way, we will hold the perpetrators of corruption to account and continue to advance our efforts to stamp out corruption across the globe.
It has been a privilege to speak with you once again. Thank you so much for having me here.
