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International Regulatory Enforcement

Enhancing Workforce Confidence in Internal Investigations
While each company will have different approaches to reviewing potential policy and regulatory breaches, we offer five steps that companies can take right now to enhance workforce confidence in internal investigations.
CFTC Paying for a Company's Dirty Laundry: New Whistleblower Initiatives and Rewards Suggest Increased Enforcement in the Virtual Currency, Foreign Corrupt Practices, Insider Trading, and BSA Spaces
The Commodity Futures Trading Commission (“CFTC”) recently issued a series of four whistleblower alerts aimed at seeking information from would-be whistleblowers in the areas of virtual currency fraud, foreign corrupt practices, insider trading, and violations of the Bank Secrecy Act (“BSA”). These alerts suggest that the CFTC seeks to further incentivize whistleblower cooperation—particularly in areas typically policed by the Financial Crimes Enforcement Network (“FinCEN”) and the U.S. Department of Justice (“DOJ”)—consistent with the CFTC’s previously stated intent to focus its investigative resources on foreign corruption and increasingly active enforcement activity in the virtual currency space.
New German Act to Combat Corporate Crime
On 22 August 2019, the German Federal Ministry of Justice presented the draft bill for the introduction of the Corporate Sanctions Act (Verbandssanktionengesetz, the “Act"). Once the German Parliament enacts the Act, it will enhance enforcement against corporations against business-related crimes, facilitate punishment, promote internal investigations, and incentivize investment in compliance.
FATF Adopts New Anti-Money Laundering Guidelines for Virtual Assets and Related Providers
On June 21, 2019, the Financial Action Task Force—an independent intergovernmental body that develops and promotes policies to protect the global financial system from money laundering and terrorist financing—released new Guidance governing virtual assets and virtual asset service providers. The Guidance clarifies the obligations of member jurisdictions with respect to licensing, supervision, and enforcement of covered virtual asset activities and virtual asset service providers. The Guidance also clarifies the compliance obligations of private sector entities engaged in virtual asset activities, particularly with respect to the obligation to obtain, hold, and transmit required originator and beneficiary information.
Something Familiar, Something New: OFAC’s Compliance Program Framework
The U.S. Department of the Treasury’s Office of Foreign Asset Controls (“OFAC”), the U.S. agency responsible for administering and enforcing economic and trade sanctions has released “A Framework for OFAC Compliance Commitments” (the “Framework”). The Framework outlines what OFAC views to be the five essential components of a Sanctions Compliance Program: (i) management commitment; (ii) risk assessment; (iii) internal controls; (iv) testing and auditing; and (v) training. Companies engaging in cross-border transactions would be well-advised to review and update their compliance programs to ensure that they incorporate these essential sanctions compliance benchmarks.
Clarity or Confusion: New DOJ Guidance for Evaluating Corporate Compliance Programs
On April 30, 2019, the U.S. Department of Justice's Criminal Division released an updated version of its Evaluation of Corporate Compliance Programs, which provides guidance to prosecutors in evaluating a corporation's compliance program. The announcement and publication of the updated evaluation guidance, while anticipated by many, came with no forewarning from DOJ. As such, the question remains: does the new guidance provide additional clarity or just increase confusion with regard to how federal prosecutors will evaluate corporate compliance programs? Upon close review, our assessment is that DOJ's 2019 update takes the next step in providing clarity and a structure to understand what DOJ expects in an effective compliance program.
The EU is Launching "INSTEX" to Support Trade with Iran Despite U.S. Sanctions
France, Germany and the United Kingdom—backed by the EU Commission—announced the creation of INSTEX SAS (Instrument for Supporting Trade Exchanges), a Special Purpose Vehicle aimed at facilitating trade between EU companies and Iran, in the attempt to prevent the effects of the snap back of U.S. sanctions targeting Iran.
EU Screening of Foreign Investments
The European Union negotiators reached a political agreement on an EU framework for screening foreign direct investment and introduced an alert mechanism enabling to act on short deadlines and utmost confidentiality.
The Blocking of Digital Currency: A New Phase of Sanctions Enforcement
On November 28, 2018, the U.S. Department of the Treasury's Office of Foreign Assets Control (“OFAC") for the first time published the digital currency addresses associated with specific individuals subject to sanctions. OFAC, the primary agency in charge of administering U.S. economic sanctions programs, has the authority to block property of persons involved in “malicious cyber-enabled activities" originating from outside of the United States and who constitute a threat to national security or the financial stability of the United States. It now has used that authority in a new way: blocking specific digital currency addresses associated with two persons who assisted in a cyberattack.
French Anticorruption Agency Issues Detailed New Guidelines for Compliance with Sapin II
The new French Anticorruption Agency recently issued a set of guidelines detailing the agency’s expectations for corporate compliance programs. The guidelines, which are not legally binding but are required by France’s Sapin II law, provide public and private commercial organizations with a framework for ensuring that their compliance programs adequately protect the organizations from corruption-related risks. The guidelines are also intended to help certain commercial organizations meet the statutory requirements of Article 17 of Sapin II, which requires certain French companies to adopt identified compliance program requirements. The AFA Guidelines are far more detailed than similar anticorruption compliance guidance documents issued by U.S. and U.K. authorities. Although many multinationals may have implemented compliance programs based on international best practices previously highlighted by the U.S., the U.K., and other authorities, such companies may wish to revisit elements of those programs in light of the AFA’s most recent guidance.
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