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 Goldman Sachs' negotiations with the DOJ over the 1MDB case. Keep reading for this breaking story and find more news below:
Goldman Sachs in talks to pay USD 2 billion fine in 1MDB probe
It was reported this week that investment bank Goldman Sachs is in advanced talks with the US Justice Department to agree to pay a fine of just under USD 2 billion, admit guilt, and installing an independent monitor to oversee and recommend changes to its compliance procedures. The settlement relates to Goldman’s role in raising USD 6.5 billion for scandal-plagued Malaysian development fund 1MDB. U.S. authorities allege that much of that sum was embezzled by billionaire Jho Low and two former Goldman Sachs bankers. Prosecutors allege that Goldman ignored warnings about Mr. Low. The agreement would not resolve the investigation with Malaysian authorities, who are separately seeking billions from the firm. It is also unclear whether other U.S. regulators would join the settlement.
U.S. Justice Department revises policy on export control and sanctions enforcement
The U.S. Department of Justice released revised guidance on its export control and sanctions enforcement in an effort to standardize its voluntary disclosure policies across divisions to incentivize voluntary disclosures and cooperation. As part of the new guidance, a company can presume it will receive a non-prosecution agreement if there are no aggravating factors. The guidance follows earlier guidance this year for other areas of corporate compliance, including guidance in July that offered discounted fines and DPAs for antitrust offenders and guidance released in October for companies that claim they can’t afford to pay a criminal fine.
SNC-Lavalin division pleads guilty and will pay CAD 280 million fine over Libya fraud
A division of Canadian engineering firm SNC-Lavalin pleaded guilty this week to a fraud charge relating to its Libya dealing between 2001 and 2011. The settlement reached saw other charges withdrawn, leading the company to plead guilty to only a single charge. The agreement settles long-standing accusations that were first raised in 2015 when the engineering giant was charged with “corruption of a foreign public official and fraud”. Prime Minister Justin Trudeau became embroiled in the case last year after he tried to improperly influence a former minister in the SNC-Lavalin affair.
Former Goldman Sachs banker Tim Leissner settles FCPA charges with SEC
Former Goldman Sachs chairman for Southeast Asia, Tim Leissner, settled civil FCPA charges with the U.S. Securities and Exchange Commission (SEC) this week. Leissner was charged with violating the anti-bribery, internal accounting controls and books and records provisions of the FCPA in relation to the role he played in the embezzlement of funds from Malaysian sovereign wealth fund 1MDB. As part of the settlement, Leisner will be banned from the securities industry permanently and he will have to disgorge USD 43.7 million. The disgorgement will be offset by the amount already paid under a forfeiture order as part of a plea deal with the DOJ last year. Leissner is still awaiting final sentencing for criminal charges he pleaded guilty to in November 2018. He faces up to 25 years of imprisonment.
Egis Avia enters into DPA in France over corruption charges
French engineering firm Egis Avia agreed last week to pay a fine of EUR 2.6 million as part of a convention judiciaire d'intérêt public (CJIP), France’s version of a deferred prosecution agreement. The allegations revolved around a contract worth EUR 4 million for the modernization of Oran airport in Algeria. Suspicions centered on a contract worth EUR 390,000 with a consulting company based in the British Virgin Islands, which allegedly remunerated several Algerian intermediaries.
Maersk’s Brazil offices raided in Petrobras bribe probe
Brazilian police raided the offices of shipping giant Maersk in Brazil this week in connection to an investigation into allegations of bribes paid to national oil company Petrobras. Prosecutors in Brazil allege that Maersk paid “at least” USD 3.4 million worth of bribes in relation to almost a dozen shipping contracts worth a combined USD 146 million. Maersk has said that it will cooperate fully with the authorities.
Uber settles federal investigation into workplace culture
Ride-hailing giant Uber resolved an investigation by the Equal Employment Opportunity Commission (EEOC) this week. The EEOC, which had been examining the company since 2017, said it had “found reasonable cause to believe that Uber permitted a culture of sexual harassment and retaliation against individuals who complained about such harassment.” As part of the settlement, Uber will set up a USD 4.4 million fund to pay current and former employees who faced sexual harassment at work. The company will also face three years of monitoring by a former agency commissioner.
Federal appeals court upholds 5.6B USD Visa and Mastercard settlement
The DOJ updates its guidance on corporate compliance programs
Founder and former FTX CEO arrested, indicted on eight fraud charges