DOJ, SEC & FBI Virtual Town Hall on Foreign Bribery and Health Care Fraud Enforcement

  • Source: May 20, 2020 | Virtual DOJ, SEC & FBI Town Hall Hosted by the American Conference Institute

Treliant Takeaway:

Top officials from the U.S. Department of Justice (DOJ), Securities and Exchange Commission (SEC), and Federal Bureau of Investigation (FBI) shared important insights on overcoming additional challenges in enforcing laws against bribery and fraud due to COVID-19.

Treliant’s Corporate & Regulatory Investigation practice provides forensic accounting, data analytics, and expert witness services in investigations before the SEC, DOJ, and other government agencies. Treliant’s experts work with organizations and their counsel to investigate facts, resolve disputes, and manage regulatory challenges in environments where the level of scrutiny is high and the margin for error is low.

Article Highlights:

The following officials shared important insights on FCPA and health care fraud enforcement:

  • Robert Zink, Chief of DOJ’s Fraud Section;
  • Joe Beemsterboer, Senior Deputy Chief of DOJ’s Fraud Section, overseeing health care fraud enforcement;
  • Daniel Kahn, Senior Deputy Chief of DOJ’s Fraud Section, overseeing FCPA enforcement;
  • Charles Cain, Chief of the SEC’s FCPA Unit; and
  • Leslie Backschies, Chief of the FBI’s International Corruption Unit.

Enforcement

The officials acknowledged the difficulties arising from COVID-19 although it was noted the agencies not only have continued to investigate existing fraud and bribery cases related to the Foreign Corrupt Practices Act (FCPA) and healthcare fraud but also have opened new investigations in the past several months.

  • The agencies have adapted their investigative approach to use secure virtual platforms to conduct interviews because of the limited ability to conduct interviews in person.
  • To help overcome the lack of access to courts they are requesting judicial approvals for warrants by telephone.
  • Communications with foreign enforcement officials continue.

Priorities

The officials highlighted current enforcement priorities, including microcap fraud, offering fraud, insider trading, market manipulation, financial statement fraud, COVID-19 related fraud schemes to obtain personal information, fraudulent medical billing and frauds in connection with stimulus funds, including the Paycheck Protection Program.

  • With respect to FCPA matters, consideration will be made to distinguish between payments to retain business or related to health concerns such as obtaining personal protective equipment (“PPE”) for employees.
  • The officials acknowledged challenges with self-disclosure and cooperation requirements for companies and a common theme was early communications to discuss challenges will be most helpful in working toward reasonable solutions.
  • Potentially fraudulent activity particularly relating to COVID-19 will continue to be monitored by federal government enforcement; DOJ officials suggested significant DOJ activity in the coming months.

Compliance Expectations

The officials recognized resource constraints on companies could affect their internal controls capabilities due to COVID-19, but it was clear the pandemic will not be an excuse for compliance failures.   They outlined the following expectations in the current regulatory environment:

  • Ensure risk assessments are current in light of operational and supply chain changes as a result of COVID-19.
  • Use the slowdown as an opportunity to update policies and procedures and provide compliance training.
  • Continue to assess the appropriateness and test the effectiveness of internal controls.

Authors

Peter Osmanski

Peter Osmanski is an Engagement Director with Treliant. He is a forensic accountant with over 20 years of experience conducting fraud and misconduct investigations, providing ethics and compliance consulting, and developing fraud and enterprise risk mitigation strategies. Prior to joining Treliant, Peter provided investigative and compliance services as a Director…

Dennis Romero

Dennis Romero is a Manager with Treliant. Dennis has over eight years of experience investigating fraud, accounting irregularities, employee misconduct and bribery, as well as performing internal and external compliance audits and Anti-Money Laundering (AML) reviews for large multinational companies across a wide range of sectors including healthcare, financial services…