Dec 05, 2013
Shearman & Sterling Litigation partner Philip Urofsky and of counsel Dan Newcomb authored an article in the Journal of Investment Compliance titled “FCPA Broker-Dealer Case Highlights Compliance Risks for Financial Institutions.” The article was designed to provide suggestions to the banking and finance sectors on managing FCPA risks in light of a May 2013 FCPA enforcement action against employees of a US broker-dealer.
The authors note that the May FCPA enforcement action makes it clear that the financial services industry is very much on the radar screen of both the Securities and Exchange Commission and the Department of Justice. The charges in this matter mark the first time the DOJ and SEC have pursued individuals for bribes directly related to the sale of a financial service as opposed to charges for bribes relating to the underlying investment activity of a financial business. The authors caution that “financial sector leaders will be well advised to pay close attention to their overseas activities” and suggest that limiting FCPA risk should include the development of an effective FCPA compliance program and adequate due diligence into potential third-party partners and target companies.