Biden Administration Increases Efforts in Corruption Fight

Posted On Wednesday, July 7, 2021
By: Daniel P. Wotherspoon

Takeaway:

Given the Biden Administrations National Security Study Memorandum, as well as the easing of the COVID-19 pandemic, it is now an opportune time for companies to review their compliance protocols and training in order to avoid investigations and potential enforcement actions.


In June, the Biden Administration issued a National Security Study Memorandum (NSSM), which established the fight against corruption as a core national security interest of the U.S.  The NSSM directed more than a dozen government agencies to conduct a 200-day interagency review and to issue reports and recommendations on how the U.S. government could better combat corruption in five (5) major areas:

  • Modernizing, improving, and increasing resources for intelligence collection and analysis of corruption at home and abroad.
  • Curbing elicit financing by establishing “beneficial ownership” to prevent illicit actors from hiding the proceeds of corruption behind shell companies, limiting the ability of illicit actors to buy residential real estate anonymously, and closing loopholes in existing regulatory regimes.
  • Holding corrupt individuals and transnational criminal organizations accountable by building upon existing anticorruption sanctions such as the Global Magnitsky Act, bolstering criminal or civil enforcement actions, and increasing support to grow the capacity of civil society, the media, state and local bodies, international partners, and other oversight and accountability actors.
  • Building and maintaining relationships with like-minded international partners through the UN, G7, Financial Action Task Force, and similar bodies to counteract corruption from autocratic and kleptocratic governments, foreign state-owned or affiliated enterprises, and transnational criminal organizations.
  • Improving enforcement measures and focusing on anticorruption best practices in the implementation of foreign assistance programs and security cooperation.

Given this new guidance, as well as the easing of the COVID-19 pandemic, companies are well-advised to review their compliance protocols and training to avoid investigations and enforcement actions.     

Pietragallo Gordon Alfano Bosick & Raspanti, LLP has significant experience in the defense of FCPA and Qui Tam matters and assists companies and their leadership in conducting internal investigations to proactively enhance compliance in the ever-changing landscape of government enforcement actions.  We assist clients in all 50 states, the District of Columbia, and abroad. 

Beneficials Owners Be Aware

Posted On Monday, June 14, 2021
By: Christin M. Roberts

Takeaway:

In an effort to curtail corruption, President Biden’s new memorandum requires U.S. Companies to disclose their beneficial ownership to the Department of the Treasury.


One hundred and forty-one days after President Biden took office, he now calls upon 15 different agencies and offices within the government to each play a part in his administration’s assault on corruption. In his “whole of government” approach, President Biden tasks the 15 agencies and offices – which ranges from the Department of Defense, to the Office of Management and Budget to the Office of the Chairman of the Joint Chiefs of Staff – to actively participate in an interagency review to counter corruption in the U.S. and abroad.

On June 3, 2021, President Biden signed his 173rd Presidential Action, titled Memorandum of Establishing the Fight Against Corruption as a Core United States National Security Interest. After a long and contentious campaign trail, this memorandum serves as an initiation for his administration to:

  • Promote good governance
  • Bring transparency to the U.S. and global financial systems
  • Prevent and combat corruption at home and abroad
  • Make it increasingly difficult for corrupt actors to shield their activities

According to the “Fact Sheet” released in conjunction with the Memorandum, on December 20, 2021, 200 days after President Biden signed the Memorandum, the interagency review will culminate in a report and provide recommendations on how the U.S. Government and its partners can:

  • Modernize, Coordinate, and Resource Efforts to Better Fight Corruption
  • Curb Illicit Finance
  • Hold Corrupt Actors Accountable
  • Build International Partnerships
  • Improve Foreign Assistance

The true implications of this memorandum will not be known for another 192 days, but for now we know the focus on “curbing illicit finance” has a newfound federal focus: robust federal law will now require U.S. companies to report their beneficial owner or owners to the Department of the Treasury. This requirement is geared toward eliminating shell corporations and disrupting tax havens by reducing offshore financial secrecy and improving information sharing.

These proactive measures mark a bold new take on weeding out corruption; the interagency review report will determine whether new Federal legislation is necessary to implement more reforms targeted at combating illicit finance in the U.S. and international financial system. See full Memorandum on Establishing the Fight Against Corruption as a Core United States National Security Interest

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