International - Written by on Tuesday, June 24, 2014 7:20 - 0 Comments

Jeff Knox, DOJ Fraud Section Chief on the UK US Special Relationship, Prosecution of Individuals & Self Reporting

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british pound and us dollar 20The LIBOR investigation represents watershed moment in evolution of relationship said Jeff Knox, Chief of the Fraud Section of the US Department of Justice, speaking at the C5 8th Annual Anti-Corruption conference in London.

Sitting on a panel with Chuck Duross former Deputy Chief in the Fraud Section Mr. Knox was speaking of the US relationship with the UK’s FCA and SFO.

The US has learned how to share information better, coordinate with companies conducting investigations and coordinate their approach with investigations generally.

For those of you who may wonder at this new soft and fluffy DOJ there was a sting in the tail.

‘We don’t conduct joint investigations and don’t defer to what other agencies do.’

Instead, Mr. Knox said, the relationship with other investigators acts as a force multiplier.

In an attempt to quash criticism in press reports suggesting that agencies don’t work together well he said that could not be further from the truth – US has to enforce its law, likewise the UK has to enforce its law.  They may therefore end up taking action against the same targets independently, he said.

Scotching the myth that Western law enforcement are reliant upon corporations to conduct investigations and collect evidence to enable overseas corruption prosecutions he pointed to recent investigations where the DOJ had conducted the investigation itself.

Citing  the recent Marubeni guilty plea he said that the DOJ conducted that investigation with very little or no cooperation – ‘we did that investigation ourself’ and commented that the DOJ don’t build a criminal case it can rely on in court relying on company turning over interviews and emails.

Every case we investigate we investigate with an eye to charging individuals, he continued and while there have not been many trials of individuals that is mostly because the majority of defendants have chosen to plead guilty, he said.

Speaking about Self Disclosure he was clear that it was ‘not my job to advise companies about whther they should disclose’.

However, he was clear that from DOJ’s perspective it was committed to rewarding companies who do Self Report and distinguishing those who do self report from those who do not.  Countering criticism from some commentators that it is hard to see any value in Self Reporting on the basis that there is no discernible difference in the outcome he cited Marubeni again.  In the DOJ press release dealing with Marubeni the DOJ said:

‘The plea agreement cites Marubeni’s decision not to cooperate with the department’s investigation when given the opportunity to do so, its lack of an effective compliance and ethics program at the time of the offense, its failure to properly remediate and the lack of its voluntary disclosure of the conduct as some of the factors considered by the department in reaching an appropriate resolution.’

Acting Assistant Attorney General Mythili Raman announced, ‘The company refused to play by the rules, then refused to cooperate with the government’s investigation. Now Marubeni faces the consequences for its crooked business practices in Indonesia.’

On top Mr. Knox said that what the public at large don’t see are the dozens and dozens of declinations that are not publicised (for obvious reasons).

In conclusion he said I don’t know what the odds are of getting caught, but they are higher today than they have ever been before.

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