International Criminal Law Enforcement: Rule of Law, Anti-Corruption, and Beyond

Tuesday, May 4, 2010

Assistant Attorney General Lanny A. Breuer discusses international law enforcement of corruption and bribery.

MARK BRZEZINSKI: Good morning. Good morning, everyone, and welcome to the Council on Foreign Relations and today's corporate program meeting on International Criminal Law Enforcement: Rule of Law, Anti-corruption, and Beyond.

Our format this morning will be as follows. Our speaker will make opening remarks for about 15 minutes. Then he and I will engage in a conversation for 15 minutes. And then we will turn to the audience for questions and answers. The meeting will conclude promptly at 9 a.m. Mr. Breuer has to return to Washington, where he is giving testimony on Capitol Hill.

Today's meeting is on the record. Please remember to turn off your cell phones and Blackberrys.

Our speaker this morning is Lanny Breuer, who has just completed his first year as assistant attorney general in charge of the Criminal Division at the Department of Justice. Mr. Breuer has a distinguished public service and private sector background, and he brings that to the Department of Justice.

He began his career here in New York as an assistant district attorney in Manhattan, where he prosecuted cases ranging from murder to child abuse, gang violence to white-collar crime. In 1997 he was appointed special counsel to President Clinton in the impeachment trial. Between 1999 and 2009, Mr. Breuer was a partner at the eminent Washington law firm of Covington & Burling, where he also served as vice chair of the firm's pro bono committee.

In April 2009, Mr. Breuer became the Criminal Division chief. In that capacity, he works closely with the 93 U.S. attorneys, the attorney general, Congress and the president, overseeing criminal matters in the U.S. and beyond. And it's what Mr. Breuer and his team are doing in pursuit of corruption abroad that we're most interested in today.

Indeed, in the history of the Foreign Corrupt Practices Act, there has never been as dynamic a moment. Currently the Justice Department has over 150 open investigations centering on foreign bribes. By comparison, 10 years ago at any one time the Justice Department had eight investigations ongoing. Mr. Breuer has set up a new FCPA task force and has requested additional funding for the fiscal 2011 budget to beef up its workforce.

Given the linkage between corruption and other national security challenges, the Obama administration has underscored the importance of enforcement of the Foreign Corrupt Practices Act. How do these new enforcement efforts fit into the Obama administration's global approach to promote the rule of law? And what are the implications for the business community?

Ladies and gentlemen, I introduce to you Criminal Division Chief Lanny Breuer. (Applause.)

LANNY A. BREUER: Good morning, everyone. And thank you, Mark, for those really warm and gracious comments. I'm really delighted to be invited to speak with all of you. Thank you for waking up early to see me. And I'm obviously very honored to be at the Council on Foreign Relations, such a remarkable group.

It really is for me an honor to speak here today. And of course, as all of you know, since its founding, the council has contributed enormously to the debate on foreign policy from a reasoned and diverse point of view. And so as the head of the Criminal Division, it's particularly terrific for me to have an opportunity to tell you a little bit about the Criminal Division and what we're doing.

So I am so pleased to share with you today how we in the Criminal Division seek to promote the rule of law in what I believe and we all know is our increasingly global society.

First let me begin by discussing for a moment what do we mean when we talk about rule of law. This is, of course, a phrase that seems to be on everyone's lips and is discussed often, but is it more than just a catch phrase? Does rule of law have any real meaning any longer?

Or another question: What if, instead of rule of law having no meaning, it is really a code for something else? Is it just nation building, itself criticized by many, by simply another name? Does it necessarily carry with it values of a particular political system rather than universal principles?

When we speak of rule of law, are we opening ourselves up to charges that we are engaged in a form of disguised cultural imperialism? Or worse, rather than protecting individual rights, does rule of law mean simply a system deigned to protect societal power relations?

These are obviously interesting intellectual questions, but I would submit that at least for me as the head of the Criminal Division, we in the Criminal Division offer some answers to these questions.

Within my first weeks at the department, I met a man named Karl Clark. Karl, who was a high-ranking police officer in the United States, now works in Pakistan for the Criminal Division's International Criminal Investigative Training Assistance Program, known as ICITAP. Karl has left behind his family and put himself at personal risk to work around the world to establish not simply police investigative practices but what police practices best protect, both citizens and the rights of citizens.

Karl is just the first of the courageous men and women of the Criminal Division who I've met and who have committed their lives to helping to build the rule of law internationally through ICITAP and its companion office, OPDAT, the Office of Overseas Prosecutorial Development Assistance and Training.

And literally every single lawyer and every single law enforcement officer around the country who the Criminal Division sends, I meet with every one of them when they return. And one of the remarkable moments for me is, if I were to generalize -- whether they're young or old, whether they have families or they're single, whether they're from the East Coast or the West Coast, whether they're in the most dangerous parts of the world or not -- when I ask them whether they like what they do, almost to a person they have loved it. And when I ask them why, almost to a person, it's one area or another, they say something to the effect of, "I really felt and I really feel that I can make a difference." And that, to me, means so much.

OPDAT and ICITAP have stationed Department of Justice resident legal advisors and senior law enforcement advisors in 37 countries around the world, from Colombia to the Balkans, to Iraq and Afghanistan, to Kenya and to Indonesia. Their job is to provide advice and guidance on how to establish and sustain fair and transparent justice systems, police services and prison facilities.

There probably is no group of individuals, in my view, more focused on the real meaning of rule of law than these individuals and their colleagues in the Criminal Division in Washington, D.C. In fact, the Criminal Division's work in this regard can be seen as having, in my view, three prongs, all of which are necessary for rule of law and to give rule of law real meaning, to make it substantive as well as formal in content, but substantive in a uniformly, universally agreed-up manner, rather than simply a reflection of United States and our legal system.

So what are those three prongs? First, over the past 20 years, in partnership with the State Department and our foreign counterparts, the Department of Justice's Office of International Affairs has helped create, through multilateral instruments, a consensus view of what steps must be taken to ensure that their justice systems can achieve rule of law in areas ranging from corruption, to transnational crime, to trafficking in humans, to terrorism.

Second, the Criminal Division's prosecutorial arms have sought to give meaning to those conventions by prosecuting, as Mark has just talked about, those who violate agreed-upon rule-of-law norms.

And finally, third, it is through those universally agreed-upon principles that our overseas legal advisors work, in partnership with our foreign counterparts, to put in place the laws and practices of their host countries.

Perhaps no area has shown the Criminal Division's three-pronged approach more than the dramatic results that we have pursued in international rule of law in the area of corruption.

So I think it is worth examining for a bit how that area exemplifies what we are building with respect to international consensus, and then how we seek to enforce that consensus through our own criminal justice system and how we help to ensure that other nations will do exactly the same and have the legal capacity to do the same.

While it is now widely accepted that corruption is not simply a matter or fact of life and that it should be accepted, of course, this was not the case long ago. When the U.S. enacted the Foreign Corrupt Practices Act in 1977, and as recently as in the 1990s, some developed countries continued to argue that a certain amount of corruption might be desirable in developing nations. Yet it's only been in the last decade that some developed countries have eliminated tax deductions for foreign corrupt payments.

The change in attitude can be linked, in my view, to a number of intervening factors, including the emergence of civil society's voice against corruption lead by organizations such as Transparency International and others like it, the fall of the Soviet Union exposing institutionalized corruption, news media attention, and finally, the development of models of how corruption could successfully be fought, the most powerful of which was the Hong Kong experience, including the creation of the Independent Commission Against Corruption.

All of these factors are critical, but I believe credit also must be given to a particular group of individuals: the career criminal-division lawyers and State Department and Treasury officials who pushed forward the idea of universally condemning and criminalizing corruption in international fora such as the OECD, the OAS, the Council of Europe, and finally, the U.N. itself.

The result has been an ever-accelerating and expanding set of international conventions. The progression is really quite something, beginning with the 1994 OECD recommendation to criminalize bribery of foreign public officials to the 1996 OAS Convention, the first multilateral convention against corruption, to the 1998 OECD Anti-Bribery Convention, the 1999 Council of Europe Convention, and most recently, the U.N. Convention Against Corruption, the first global anti-corruption convention ever.

The importance of this development to the -- to the international rule of law cannot be overstated. It is nothing less than the creation of a global consensus that corruption is unacceptable, that it harms the least well-off of us the most and that official impunity cannot stand.

International consensus of fighting corruption is critical, but it is not sufficient. The second prong of the Criminal Division's approach is to give that consensus meaning through our prosecutions, particularly under the Foreign Corrupt Practices Act.

Since the passage of this historic law, the Criminal Division has had primary responsibility for its implementation. Simply put, Criminal Division enforcement of the FCPA was intended to, and has had, an enormous impact on the way business is done. Since 2005, the fraud section has achieved 36 FCPA- and foreign-bribery-related resolutions, with fines totaling more than $1.5 billion. Since that time, the Criminal Division has charged 77 individuals with FCPA violations and related offenses. Forty-six of these indictments have been brought since the beginning of 2009.

So more than the total number of indictments brought in the previous seven years combined have we brought simply in the last year. Those charged have included CEOs, CFOs and other senior corporate, sales, marketing and finance executives, intermediaries, and where jurisdiction existed here in the United States, several foreign officials. This increased emphasis on charging individuals is part of a deliberate enforcement strategy to deter and prevent corrupt practices in the future.

Beyond charging individuals, it is no secret that the Criminal Division is dramatically changing the way we investigate these allegations. Gone are the days when we relied solely on tips from whistleblowers to build cases. Instead, we are now bringing the tools of organized crime investigations to white-collar investigations. We are setting up sting operations, such as we did in a recent investigation in which defendants from the United States, the United Kingdom and Israel allegedly tried to bribe the minister of defense of a foreign country to provide arms to outfit the country's presidential guard.

The Criminal Division's efforts have brought heightened corporate-, board- and executive-level attention to anti-corruption issues. Indeed, many firms have implemented detailed compliance programs intended to prevent and detect any improper payments by employees and agents. And I, of course, applaud those efforts.

Ultimately, I believe the division's careful prosecution and litigation choices and aggressive strategies have helped to curtail the widespread practice of foreign bribery. And we will continue to act accordingly.

But this is not the only area in which the Criminal Division is doing critical anti-corruption work. The prosecutions brought by the Public Integrity Section send an important message not only domestically but internationally. They indicate that the United States takes seriously the key proposition that no public official is above the law, be it an elected politician, a political appointee or a judge.

In addition, the Criminal Division's Asset Forfeiture and Money Laundering Section is committed to working with other countries to ensure that their corrupt officials do not retain the illicit proceeds of their corruption. And this will remain an ever-greater focus of our division in that section's work.

Working in close cooperation with our law-enforcement partners in other countries, the United States was able to repatriate more than $20 million to the nation of Peru that was looted during the government of Alberto Fujimore and Vladimiro Montesinos. We likewise have forfeited and repatriated more than $100 million in proceeds of corruption in the judiciary in Italy, and have repatriated several million dollars to the government of Nicaragua, traceable to the illicit conduct of the administration of Arnoldo Aleman. We will continue to work in this area, and we will work hard to ensure that those who have become rich through corruption are forced to give up their funds.

But we will continue to do more. At last year's Global Forum Against Corruption, in Doha, Attorney General Holder announced a redoubled commitment, on behalf of the Department of Justice, to recover such funds. And so you will see more developments in the near future.

The final prong of our strategy has been to help other nations to build their own capacities to fight corruption within the framework of the U.N. Convention Against Corruption and the other multilateral, anti-corruption conventions. This work has been carried forward by the federal prosecutors assigned overseas by OPDAT and the senior law-enforcement advisers of ICITAP.

It is also a central part of the work of the department's overseas attaches, from the FBI, DEA, U.S. Marshals Service and the ATF. This work proceeds at all levels, through the creation of vetted police units, the members of which are investigated to ensure that they are free from corruption. And just next week I will be in Mexico dealing with that very issue.

The establishment of internal controls and police services and prisons, such as inspector-generals officers. And recently I was in the Ukraine, where we talked about the role of IGs and the importance of IGs in helping to have robust institutions and government entities that are free of or have far less corruption.

Advice on enactment of legislation that will bring the country into compliance with the U.N. Convention against Corruption, and the development and monitoring of specialized anti-corruption prosecutorial units.

What we have learned from our rule of law experience in countries like Colombia and Indonesia is that we must create long-term sustainable partnerships.

And we must be sure, we must be sure, that we convey the message that we are in these countries as partners, not as teachers who have all the answers or who have solved all of our similar problems which of course we are not.

Whether they be problems of corruption, organized crime or narcotics, we must remain candid that we remain and still have these issues in the United States as well.

I began by asking whether there is any meaning to the phrase rule of law. My experience over the past year has convinced me, not only that there is content to that phrase but that nothing is more critical, both to our country and to other nations, than establishing true rule of law.

I could not be more proud of the work that the men and women of the Criminal Division pursue: work on multilateral conventions, in prosecuting anti-corruption cases and in capacity-building abroad.

I'm very grateful to be in such an august group and at such a forum as this. And I'm very proud for all of you to get an appreciation of what prosecutors in the Criminal Division can do, to put forth our foreign policy and to try to fight against corruption around the world.

I really in my heart do believe that by doing this, we build on our relationships abroad, we strengthen America's rapport, reputation and friendship, with our allies and others around the world. And it permits the Criminal Division to play robust and very real efforts, both in the courtroom and outside.

So thank you so much for giving me this opportunity at such an early hour. And I'd welcome whatever questions you have. Thank you so much. (Applause.)

BRZEZINSKI: Thank you, Mr. Breuer. Let me start with a very general question and then go on to something more specific.

If we claim the moral right to promote the rule of law and anti-corruption and criminally pursue corruption, around the world, don't we have an obligation to have a record at home that is beyond reproach?

And if there's a lot of evidence that our own financial system has problems with legal corruption or ethical corruption, is what is happening at home undercutting our strategic objectives abroad, in terms of promoting rule of law and anti-corruption?

BREUER: So Mark, I think that the reality is that it isn't. And it goes to one of the points I was trying to make which is, I think when we deal with other countries, we have to deal with them as partners. We can't deal with them as if we have a monopoly on all that is right.

And really at the end of the day, what we have to establish is that we have robust institutions, and I think we do. So if there is in fact criminality in our financial institutions, then it's incumbent upon our regulators and our prosecutors to ferret that out and to prosecute it, and for people to have confidence that in an impartial way, we're going to do that.

If there's corruption among our politicians or appointed officials, then once again our prosecutors -- whether they be in the Public Integrity Section, the Criminal Division -- or the U.S. attorneys have to zealously pursue it. And people have to believe that we're doing it not based on politics, not based on bias but based on the facts and the law.

We're a diverse, enormous country. We're never going to -- we're never going to be crime-free and we're never going to have those who aren't bad actors. And what we have to have are institutions that make it work. And that's exactly what I think our remarkable lawyers, the prosecutors and law enforcement officials are trying to do, when they are around the world.

So I think frankly the fact that we ourselves self-examine ourselves is in fact probably the best example of what we're trying to do abroad.

BRZEZINSKI: Let me turn the tables a little bit, because this could actually happen. What if other governments pass similar laws and try to enforce it against us?

Suppose Chinese prosecutors went after a U.S. company operating in China that had paid bribes in Russia. How would we react or view this, as a positive or as a troubling development?

BREUER: Well, my view is that if we have confidence in the countries and confidence in the laws, and they're being done impartially, then absolutely. If you're an American company and you're operating in Germany or in China, and you're breaking those laws or you're bribing officials in another country, then absolutely.

You should be subject to the same investigations and prosecutions. The key has to be that it's done based on the law and based on the facts and it's impartial. But if we get to a point where in fact what I think will happen, that most countries will adopt the kinds of laws we have, such as the FCPA, then I think our companies must expect it.

They should expect it. And in fact I think it will be a very good way of reducing corruption. So I would embrace that.

BRZEZINSKI: Now, the U.K. has just passed a new bribery act. And it's still to be implemented. But it's unprecedented in that it expands beyond the FCPA, including criminalizing failure to prevent bribery and creating no exception for facilitation payments, which is one of those gray areas at least in the eyes of some in business, or bona fide expenditures for promotional activities.

How will that benefit our global efforts? And what would you forecast in terms of the future of U.S.-U.K. collaborations?

BREUER: Well, going to the latter first, there's no question that U.S.-U.K. collaboration will only increase, as will our collaboration throughout Europe and others.

Just this year, our renewed treaties demonstrate now with the EU that we have really essentially one treaty for extraditions and one for MLATs. And as a result, it's far less formalistic, far more nimble. I think there will be far more joint investigations. And we'll be able to share information, whether banking information or the like, more.

I think what the U.K. law demonstrates is exactly what I believe is happening which is, countries around the world are understanding that what they originally understood to be acts of corruption that were permissible, or that they weren't going to pursue, that they are.

Of course, the British just put for the first time -- incarcerated someone for about a year based on bribery. And I think you're going to just see more of that. And again I think that that's a welcome development.

BRZEZINSKI: Mr. Breuer, let me ask you about targeted industries. In the past, FCPA enforcement efforts have focused on specific industries, on the oil and gas industry for example, when we were pursuing anti-corruption particularly as it related to the Oil-for-Food Program.

Today, there is a stated focus on the pharmaceutical industry. In choosing to target certain industries, what drives those decisions? Do they come from within the DOJ? Are they set through interagency coordination with the White House on U.S. national security objectives or economic objectives?

BREUER: Absolutely not. It doesn't come from the White House or anywhere near it. And indeed I wouldn't really say we focus on industries. What I would say is, it's sort of -- it's a slightly different process. We look to see what the facts of an industry are. And we look at past investigations.

So we'll have investigations. We'll uncover problems in a particular case. And then we'll ask ourselves as prosecutors whether the issues that we've identified in a particular case in our view are company-specific, or whether whatever the phenomenon are we think may well be the same throughout the industry.

So we think there are a set of factors that made one company perhaps engage in corruption. And we think that those same pressures might be on its competitors. Then we're going to look at it. But it's very much a fact-based inquiry and not at all, we're going to go after the X industry or the Y industry. And there are going to be certain issues.

I've said for instance in the pharmaceutical area, where there are so many government-run programs abroad, where there are single formularies -- where if you get on the formulary, you can do business, and if you're not on the formulary, you cannot -- and where many of the companies really have very similar products, and so competition is very difficult, that those are factors that would make it likely that we would look at that industry. But there are many industries like that, and we just continue to see where the factors are, and we go forward.

BRZEZINSKI: You mentioned OPDAT and ICITAP, programs implemented by the Department of Justice, I believe, and funded by State. Two agencies.

BREUER: Right.

BRZEZINSKI: How do you work together to set priorities?

BREUER: Well, I try to make sure that the State Department loves us a lot, since they hold the fees.


BREUER: I mean, it's an issue, right? I mean, the State Department's terrific. They're our partners. They fund it. We have the lawyers and the law-enforcement people. It's a very dynamic, iterative process. I meet with the assistant secretary in charge of INL, I meet with other people at the State Department. Many of the people in the Criminal Division are, on a daily basis, talking with folks at the State Department. And we set our priorities based on many factors.

The way I try to do it, candidly, is based on the people on the ground. So when folks come back to me from Pakistan or come back to me from Afghanistan or wherever they are, I try to get a very real sense of what they think is working, what they think isn't working. If it isn't working, why isn't it? And it's not particularly theoretical. It's very much, "This is a program that's working. Meeting with the judges right now in Iraq is working, Lanny, and here's why it's working. And they're switching to an adversarial system as opposed to what they had before."

Well, if we're doing that, it's not so natural to understand what an adversarial system is. It's not so easy to understand how you're going to bring a case in court. But yet it's so vital that that institution is vibrant and work if the country's going to work forward. So then that, I would -- we would argue that that should be a priority, and we would talk to our friends from the State Department, or others. There are other funding mechanisms as well besides the State Department, other sources as well. But that's really how we move forward.

BRZEZINSKI: A couple weeks ago, General Jones rolled out the new national-security strategy, and development is one of the three Ds, or three core pieces of it. And rule-of-law promotion is a key piece of development. Mr. Breuer, what's the best combination of carrots and sticks in terms of promoting a culture of legal certainty and rule of law abroad? Because it's something that we have spent millions of dollars on trying to learn how to do. But I get the sense that we're still trying to figure out the right catalyst between carrots and sticks regarding what works. And of course, promoting a culture of anti-corruption and rule of law in Mexico is different than promoting the same in Afghanistan or in Africa.

BREUER: Well, I wouldn't purport to speak for General Jones on a wider level. I think within the Criminal Division and within the areas that I'm responsible for, the carrot-and-stick approach is pretty clear. The carrots for me are the many, many people around the world who are right now working with countries to do the very things I spoke about in my speech.

And it is really remarkable -- and I hope you all know -- it is remarkable the number of prosecutors around the country, the number of prison guards and law-enforcement people and sergeants, et cetera, who are willing to leave their families to go abroad and to train their counterparts, and to live abroad and to be a part of programs. I think that, of course, is the carrot.

The other carrot is to encourage corporations to have compliance programs. And if they have real compliance programs that work, and then they -- something runs afoul, that they get credit for it.

The stick is that we'll have robust prosecutions. The prosecutions will be not just of companies but of individuals. Obviously, in the last year, we've indicted more individuals than in the -- than ever before. I'm going to hold executives responsible. If you're an executive and you haven't done what you should do and you've been involved in bribery abroad, we're going to seek, where appropriate, jail time. And i think that there's no greater stick than that.

So our carrots will become, I hope, you know, even more vitamin-filled, and you will want to eat them more and more. And our sticks will be, frankly, more and more worrisome, so that you'll think very hard before you engage in misconduct. And that's how I look at it. And then probably I hope others take it to a different level, like General Jones.

BRZEZINSKI: Before I turn to the audience for questions, we can't have a conversation on anti-corruption without giving a shout-out for NGOs like Transparency International, who have been in this for decades and who have been so instrumental in developing and sharing information on international corruption. Indeed, Transparency International's corruption perceptions index is one of the kind of standard rankings that companies now turn to to see what a country's reputation for corruption is.

How can DOJ and NGOs like TI collaborate to go after the culture of corruption in some places overseas? And what other useful roles might NGOs have to advance our goals in this area?

BREUER: Well, look. The role of NGOs is critical, right? I mean, obviously, if you are -- if you're expert in this area, if you're devoted to this area, if you've been working at it and you care about it deeply, we want to hear about it, we want to work with you. We get many of our great ideas, frankly, from the NGOs, who identify problems around the world or players who we should deal with. And so it becomes a very dynamic, rich environment.

Frankly, NGOs can also be helpful not just in helping us establish the structures or helping us figure out where we should be or often recommending people who we at the Department of Justice can hire or bring on board to be a part of our process, but, frankly, they can also just identify areas of corruption. And they can identify players who are involved in corruption.

And not to make this sound silly, but what -- in whatever areas we are prosecuting now, I am very interested in encouraging people to come forward, whether it's whistleblowers in companies, whether it's people who are aware of a phenomenon. And so NGOs who have the expertise, who are on the ground, are able all the time. And our people are all the time working with the NGOs, both abroad and here.

And so I welcome it. I've met with representatives of NGOs. I've met with representatives of the private sector. We don't have the -- all the answers by any means, but we can learn. And so there's no question that Transparency International and others have been enormously important in creating what I'd like to think now is a robust international regime in trying to rout (sic) out corruption.

So it's a dynamic approach, and I think it will continue.

BRZEZINSKI: Let's now turn to the audience for questions. And I'll ask you to please wait for the microphone, and when you're called upon please stand and state your name and affiliation, and please limit yourself to one question.

Mr. Arkin (sp).

QUESTIONER: Mr. Breuer, we can say that America has indicted and jailed more people per capita than any country in the world. My question to you: Is corruption the same worldwide, culturally? Has corruption always involved the payment of money and perhaps possibly involved use of political influence? And if so, do we -- do we prosecute that here?

BREUER: This -- so corruption takes different forms in different environments. And all we can do in the United States is look at the corruption we have here, where we think we have it, to pursue it. And we do that.

I have a public integrity section that's devoted to nothing but pursuing public officials and others who have broken the public trust by breaking the criminal laws. It's a dynamic process. And if you read the newspapers you can see we have investigations going on throughout. And we have U.S. attorneys throughout the country doing the same.

Obviously, we're a country of laws, and we have to make sure that our citizenry and all who live here abide by them. And then we have to be a partner with other countries around the world. Obviously, there are different power structures around the world, and all of it -- you know, there are different levels of corruption. And what some people consider corruption may not be even a violation of the criminal laws. I have to define my world by what are the criminal laws in a country and whether -- and whether those are breached and broken.

In different countries, we're facing different profound problems. I'm going to Mexico next week. I'll meet with the attorney general and others. Obviously, the battle right now in Mexico by President Calderon is, in my view, an incredibly courageous one. And they're facing extraordinary pressures and extraordinary pressures of corruption. I think they're prosecuting them, and we have to be a partner of theirs. And as Mark said earlier, that doesn't mean that their corruption is the same corruption as we'll find, let's say, in the former Soviet Union.

So I don't pretend to understand exactly all the different dimensions of it or exactly how we approach it, but what I do believe that we can do, and have to do, and I think are doing, is to encourage all of these countries to have some basic, fundamental institutions and a basic understanding that all of us in our countries are going to pursue and go after those who break the laws. I'm not so naive to think that's going to happen everywhere, but I think this is an important drumbeat, and I think it's happening more and more.

BRZEZINSKI: Ambassador Gardner (sp).

QUESTIONER: First of all, Lanny, thank you for making clear that this is a foreign-policy as well as a law-enforcement issue. That was a very interesting presentation.

My question was, in fact, about Mexico. The escalation of violence, drug-related, and corruption on our southern border is an increasing concern for us. Specifically, what can we do, what are we doing, to help Mexico deal with this growing problem, which is impacting us so directly?

BREUER: Well, the Obama administration is extraordinarily committed to working with and supporting our dear friend and neighbor. And as I said a moment ago to Mr. Arkin's (sp) -- in answering Mr. Arkin's (sp) question, we think that what President Calderon is doing is really remarkably courageous, and we stand with him.

We have a very comprehensive approach, Ambassador. The Department of Justice is very involved, but other departments are very involved. We have a border strategy. We have very much of an institution-building strategy. We have -- and I will talk to the attorney general who's spoken about extraditions. We have had more extraditions from Mexico to the United States. And my goal is to continue to have extraditions, when appropriate, of some of the leaders of the cartels. And we will prosecute them zealously, and are continuing to do so.

So, we have to recognize that our -- Mexico is a very capable and able country, and support them as they want. But we have very much of an intelligence partnership, where we give them our intelligence, we give them our data. There are a lot of people thinking about these issues right now. And there's no question that the cartels pose a threat, but the Mexican government, it seems to me, is very ready and willing to take it on. And we're very willing to help them in any way that they ask us to do so.

But it won't be a problem that'll be solved overnight. It just will not be, and we have to understand that. But, you know, our southwest border United States attorneys are extraordinary. The FBI and ICE and CBP and the other law-enforcement entities have been extraordinary in dealing with this issue, and ATF, and will continue to be. And I just think it'll be an iterative process as we move forward.

But it's very much on our mind, and we're working hard at it. And I feel like we're doing a -- we're doing a fine job.


QUESTIONER: Good morning. Joel Cohen, from Gibson Dunn. I have a question that sort of has a historic background. In the mid and late 1990s, as you know, the department was working very hard through OECD to try to internationalize the effort against corruption. And many countries came along in a way that I think most of us hadn't anticipated. But the reality was, for the next decade, the U.S. still, by a far measure, led the charge in terms of prosecution of corruption.

Now, with the advent of the new bill in the U.K., what we're seeing in Germany and certain other countries, the scope of the -- of the statutes, the anticorruption statutes that these other countries can use, in theory, may be broader than what we have. They don't -- they allow -- they don't allow facilitation payments. Many of them do not require payments to or on -- to a foreign corrupt official -- a foreign public official.

BREUER: Right.

QUESTIONER: Which is what the U.N. has been pushing for. So my question is whether you anticipate or can share with us any efforts by the department to try to broaden or change the FCPA.

BREUER: So that's a great question. You know, I don't want to rule anything out, so the answer is, sure, that may happen. But you know, from my point of view right now, that's great. It's not so terrible if for a while the Germans or the British or others want to have laws that are even more expansive than our own. It's an international partnership, and we don't always have to have the identical law. And everything that we criminalize doesn't have to necessarily be criminalized abroad, or vice-versa. So I'm delighted with this phenomenon.

We will continue to look, and I'm not saying we won't at some point propose legislation or see if the Congress would do it. But the phenomenon that you're talking about I think is a good one, and I encourage it. And so, I'm happy to see how it plays out for a little while.


QUESTIONER: Mark Lynch, from Covington and Burling.

Lanny, I wanted to ask you a question about the way you focus in on particular companies and particular industries, where you think, on the basis of some other company, there may be some cause for concern. Would you be open to such companies coming in to explain to you their compliance programs -- that they have a compliance program in place, that they have uncovered irregularities from time to time and taken action on them? In other words, do a process review before requiring these companies to launch a full-scale internal investigation, sending squadrons of lawyers all around the world and incurring, as you well know, the enormous expense that that entails.

BREUER: Right. Yeah, Mark, that's a terrific question. And some of my friends in the private bar may not like my answer, but the answer is yes. I think it's a terrific idea; and in fact, something I would encourage.

They're different -- they're different phenomena. One is, let's say there is an inquiry, or you have uncovered something. I would welcome you to come in and speak to our prosecutors who deal with FCPA. And there are no guarantees, none whatsoever, but I think that those lawyers from the private bar who come in ahead of time and say, "We have an issue; we're exploring it; here's how we think we want to approach this" -- I think you're going to find a reasonable response from the Department of Justice.

We want to deal with corruption. We want your companies not to be involved in foreign bribery. But that doesn't mean you have to investigate every place around the world. We want to be reasoned and thoughtful about it. I think it's a great idea.

And similarly, I would welcome if industries want to come in and talk about even more broadly the challenges they face. We're interested in hearing that.

That doesn't give you a pass. That doesn't mean that because you tell us something, we won't down the road pursue it. But I very much want to have a give-and-take. There should be no secret about what we at the department are trying to accomplish. And I think the more we're educated by different industries and the challenges of different countries, the better. So I think that's a great question, and something that ought to be done.

BRZEZINSKI: Yes, sir. Right there.

QUESTIONER: Hi. Marcus Asner, with Arnold and Porter.

The department has had considerable success going after corporations using self-disclosure; and then also has had considerable success recently going after individuals using sort of classic narcotics or OC type prosecutions, sting prosecutions. The department's had more challenges historically going after historical cases, such as the Giffen case or the Kazaini (sp) case, where oftentimes the department gets bogged down going after individuals. I know that, you know, in the Bork (sp) matter there was a conviction. But even there, that was a rocky matter, and the sentence at the end of the day was relatively slight, compared to the sentencing guidelines.

I guess the question is -- at the end of the day, is, does the department anticipate more cases involving historical matters with individuals? And if so, how are you going to handle the resource issue?

BREUER: Right. It's a great question. So, I don't want to make a blanket statement that we're going to or not, doing it. But you're absolutely right. Certain cases pose greater problems.

My view, and I said it from my first day at the Criminal Division, was that in all areas I wanted us to be disciplined and focused in our objectives, I wanted us to be vigilant and ethical in our approach, and I wanted us to be stellar in our execution. And by that, one of the issues is, as big as the division is, we have limited resources. And so I want to understand when we bring cases, why we're bringing cases, and by bringing a particular type of case, what are we not bringing.

So it may very well be -- I'm not saying it will be the case. It may well be that we will decide in the FCPA area sometimes that we will bring more robust, newer cases, and not devote the energy for an old, historical case. We might. Or we might make the reasoned decision that, yes, we know that it will expend a lot of resources, but it's a very important message, and so we're still going to explore it.

So the only thing I can tell you is not to assume we will or won't do it, but that I'd like to think that we will give a lot of thought when we are doing it. Dennis McInerney is my fraud chief. He was a partner at Davis Polk. He was a prosecutor here in New York. He's a dear friend. And I think we very much -- he very much shares my view that with our resources we always have to be thinking hard about what we're doing.

And I'm very aware of the phenomenon you describe, and you're spot-on. And so I think you'll see a mix, frankly. I think you'll see a mix in the kind of cases we do in the FCPA area.

BRZEZINSKI: Yes, sir, on the way back.

QUESTIONER: Jonathan Chanis, New Tide Asset Management.

How would you characterize the division's relationship with Nigeria? And what problems, special problems, if any, do you have in dealing with the government there?

BREUER: Yeah, I won't talk about particularly Nigeria, frankly, or any country. I mean, look, different countries have different challenges. And frankly, I'm not so day-to-day the person dealing with the individual and the country that I'm even necessarily the best person to talk about it.

I think that whether it's Nigeria, whether it's England, whether it's Germany, whatever country it is, we have to go in being realistic and understanding who our partners and friends are. But we are still very, very committed to working with those countries, and we have a long -- we have long relationships and want them to work.

So some countries pose greater challenges, but to a degree, I think if we have credibility with those countries, they know we want to work with them, we know we'll hold them accountable if they say they're going to fight corruption and they're not. I think we -- we have a long memory.

So the answer is, I think it's a good relationship. Like all relationships, we continue -- it continues to mature, and obviously Nigeria, like other countries, is an area that we're going to be working with a lot, given the area of FCPA. I mean, really, what you're going to find, I think, is that our cases are going to really be affecting countries all around the world, even more than before.

BRZEZINSKI: Yes, ma'am.

QUESTIONER: Hi. Thank you for coming. I'm Elaina Loizou from Debevoise & Plimpton. I maybe characteristically wanted to ask about enforcement post-Siemens. I remember at the end of the case, at the time of settlement, there was the announcement that there was -- that the case did create -- sort of heighten the bar for cooperation of the -- of corporations with the department. And I'm wondering if that has played out, if you have seen that level of enforcement or if that expectation does really exist, especially with regard to expenditure of resources for the department, because I understand how that would -- level of cooperation would --

BREUER: Right.

QUESTIONER: -- affect resource expenditure.

BREUER: Well, clearly Siemens, which is of course an ongoing matter, so I don't want to -- I mean, the corporate resolution is done, but as the resolution says, that the individual -- individuals still may be -- I won't say more than -- that the agreement itself obviously doesn't affect the individuals, but at least at the corporate level, Siemens is a great example of what cooperation can do. It was a massive case, and we came about to, I think, a very fair and excellent resolution.

I think it's undeniable, undeniable, that if you're aware of a problem of corruption, you need us to think very hard about coming in. And if you do come in, it's not formulaic, but I will absolutely and our team will absolutely ensure that you will get very real and meaningful benefits from it. I was a defense lawyer for many, many years, and I dealt and grappled with these very issues. And I think I have a very keen understanding of what a benefit is, and I think have a keen understanding of the dilemma and challenge of a company or its counsel in deciding whether to come forward.

I want people coming forward. I want them coming forward in the FCPA area. I want them coming forward in the securities and commodities fraud area. I want them coming forward in all areas. I want them coming forward because if you come forward, there's a real benefit to you, and if you don't come forward and we find out about it, there's a real detriment and real pain to you. It's as simple as that.

And I think Siemens was a terrific example, and obviously your firm did a great job there. And that's a dynamic that we will only encourage that much more.

BRZEZINSKI: Let's take two questions as the last two questions. Yes, sir, and yes, sir.

QUESTIONER: Hi. Mark Hellerer from Pillsbury Winthrop. You've spoken about the DOJ's activities in the FCPA area, but the SEC also has jurisdiction in there as well.

BREUER: Right.

QUESTIONER: Can you explain how you coordinate that and where you act independently and how you divide up responsibilities?


BRZEZINSKI: So coordination with the SEC.

And yes, sir. Right there. Yup.

QUESTIONER: James Tunkey, I-OnAsia. I don't think that the Chinese right now think of us as a partner; the U.S.-listed companies who are headquartered in China, I think, are fairly ignorant of their responsibilities; and that the Chinese Foreign Ministry officials that I speak with are often surprised at the timing of your actions, and it doesn't seem to be that they consider us to be a partner. What do you see as the challenges for making them a partner?

BRZEZINSKI: Coordination with the SEC and coordination with China.

BREUER: Okay. Okay.

BRZEZINSKI: (The S's ?). (Chuckles.)

BREUER: The SEC -- I've become very close with Rob Khuzami, the head of enforcement; Lorin Reisner, the deputy head. We meet regularly. I'm very attuned to what Rob and others are doing in changing the enforcement area and making it more robust, including the FCPA area.

And I think you will continue to see that that relationship will blossom, and whether it's in the securities area, whether it's in the SEC area, we will -- we will coordinate, and we'll know what each others are doing.

We obviously have different missions. Rob's mission, Mary Schapiro's -- the chair's -- mission is to regulate the markets, right, to regulate companies. It's the regulatory area. Our mission is to look at the criminal laws and to see if they're broken -- often will be one and the same, and that's terrific, and we'll coordinate. And I think the days are over where, just because there's a civil action, whether in the FCPA or another, that there's a civil action and a parallel criminal action -- I think the days are gone where the civil action will necessarily be stayed until the criminal action is over. And I understand that, and there will be times that the civil action will go forward.

I think it's incumbent, frankly, about defense counsel and others, that if in fact the SEC comes knocking at the door, that you probably have an interest in making sure that we know about it as well, and you can do that with the SEC or you can come tell us yourself.

But -- so we are coordinating, and sometimes, frankly, we won't be interested, because maybe I won't believe it's a criminal case, whether in the FCPA or another. And sometimes the SEC won't be interested.

But I'm delighted that the SEC is more involved in this, and I'm delighted working with them. And I think you'll see that phenomenon, by the way, in all areas, whether it's the FCPA, commodities. We work very closely with the CFTC now, closer than ever before, with Steve Obie, their head of enforcement.

So you'll just see -- and I think one thing I would say in general is the Obama administration cares, and very deeply, about comprehensive approaches. And so you're seeing more generally both the federal-state-local approaches, and the FCPA area is a good example.

With respect to China, all I can say is what we're doing. I know -- I don't purport to be an expert on what Chinese officials are thinking or doing, but I do believe that our approach will remain the same. And in my world of the Criminal Division -- we have the Office of International Affairs; I have an extraordinary deputy in Bruce Swartz -- we are open, and we're letting the world know what we're doing. We're meeting all over the world, and we will remain committed, in the FCPA area, to routing out corruption. And we want very much for our friends to join with us, and we very much want to work closely with the Chinese.

And look, none of us can always be so perfectly coordinated that all the time everybody knows what everyone else is doing. But we're -- our efforts are great, and obviously the Chinese are a remarkably important player in all of this. And we very much value their friendship and value our partnership with them, however they regard it, and we'll continue to build on that.

BRZEZINSKI: Mr. Breuer, I wanted to keep my word to your able staff, Laura Sweeney and Amy Pope, who are here as well with you, and have us stop at 9 a.m., so you can get back to Washington.

Thank you for shedding light in this very important and dynamic area.

BREUER: Thank you for having me. (Applause.) Thank you, Mark.








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