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How to Pay a Bribe: Thinking Like a Criminal to Thwart Bribery Schemes

August 2014
Compendium Roundup


This month, companies undergoing formal investigation spanned several stages of U.S. Foreign Corrupt Practices Act ("FCPA") enforcement, providing some interesting anti-bribery lessons.  Cubist Pharmaceuticals, Inc. disclosed that the U.S. Securities and Exchange Commission ("SEC") and U.S. Department of Justice ("DOJ") began investigating Cubist in relation to a global biopharmaceutical company, Optimer Pharmaceuticals, that it acquired late last year for USD $551 million.  The SEC and DOJ investigation is in connection to an attempted share grant by Optimer Pharmaceuticals in 2011 and a potentially improper payment to a research laboratory involving an individual associated with the share grant. 


Cobalt International Energy, Inc. disclosed that it had received a Wells Notice, stating that the SEC made a preliminary determination to initiate an FCPA enforcement action against the company for improper payments allegedly made in Angola.  The allegations involve the hiring of two local contractors by Cobalt to fulfill a public contract, allegedly at the request of Angolan government officials.  Several senior Angolan government officials owned shares in the two local companies.


Layne Christensen Company received a declination after four years of investigation by the DOJ.  The company discovered potential violations of the FCPA related to the legality of certain payments to customs clearing agents in connection with importing equipment into the Democratic Republic of Congo, and other countries in Africa, while updating its anti-bribery policy in 2010.  Layne Christensen made a voluntary disclosure to the U.S. authorities, and the SEC investigation is ongoing.  Following the DOJ declination, Layne Christensen reduced its reserve for a potential FCPA settlement from USD $10.4 million to USD $5.3 million.


There have also been developments for News Corp., Volkswagen AG, Qualcomm Inc., SBM Offshore, Haiti Teleco and Siemens.

On the Blog

This month, the TRACE Blog dove into the world of Anti-Bribery Certifications.  First, we de-mystified some common assumptions that surround certifications and then we made a research call for any case studies on the process and impact of our own TRACEcertification.  We also took a look at collective action approaches to anti-corruption, especially the role that academia plays in moving this important field ahead.  If you would like to submit your ideas to the TRACE Blog, please contact Severin Wirz at


China announces Investigation into Volkswagen AG's China Joint Venture -  China's anti-corruption authority - the Central Commission for Discipline Inspection - has reportedly opened an investigation into two top executives at the joint venture between the German automaker and state-owned FAW Group Corp.  Audi, Volkswagen's luxury unit, is also involved in a probe by Chinese anti-monopoly regulators regarding inflated vehicle and spare part prices.


Tanzania Takes Positive Steps Towards Curbing Corruption -  The country's Prevention and Combating of Corruption Bureau (PCCB) recently announced that law enforcement have filed 327 cases over the past year and recovered about TZS 40 billion (roughly USD $24 million) during that time period as well.   The government also recently announced that it was setting up a special unit to monitor oil and gas revenues, including training auditors on how to manage and oversee lucrative contracts with foreign multinationals. 


U.S. Tennis Association Comes Under Scrutiny - A New York Times article has created a stir for the U.S. Tennis Association, pointing out possible conflicts of interest between several of the group's current and recent board members and recent U.S.T.A. grants and contracts.  The paper alleges that at least $3.1 million worth of U.S.T.A. contracts have gone to organizations with ties to board members.


Cobalt International Receives Warning Shot From SEC -  The US oil company announced that it had received a Wells Notice from the SEC this month, which warned that the company faced an enforcement action for breaches of certain federal securities laws.  The notice is thought to be linked to alleged breaches of the Foreign Corrupt Practices Act (FCPA) pertaining to certain offshore oil deals in Angola. Following news of the notice, Cobalt shares fell by more than 10% and several shareholder plaintiffs firms announced that they too were investigating whether to bring actions against the company.


Vote now on the TRACEblog

Benchmarking: Commission Rates

The 2014 TRACE Commission Benchmarking Project provides data on the average commission rates paid to third parties on a country-specific basis for business-to-government deals based on four deal sizes. Each segment covers four or five countries within a region. The results for the South America segment are now available. Companies that participated should have received a copy of the results. If you participated but did not receive a copy, please email


You may now access the survey for the Middle East segment, which includes Saudi Arabia, Israel, United Arab Emirates, Oman and Egypt, here. Survey responses are submitted anonymously, so please register your company's participation via email to to receive a copy of the results. 


Please submit only one response per company by Monday, September 1st, 2014. 

Articles Written by TRACE

Test your knowledge of the murky world of bribery and the flourishing field of compliance with our new weekly quiz. Authored by TRACE President, 
Alexandra Wrage, the Wednesday InterWRAGEtory features a new multiple choice question related to anti-bribery and corruption every week. In addition to providing an entertaining way to test your knowledge of anti-bribery facts, the quiz can be used to enhance any training program. 
Sign up for our mailing list to receive weekly reminders when the next question is posted. You can also use our Contact Us page to suggest new topics and questions for inclusion in the quiz. 
August Quiz Questions:
August 6, 2014
According to the most recent estimates, WalMart is spending more than __________ per business day on its FCPA investigation and related remediation.
Click here to answer. 

August 13, 2014
What is the longest jail sentence awarded in the US to an individual for international bribery?
Click here to answer. 

August 20, 2014
Anti-bribery compliance and enforcement in China raise which of the following issues?
Click here to answer. 

August 27, 2014
What percentage of the global population paid a bribe in the last year? 
Click here to answer. 
Featured Resource: TRACE's New Website
We are very excited to announce the redesign of our website,!  Over the past few months, we have been working very hard on a complete overhaul to make our site easier to navigate, more user-friendly and mobile-compatible. Click here to learn more about these upcoming changes. 
TRACE Anti-Bribery Specialist Accreditation (TASA) 

TASA (TRACE Anti-Bribery Specialist Accreditation) offers the most comprehensive, high-quality and easily accessible anti-bribery education on the market. TASA boasts over 100 online courses taught by a world-renowned faculty of anti-bribery experts. Candidates have access to an extensive library of recorded webinars as well as live webinars, scheduled regularly throughout the year. 

The new TASA website is scheduled to be launched mid-September! It is designed to be more user-friendly, intuitive and compatible with mobile devices. More details about the site will be announced as we approach the launch date. 

India Summit on Anti-Corruption 
September 22-23, 2014 * New Delhi, India
FCPA Boot Camp West
September 29-30, 2014 * San Francisco, CA

October 15-16, 2014 * Miami, FL


Upcoming live TASA accredited TRACE events:

September 29, 2014 * New York

October 30, 2014 * Istanbul

November 5, 2014 * New Delhi

January 20, 2015 * Sydney

January 22, 2015 * Melbourne

To inquire about discounts and credits, write to  

TRACE Roundtables offer senior-level compliance professionals an opportunity to participate in an advanced discussion on the latest anti-bribery enforcement trends and compliance best practices. Roundtables are led by a TRACE representative and feature special guest speakers. Upcoming roundtables are listed below.  


New York, September 29, 2014
Click here to view the agenda. 

Melbourne, January 22, 2015
The program is still under development. 
To request an invitation or suggest locations for  upcoming events, please write to

TRACE hosts practical, informative anti-bribery training workshops at locations throughout the world. The workshops feature local and foreign business people and lawyers familiar with the challenges of international commercial transactions. Workshops are attended by members of the business community for whom such training is either unavailable locally or prohibitively expensive. Employees and intermediaries of TRACE member companies attend at no charge. 

Istanbul, October 30, 2014

Click here to view the agenda.


New Delhi, November 5, 2014

The program is still under development.


Sydney, January 20, 2015

The program is still under development. 

To request an invitation or suggest locations for  upcoming events, please write to
Save the Date: 11th Annual TRACE Forum
 The 11th Annual TRACE Forum will be held March 25-26, 2015 at the St. Regis in Washington, DC. TRACE members should plan now to attend what has become the premier anti-bribery benchmarking conference. Registration for the 11th Annual TRACE Forum will open to TRACE Corporate Members on September 1, 2014. 
The Forum program is currently under development. Please visit our Forum webpage for program updates and registration details. For questions, please write to



Washington, DC
September 10-11, 2014
Hosted by: American Leaders
*Eileen Radford, Director, Advisory Services, speaking

Chicago, IL
September 14-17, 2014
Hosted by: SCCE
TRACE International is proud to be sponsoring and exhibiting at SCCE's 2014 Compliance & Ethics Institute. 
*TRACE Representative attending

New Delhi, India
September 22-23, 2014
*TRACE Representative attending

Houston, TX
September 22-23, 2014
Hosted by: Momentum
*Alexandra Wrage, TRACE President, speaking

FCPA Boot Camp West
San Francisco, CA
September 23-24, 2014
Hosted by: American Conference Institute
*TRACE Representative attending


Atlanta, GA
October 1-3, 2014
TRACE International is excited to be sponsoring and exhibiting at the ECOA's 22nd Annual E&C Conference. 
*Alexandra Wrage, TRACE President, speaking

London, UK
October 7-8, 2014
Hosted by: WBR
*Alexandra Wrage, TRACE President, speaking

London, UK
October 13-15, 2014
Hosted by: IQPC
*Severin Wirz, Manager, Advisory Services, speaking

October 14-15, 2014
Hosted by: C5

October 15-16, 2014
Hosted by: BSR
*Alexandra Wrage, TRACE President, speaking

Miami, FL
October 15-16, 2014

October 21, 2014
Hosted by: AMLP

Brussels, Belgium
October 21-22, 2014
Hosted by: CBI
*Eileen Radford, Director, Advisory Services, speaking


For a complete list of upcoming events, visit the Anti-Corruption Event Calendar on our website. 
International Regulatory Updates

New Partner Firm

Ms. Lindsay Sykes, Partner (
Ferrere Building
Juncal 1392
Montevideo, Uruguay
Tel: (598) 2900 1000
Fax: (598) 2900 5000
News & Press



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