The recently announced BNP sanctions settlement is remarkable in so many ways: the behavior is outrageous, the $9 billion criminal penalty is record-setting, and 13 employees were terminated. However, the most interesting part of the story may be the idea that the DOJ is exploring ways to use the forfeited funds to compensate individuals who may have been harmed by the sanctioned regimes of Sudan, Iran and Cuba.
The DOJ press release announced that they’re inviting crime victims “to provide information describing the nature and value of the harm they suffered.”
And notice the broader trend here. Just a year ago, the DOJ reached a record $16 billion civil settlement with Bank of America for conduct relating to the financial crisis. But a remarkable $7 billion of that settlement was set aside to provide “relief to struggling homeowners, borrowers and communities affected by the bank’s conduct.”
There’s yet another dot to connect here: the criminal settlement with BP relating to the Gulf of Mexico oil spill: $4 billion, of which $1.6 billion was set aside for projects aimed to help the communities impacted by the spill.
Big settlements, major portions of which were set aside to help victims. Could the FCPA be next?
As a recently published series of posts on the BOTA Foundation explained, we’ve done it before. That series, authored by Aaron Bornstein (with a concluding post by Andy Spalding) was cautiously optimistic that the DOJ would be open to setting up future foundations as a way of directly assisting victims of corruption: the poor.
The BNP case, like BofA and BP before it, shows that the DOJ is already more than open to using penalty settlements to assist victims. For this, we believe the DOJ actions should be vigorously supported. We will be following how the restitution process actually works with great interest.
Aaron Bornstein was the Executive Director of BOTA Foundation, employed by a Washington, D.C. based NGO called IREX, from 2011 until its close in 2014. He can be contacted here.
Andy Spalding is a Senior Editor of the FCPA Blog and Assistant Professor at the University of Richmond School of Law.