Editor's note.

• Author: Glandon, Kevin R.

Welcome to the Twenty-Fifth Edition of the Annual Survey of White Collar Crime. Our goal every year is to provide readers with current and relevant information regarding federal white collar criminal offenses. To that end, this issue includes an introductory essay and a policy proposal. The essay examines the trend toward increasing enforcement of and penalties for Foreign Corrupt Practices Act ("FCPA") violations and the need for the adoption of an FCPA leniency policy to correct an incentive structure that currently discourages corporate internal investigations and self-reporting. The policy proposal urges that federal officials cease ignoring kickback arrangements in the healthcare sector aimed at private pay patients, which are impacting the integrity and cost of the nation's healthcare systems and can and should be prosecuted as federal crimes.

Robert W. Tarun and Peter P. Tomczak have authored the introductory essay, entitled A Proposal for a United States Department of Justice Foreign Corrupt Practices Act Leniency Policy. As prosecutions for FCPA violations dramatically increase along with sanctions and penalties, the essay sounds a cautionary note that often severe and unpredictable enforcement measures may be counterproductive and actually discourage corporations from internal monitoring and investigating, and reporting detected crimes. When corporations discover misconduct that is neither systemic nor likely to be independently detected by law enforcement, the current enforcement scheme may not sufficiently incentivize self-reporting. To fully realize the societal benefit of self-reporting of FCPA violations, the essay articulates a need for the Fraud Section of the Department of Justice to develop a transparent leniency policy modeled after the Antitrust Division's Corporate Leniency Program. To make their case, the essay's authors first examine the extent of sanctions imposed on corporations for violations of the FCPA. Next, the authors assess the successful antitrust leniency policy and its relation to the Sherman Act.

The authors then review the legal and practical incentives facing corporations and their boards when they consider whether to self-report FCPA violations. Finally, the authors detail the functioning of a carefully constructed FCPA leniency policy that would incentivize corporations to engage in thorough internal investigation and self-reporting. Mr. Tarun is a partner at Baker & McKenzie LLP, in San Francisco...