Welcome to Compliance Hot Spots, our snapshot on white-collar, regulatory and compliance news and trends. In your inbox this week: the Justice Department opens up about FARA guidance, Winston & Strawn's Abbe Lowell jumps into the Carlos Ghosn escape plot case, DOJ drops a sanctions case after a jury returned a guilty verdict, and the SEC hands out its largest-ever whistleblower award. Scroll down for more Who Got the Work and notable moves.

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US Justice Department headquarters in Washington. Credit: Diego M. Radzinschi / ALM

DOJ Gives Latest Glimpse Into Scrutiny of 'Foreign Agent' Lobbying

The U.S. Justice Department for the first time has publicly posted formal advisory opinions in which it determined that law firms and lobbying shops were required to register as "foreign agents" in connection with their work for overseas clients.

Within the legal community, the move marked the latest indication of the Justice Department's push to provide additional transparency into its enforcement of the Foreign Agents Registration Act, a decades-old statute requiring the disclosure of lobbying and other political work for overseas powers. Previously, in 2018, the Justice Department published years' worth of advisory opinions shedding light on how it considered exemptions to the disclosure law, including one that allows attorneys engaging strictly in the practice of law to avoid registering.

Unlike the advisory opinions, which were redacted to conceal the recipients' identities, the Justice Department's newly posted "determination letters" identify the recipients. Among them: the firms King & Spalding and Squire Patton Boggs LLP.

When the Justice Department views a firm's activities as requiring registration as a foreign agent, a determination letter can serve as a precursor to more aggressive steps, such as a civil lawsuit to force disclosure under FARA. The letters reflect scrutiny of ongoing influence activities and often include more rigorous analysis because the Justice Department dispatches them from an adversarial posture.

Advisory opinions, on the other hand, generally come about in response to a firm's request for guidance from the Justice Department on whether a contemplated assignment would fall under FARA.

Covington & Burling partner Brian Smith, in a recent blog post, said the "lack of redactions in these letters is very useful for understanding the unit's analysis."

"In contrast, when the unit releases advisory opinions, as it began doing two years ago, it redacts identifying details," Smith said. "Although the released advisory opinions are useful, practitioners have often found that the redactions make it harder to discern the underlying legal principles that the Unit applies in the advisory opinions."

Who Got the Work

>> Winston & Strawn partner Abbe Lowell (above), co-chair of the firm's white-collar and investigations practice, recently joined the defense team representing a father and son charged in Boston federal court for their alleged role in helping Carlos Ghoson escape while on bail. Lowell and other defenders of Michael Taylor and his son Peter on Monday argued they did not commit a crime in Japan, The Wall Street Journal reports. Lawyers from the firm Jackson Lewis are on the defense team for the Taylors.

>> O'Melveny & Myers partner Michael Tubach is representing Jayson J. Penn, the CEO of chicken processor Pilgrim's Pride who was charged in a price-fixing case by the U.S. Justice Department last week in Colorado federal district court. Tubach is working with O'Melveny partner Anna Pletcher and associate Brian Quinn.

>> Dr. Andreas Pohlmann, of the firm Pohlmann & Company, has been named the compliance monitor for Ericsson in connection with the Swedish telecommunications company's recent settlement with the Justice Department resolving foreign bribery claims. Under the terms of its deferred prosecution agreement, Ericsson was required to retain a monitor for three years. Ericsson also agreed in December to pay more than $1 billion to resolve claims that it paid bribes from 2000 to 2017 to build business in Asia, Africa and the Middle East.

>> Lawyers from Greenberg Traurig filed new registrations for foreign clients including Mexico's secretariat of the economy; Kazakhstan and Turkey, according to DOJ's FARA database.

>> Sidley Austin partner Barry Rashkover, a co-leader of the firm's global securities enforcement team, advised Argo Group International Holdings, Ltd. as the Bermuda-based insurance company resolved claims that it failed to disclose perks and other benefits provided to its former chief executive. The SEC said Argo failed to disclose that it paid for the former CEO's "personal use of corporate aircraft, helicopter trips and other personal travel, housing costs, transportation for family members, personal services and club memberships," along with tickets and transportation to entertainment events. Argo agreed to pay a $900,000 without admitting to or denying the SEC's claims.

>> A team from Nixon Peabody, including Harry Kelly and Kenneth Silverberg, represents the estate of Tamir Sapir in a new tax case against the United States in the U.S. Court of Federal Claims in Washington. "This is an action seeking refunds of fiduciary income tax overpayments for two fiscal years, plus overpayment interest to the extent allowed by law," the Nixon Peabody lawyers wrote.

Compliance Reading Corner

Whistleblower Who Revealed Currency Abuses at BNY Mellon Gets $50 Million. "A former trader at Bank of New York Mellon who alerted authorities to the bank's pattern of overcharging big clients on currency trades was awarded a $50 million whistleblower payment Thursday—the largest of its type made by the Securities and Exchange Commission." [WSJ] More here at the NLJ. SEC whistleblower chief Jane Norberg (above): "Whistleblowers have proven to be a critical tool in the enforcement arsenal to combat fraud and protect investors."

Feds Drop Post-Conviction Case Against Iranian Businessman. "New York federal prosecutors on Friday abruptly gave up on their case against Iranian entrepreneur Ali Sadr Hashemi Nejad for violating U.S. sanctions, despite a jury conviction in March, citing disputes over evidence disclosure." [Law360] Read the government's nolle prosequi memo, and read the response here from the defense team at Steptoe & Johnson LLP. "Ali Sadr welcomes the government's decision to drop this misguided prosecution and wholeheartedly agrees that it is in the interest of justice for the Court to dismiss this case," Brian Heberlig wrote. The defense urged the trial judge to vacate the verdicts and dismiss the case with prejudice.

Trent Lott Fired by Top Lobbying Firm. "The prominent Washington law and lobbying firm Squire Patton Boggs fired former Senate Majority Leader Trent Lott, one of its top lobbyists, on Monday as Lott was preparing to decamp for another firm." [Politico] NLJ has more here.

Former Treasury Officials Positioned to Shape Fintech From Private Sector. "Financial technology companies are snapping up former government officials as they seek to navigate the still-developing patchwork of regulations governing cryptocurrency and other financial technology. A handful of recent high-profile hires could signal a stronger role being played by the private sector in the evolution of those rules." [WSJ]

Weatherford Ousts Legal, Compliance Chief After Bankruptcy Exit. "Weatherford International plc has ended the five-year tenure of general counsel and chief compliance officer Christina Ibrahim as part of a broader leadership organization." [Bloomberg Law]

FBI Wants Audit Firm to Review How It Makes FISA Wiretap Requests. "The FBI is looking for an audit firm to review its procedures for making foreign intelligence surveillance requests, as the agency continues to grapple with fallout from the errors in its pursuit of a wiretap of former Trump campaign adviser Carter Page. In a request for information dated June 5, the Federal Bureau of Investigation asked private sector firms to submit details about how they could help the FBI develop an audit of its processes around the Foreign Intelligence Surveillance Act, propose "best practice modifications" and offer guidance on implementing the audit program." [WSJ]

Feds Double Down on ERISA Disclosure Argument After SCOTUS Look. "Nothing in federal benefits law requires corporate insiders to make public disclosures beyond those required by securities law, the Labor Department and the Securities and Exchange Commission told the Second Circuit in letters that doubled down on their earlier position." [Bloomberg Law]

Court Overturns SEC Decision to Reject Fee Increases for Exchanges' Data Feeds. "In a victory for stock exchanges, a federal appeals court Friday overruled a decision by regulators to reject their attempt to raise prices for some market-data products. A three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit said regulators didn't have the authority to challenge the fees exchanges charge for streams of equity-market data that investors use to price orders. The Securities and Exchange Commission had based its decision on a section of law that "makes no mention of fees at all," the judges wrote. [WSJ]

Active U.S. Enforcement of Anti-Money Laundering Rules Continues Unabated. In 2019 global enforcers imposed more than $8 billion in anti-money laundering fines. Of the world's top 50 banks, 12 were hit with fines in 2019. Four months into 2020, this trend has continued. [New York Law Journal]

Notable Moves & Announcements

>> Jenner & Block has brought on David Robbins from Crowell & Moring to co-chair its government contracts practice, my colleague Samantha Stokes reports. Robbins joined Jenner's Washington, D.C., office this month just ahead of a shift in focus in government contract disputes. He represents clients in litigation matters such as False Claims Act defense, requests for equitable adjustment and whistleblower reprisal defense.

>> Citigroup Inc. has named Mary McNiff as chief compliance officer, succeeding Mark Carawan, who is retiring after eight years at the financial institution, Reuters reports. McNiff, who started June 8, had served as the CEO of Citibank N.A.

>> Jones Day said it had brought on Amy Harman Burkart as of counsel in the cybersecurity, privacy and data protection practice in Boston. Burkart formerly had led the cybersecurity unit of the U.S. attorney's office in Boston since 2017.