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Trump EO Pauses FCPA Enforcement After DOJ Day-One Directives Announce Significant Shift in Priorities, Including the Reorientation of FCPA, FARA and Money Laundering Enforcement

February 13, 2025 Download PDF

For additional guidance on the Trump administration’s executive orders, visit our Regulatory/Administrative Tracker.

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On February 5, 2025, Attorney General Pamela Bondi issued 14 directives intended to align the U.S. Department of Justice (DOJ) with President Trump’s stated policies and to lay the foundation for the DOJ to execute those policies under her leadership. These directives, issued in the form of memos to all DOJ employees, cover a wide range of topics and, among other things, establish a Weaponization Working Group to review law enforcement actions taken under the Biden administration for any examples of politicized actions; create a task force focused on Hamas’ October 7, 2023 attack in Israel; and lift the moratorium on the federal death penalty.

The directives also announced new enforcement policies and priorities, including a reorientation of several long-standing areas of DOJ focus: foreign corruption, money laundering, asset forfeiture and certain national security offenses. The memos direct the nation’s federal prosecutors to shift their attention to the total elimination of cartels and transnational criminal organizations (TCOs).[1]  The memos also disband several kleptocracy and national security initiatives, including the Biden DOJ’s primary task force on criminal enforcement of the sanctions against Russia following its 2022 Ukraine invasion, though they do not impact ongoing sanctions enforcement by the US Department of the Treasury’s Office of Foreign Assets Control (OFAC), including the Russia sanctions regime.

Within days of the DOJ issuing its directives, on February 10, 2025, the White House issued its Executive Order Pausing FCPA Enforcement to Further American Economic and National Security requiring a 180-day pause on all new Foreign Corrupt Practices Act (“FCPA”) investigations or enforcement actions, as well as a review of all existing FCPA matters.  During the pause, which can be extended for an additional 180 days, the Attorney General is required to issue FCPA enforcement guidelines for future cases, all of which must be approved by the Attorney General.  The Order also calls for a retrospective review of prior FCPA investigations and enforcement actions.

In light of these important shifts in DOJ policies and priorities, companies should assess their business operations and reevaluate their existing compliance programs to ensure that they properly mitigate risks associated with any known or unknown involvement with cartels and TCOs. Companies involved in agriculture, manufacturing, mining, logistics, oil and supply chains may be at higher risk under the new regime, to the extent that their products are sourced from or moved through, or their facilities are located in, regions with heightened cartel and TCO activity. Likewise, financial institutions dealing with transactions involving entities located in higher-risk regions may face additional scrutiny.

Two of these recent memos, titled “General Policy Regarding Charging, Plea Negotiations, and Sentencing” (AG Charging Memo) and “Total Elimination of Cartels and TCOs Memorandum” (AG Cartel Memo), enact some of the most significant changes in the Trump Administration’s approach and are expected to have a substantial impact on criminal enforcement.

Foreign Corruption

The Executive Order directs the Attorney General to cease for 180 days the “initiation of any new FCPA investigations or enforcement actions, unless the Attorney General determines that an individual exception should be made,” as well as to “review in detail all existing FCPA investigations or enforcement actions.”   During the pause, the Attorney General must develop updated guidelines that ensure “American economic competitiveness with respect to other nations” to govern all FCPA investigations and enforcement actions, and any future FCPA matters must “be specifically authorized by the Attorney General.”  The Order also instructs the Attorney General to consider whether any remedial measures are needed for any “inappropriate past FCPA investigations and enforcement actions.”  The Order omits details on the implementation of its mandates, including how far back in time the case review should extend, what qualifies as “inappropriate,” and the range of permissible remedies. 

The Executive Order expresses the view that prohibitions on bribery undermine the competitiveness of U.S. companies abroad.  As explained in the “Fact Sheet” accompanying the Order:  “U.S. companies are harmed by FCPA overenforcement because they are prohibited from engaging in practices common among international competitors, creating an uneven playing field.”[2]  Both the Order and Fact Sheet also state that the FCPA undermines “American national security” because it thwarts companies from gaining “strategic business advantages” aboard.[3]

The AG Cartel Memo directs the DOJ Criminal Division’s FCPA Unit to prioritize investigations and prosecutions of bribery of foreign public officials that facilitate the criminal operations of cartels and TCOs, such as bribery of foreign officials to enable human smuggling and the trafficking of narcotics and firearms. Prosecutors are instructed to shift focus away from investigations and cases that do not involve such a connection, which could impact the number of investigations and prosecutions by the FCPA Unit.  Factors that may mitigate any impact include that some companies will continue to self-disclose; the SEC and DOJ whistleblower hotlines will continue to receive FCPA tips; foreign authorities will continue to refer allegations; and, as discussed immediately below, a broader set of federal prosecutors will be freed to pursue cartel/TCO-related FCPA cases with less involvement of the FCPA Unit. 

Although the DOJ has previously brought corruption-related cases tied to TCO activity—such as the 2020 drug- and firearm-related charges brought against former president of Venezuela, Nicolás Maduro Moros, and several other Venezuelan leaders, and the 2023 drug-related conviction against former Mexican Secretary of Public Security, Genaro García Luna—there is limited history of FCPA charges directly tied to this type of activity.  One example is the prosecution of Ukrainian businessman Dmitry Firtash, a pending case dating back to 2013 which accuses Firtash of leading a “criminal enterprise” that “brib[ed] Indian public officials” to secure mining rights in India.[4]

In addition, with respect to cartel/TCO-related matters, the memo suspends prior internal DOJ policies (found in the Justice Manual) that required the Criminal Division to authorize an investigation or prosecution of a case under the FCPA or the Foreign Extortion Prevention Act (FEPA), as well as the requirement that such cases be conducted by trial attorneys of the Fraud Section. As a result, U.S. Attorney’s Offices will now have more discretion and flexibility to pursue FCPA and FEPA cases that have a link to cartels or TCOs, and those cases may be pursued with less involvement by the Criminal Division.

Neither the AG Cartel Memo nor the other DOJ memos affect the sanctions work of the US Department of the Treasury’s Office of Foreign Assets Control, which will continue to administer and enforce economic and trade sanctions, or the US Department of State's Office of Economic Sanctions Policy and Implementation, which will continue to develop and implement foreign policy-related sanctions.

Money Laundering and Asset Forfeiture

The AG Cartel Memo also requires the DOJ Criminal Division’s Money Laundering and Asset Recovery Section (MLARS) to prioritize investigations, prosecutions and asset forfeiture actions that target the activities of cartels and TCOs.  Although the memo does not provide examples, it appears that such cartel activities could involve the laundering of illicit proceeds, the financing of criminal operations and the acquisition of assets derived from or used for criminal purposes.

National Security

The AG Charging Memo establishes new enforcement and resource priorities for the National Security Division (NSD). Most notably, the memo requires prosecutors to limit the use of criminal charges under the Foreign Agents Registration Act (FARA) and 18 U.S.C. § 951, which generally prohibit acting as an agent of a foreign principal without proper registration or notification, to instances of “alleged conduct similar to more traditional espionage by foreign government actors.” The memo also calls on NSD’s Counterintelligence and Export Control Section, including the FARA Unit, to focus on civil enforcement, regulatory initiatives and public guidance with respect to FARA and § 951, rather than pursuing criminal charges. The memo does not address the prior administration’s DOJ December 19, 2024 Notice of Proposed Rulemaking (NPRM) related to FARA. That proposed rule would narrow the FARA exemption for commercial activities and make other updates that would expand the scope of activities and entities subject to FARA’s registration requirements.

The memo also disbands: (1) NSD’s Corporate Enforcement Unit, a recent initiative from the last administration that focused on corporate enforcement in export controls, sanctions and other national security cases; and (2) the Foreign Influence Task Force, which was established in 2017 to combat covert foreign influence operations in the United States.   As previously noted, none of these AG Memos impacts the sanctions enforcement work of OFAC, and DOJ prosecutors can still pursue charges against operators of foreign influence campaigns outside the framework of the task force.

The AG Charging Memo’s likely impact on NSD’s corporate white collar focus is unclear.   At least with respect to FARA enforcement, the NSD had already narrowed the scope of such enforcement after a series of court rulings had limited the scope of FARA and the memo is clear that the new administration intends to forgo criminal prosecution except in instances that bear the hallmarks of traditional espionage.     

Charging and Sentencing Policies

The AG Charging Memo contains extensive guidance for prosecutors to consider in charging, plea negotiations and sentencing decisions. Notably, the memo repeatedly emphasizes the need to avoid making such decisions based on political views or affiliations. For example, the memo emphasizes that charging decisions may not be influenced in any respect by a subject’s political association, activities, or beliefs. Similarly, the memo states that “[t]here is no room in plea bargaining for political animus or other hostility.” 

Other New Policies and Guidance

In addition to the memos described above, the DOJ has published two memos addressing (a) the use of sub-regulatory guidance—guidance that did not go through notice-and-comment rulemaking—in enforcement actions and (b) the  advocacy required to implement the current Administration’s priorities:

Key Takeaways

These developments reflect a reorientation of the DOJ’s enforcement priorities, which are expected to have an impact on the nature and volume of enforcement actions traditionally brought by the Criminal Division’s FCPA Unit and MLARS, the National Security Division and possibly other components. There are also factors mitigating against any dramatic change in enforcement activity.  We will continue to monitor developments in these areas, including the rollout of DOJ’s new FCPA enforcement guidelines following the enforcement pause, the review of present and past FCPA enforcement actions, and whether the provisional DOJ directives are ultimately adopted as-is or amended,[5] and report on enforcement activity and other developments including in our various Year in Review publications.[6]

Regardless of whether the Executive Order and the new directives have a long-term impact on enforcement activity in these areas, they do contain important pronouncements.  Companies should consider the following potential implications of these new policies:

  • Companies should take a close look at their compliance programs, including their know-your-customer and third-party risk management practices, to ensure that they are addressing cartel and TCO risks. Counterparty risk management processes, including due diligence, engagement and monitoring practices may need to be adjusted to account for these risks. Some cartels and TCOs, along with their leadership, already appear on sanctions lists maintained by OFAC, which will be helpful for companies that already incorporate sanctions screening in their compliance programs.
  • These latest shifts in enforcement priorities are not a safeguard against investigation or prosecution for corruption or money laundering-related offenses. As a result, companies are cautioned against any de-investment in compliance programs or related controls in light of these latest developments.
    • The statute of limitations for most federal crimes is five years (six years for certain FCPA offenses, ten years for bank fraud), meaning relevant offenses that occurred in the recent past or during the current administration could be prosecuted by a subsequent administration. Moreover, prosecutors in the early stages of investigations frequently request—and receive—tolling agreements, or obtain court tolling orders based on requests for foreign evidence, which allow the DOJ (as well as the SEC) to bring enforcement actions for conduct that occurred much earlier in time. 
    • While temporarily frozen, FCPA investigations that were in motion prior to February 10th—some known to the subjects of the investigation, and some unknown—may ultimately proceed on track following the Attorney General’s review of those cases, regardless of whether they have a cartel/TCO nexus.
    • The DOJ’s shift in priorities does not extend to other federal regulators, including the SEC, which has its own FCPA Unit to investigate and prosecute violations of the FCPA’s anti-bribery and internal accounting provisions involving issuers, and the Commodity Futures Trading Commission, which has brought several foreign bribery actions under the Commodities Exchange Act. The Executive Order’s discussion of the foreign affairs, economic and national security prerogative of the President, however, suggest that civil enforcement actions by the SEC or other federal regulators may also be impacted.
    • Various state authorities, especially State Attorneys General from Democratic states, may seek to fill the enforcement void and, to the extent there is state legislation and a sufficient jurisdictional hook, investigate companies for misconduct that has traditionally been the province of federal regulators. We may also see an uptick in transnational bribery cases from select local prosecutors such as the Manhattan District Attorney’s Office, which has a history of pursing complex, cross-border financial crime, and may similarly shift more attention to foreign bribery. 
    • The DOJ’s directives may draw resources from enforcement areas not directly tied to cartel or TCO activity. For example, the shift in priorities could reallocate the DOJ’s FCPA-focused resources, which, in contrast to the DOJ’s Narcotics-, MLARS- and Violent Crime and Racketeering Section-focused resources, historically have not been used to target cartel and TCO-related activity. Similarly, DOJ enforcements efforts related to kleptocracy, sanctions and money laundering that do not involve cartels or TCOs may be less of an emphasis in the new administration.  However, as we have noted, even if there is some resource reduction, that may be counterbalanced by other circumstances and developments which could help DOJ maintain its impact in these enforcement areas.
  • Finally, companies should not assume that the DOJ will drop existing investigations following its review, nor should they assume that significant conduct not falling clearly within the newly-articulated priorities will not be investigated.

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[1] See Paul, Weiss, Rifkind, Wharton & Garrison LLP, President Trump Issues Executive Order Signaling a Push to Designate Drug Cartels as Foreign Terrorist Organizations (Feb. 3, 2025), https://www.paulweiss.com/practices/litigation/economic-sanctions-aml/publications/president-trump-issues-executive-order-signaling-a-push-to-designate-drug-cartels-as-foreign-terrorist-organizations?id=56400.

[2] White House, “Fact Sheet: President Donald J. Trump Restores American Competitiveness and Security in FCPA Enforcement” (Feb. 10, 2025), https://www.whitehouse.gov/fact-sheets/2025/02/fact-sheet-president-donald-j-trump-restores-american-competitiveness-and-security-in-fcpa-enforcement/

[3] Although not discussed in the Executive Order, the FCPA has a specific provision that addresses US national security, which states:  “With respect to matters concerning the national security of the United States, no duty or liability under [the books and records and internal controls provisions] shall be imposed upon any person acting in cooperation with the head of any Federal department or agency responsible for such matters if such act in cooperation with such head of a department or agency was done upon the specific, written directive of the head of such department or agency pursuant to Presidential authority to issue such directives.”  15 U.S. Code § 78m(b)(3)(A).

[4] See Indictment, United States v. Firtash, No. 13-CR-515 (N.D. Ill.), https://www.justice.gov/sites/default/files/criminal-fraud/legacy/2014/04/03/df_indictment_final_stamped_6-20-13.pdf.

[5] The AG Cartel Memo provides that “the changes set forth below will be implemented for a period of 90 days and renewed or made permanent thereafter as deemed appropriate by the Office of the Attorney General and the Office of the Deputy Attorney General.”

[6] See Paul, Weiss, Rifkind, Wharton & Garrison LLP, 2024 Year in Review: FCPA Enforcement and Anti-Corruption Developments; 2024 Year in Review:  Economic Sanctions and Anti-Money Laundering Developments; 2024 Year in Review: CFIUS, Outbound Investments and Export Controls.

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