November 12, 2020

Federal and Florida Officials Discuss Enforcement Priorities and How Corporations Can Minimize Risk

Holland & Knight Alert
Wifredo A. Ferrer | William N. Shepherd | David L. Haller


  • The Third Annual Florida Enforcement Summit, hosted by Holland & Knight, the Florida Chamber of Commerce, the Miami-Dade Chamber of Commerce and the Miami-Dade Beacon Council, focused on federal and Florida enforcement priorities.
  • Summit speakers included the U.S. Attorney for the Southern District of Florida, the Regional Director of the U.S. Securities and Exchange Commission, and the Statewide Prosecutor of Florida.
  • The speakers shared their insights on current enforcement priorities and provided advice on how businesses can minimize enforcement risks by implementing robust compliance programs.

Holland & Knight, the Florida Chamber of Commerce, the Miami-Dade Chamber of Commerce and the Miami-Dade Beacon Council hosted the Third Annual Florida Enforcement Summit on Oct. 28, 2020. The half-day program focused on current federal and Florida enforcement priorities and effective corporate compliance programs.

Guest speakers at the Third Annual Florida Enforcement Summit included:

Panelists from Holland & Knight included:

  • Miami Partner Wifredo Ferrer, former U.S. Attorney for the Southern District of Florida
  • Miami Partner Mitchell Herr, former Regional Trial Counsel, SEC, Miami Regional Office
  • West Palm Beach Partner William Shepherd, former Statewide Prosecutor of Florida

Guest Speaker Highlights

Panel I: Federal Enforcement Priorities and Investigations in the COVID-19 Era; How Federal Authorities Evaluate Corporate Compliance Programs

Ariana Fajardo Orshan: U.S. Attorney for the Southern District of Florida

Fajardo Orshan, who serves as the U.S. Attorney for the Southern District of Florida, the lead federal law enforcement officer in South Florida, shared her insights into current enforcement priorities and gave an update on the Money Laundering Section.

  • She stated that the U.S. Attorney's Office for the Southern District of Florida's recent focus has been fraud cases and investigations, especially those related to COVID-19. Her office prioritized investigations related to price gouging, Paycheck Protection Program (PPP) fraud, cargo theft and other improper uses of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) funding over the past several months.
  • In fact, the U.S. Attorney's Office for the Southern District of Florida's Money Laundering Section has seized more than $450 million in the past year. Fajardo Orshan explained that the Section's seizures were primarily related to Foreign Corrupt Practices Act (FCPA) violations, but that the Section is also looking into banking and real estate sector involvement in money laundering activities.

Fajardo Orshan also shared best practices for handling federal funds as well as implementing and administering effective compliance programs.

  • To begin, Fajardo Orshan recommended that businesses fully educate themselves and their employees on the ramifications of accepting and spending government money. In particular, she advised businesses that, before they take public funds, they should 1) understand the stipulations associated with doing so, 2) institute robust compliance programs to ensure that those stipulations are adhered to, and 3) seek counsel if they have questions about those stipulations or how to create or administer an effective compliance program. The U.S. Attorney also stated that it was important to document how and why the business spent the money as it did in case the business' past expenditures are ever investigated.
  • Fajardo Orshan further recommended that businesses consult the U.S. Department of Justice's (DOJ) newly updated Evaluation of Corporate Compliance Programs Guide and specifically the changes regarding how the DOJ's Criminal Division evaluates corporate compliance programs.
  • Rather than just reviewing the company's compliance manual, the DOJ looks at the compliance program that the company has actually implemented, evaluates the effectiveness of that program as implemented, considers what, if any, lessons the company has learned, and determines whether actions have been taken in response to those lessons.
  • Fajardo Orshan emphasized the importance of consistently testing the effectiveness of a company's compliance program. The programs should, of course, be adjusted as the company evolves and expands.
  • Ultimately, it is all about intent. The U.S. Attorney made clear that the DOJ understands that mistakes are made, but is far more likely to forgive a mistake when a company can prove that it did everything possible to prevent the mistake and resulting misconduct in question.

Eric Bustillo: Regional Director, U.S. Securities and Exchange Commission, Miami Regional Office

Bustillo, who serves as the Regional Director of the SEC's Miami Regional Office, the lead SEC enforcement official in Florida, Mississippi, Louisiana, Puerto Rico and the U.S. Virgin Islands, shared his insights into current SEC enforcement priorities and policy updates.

  • As COVID-19 arrived in the United States, the SEC was expecting some businesses to use the pandemic for fraudulent purposes and personal gain. Therefore, Bustillo stated, the SEC quickly created a committee to address pandemic-related fraud. According to Bustillo, there are approximately 150 active SEC investigations concerning COVID-19 fraud. The SEC's COVID-19-related cases have involved public disclosures concerning purported COVID-19 protection, treatments and cures.
  • Bustillo announced that in July 2020, the DOJ and the SEC released an updated version of the Resource Guide to the Foreign Corrupt Practices Act. Since the Resource Guide was release in 2012, there have been 275 FCPA enforcement actions resulting in more than $7 billion in monetary penalties. The new version provides examples and factual scenarios to help companies better understand FCPA enforcement, recent policy changes with respect to corporate enforcement, and information on pre- and post-acquisition due diligence. The latest version also includes a new section entitled "Investigation, Analysis, and Remediation of Misconduct." It explains the components that the DOJ and SEC look for in an effective compliance program.

Bustillo went on to discuss how businesses can and should use compliance programs and the success of the SEC's Whistleblower Program.

  • The SEC Regional Director advised businesses to record how they evaluate and reevaluate their compliance programs. He also recommended that businesses consistently modify their programs as the business evolves and expands.
  • The SEC's Whistleblower Program, established in 2011 as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act, has made compliance programs even more important than before. The program has paid out more than $700 million in awards to whistleblowers, and has resulted in recoveries of more than $2 billion. Bustillo stated that the incentives created by the SEC Whistleblower Program make it likely that if a company does not prevent misconduct through its compliance program or self-report misconduct upon discovery, the SEC will learn of the misconduct directly from whistleblowers.

Panel II: State Enforcement Priorities, Interplay with Civil Enforcement and Cooperation with Federal Enforcement Authorities

Nicholas Cox: Statewide Prosecutor of Florida

Cox, who serves as Florida's Statewide Prosecutor and is directed by the Florida Constitution to prosecute crimes that impact two or more judicial circuits in the state, shared his insights into current Florida enforcement priorities and discussed how businesses can protect themselves against criminal activity.

  • According to Cox, the Office of Statewide Prosecution is currently prioritizing organized crime across circuit lines, especially fraud, computer fraud, cargo theft and crimes against seniors. Cox noted that cargo theft has become a significant concern this year as it has resulted in more than $10 million in losses for the state of Florida. It should be front of mind for those business operating in the transportation and retail industries.
  • Cox advised businesses in the transportation and retail industries to notify law enforcement as early as possible if they suspect cargo theft and to be ready to fully cooperate with law enforcement to ensure that those who engage in criminal activity are apprehended and prosecuted.

Cox went on to discuss the importance of the Office of Statewide Prosecution's partnership with other state and federal authorities.

  • Cox stated that Florida state authorities often work closely with federal authorities and decide who will take the lead on certain investigation based on who will be able to recover the most for the victims of the crime in question.

About Our Teams

If you have questions about any of the topics covered during the panel discussions, Holland & Knight's Global Compliance and Investigations Team, White Collar Defense and Investigations Team, and Consumer Protection Defense and Compliance Team can provide additional information. All three teams are comprised of individuals with extensive experience handling DOJ, SEC, Federal Trade Commission (FTC), Consumer Financial Protection Bureau (CFPB), State Attorneys General and other regulatory investigations. Our attorneys can provide advice not only on how to navigate those investigations once they begin but also on how to avoid them in the first place.

Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem, and it should not be substituted for legal advice, which relies on a specific factual analysis. Moreover, the laws of each jurisdiction are different and are constantly changing. This information is not intended to create, and receipt of it does not constitute, an attorney-client relationship. If you have specific questions regarding a particular fact situation, we urge you to consult the authors of this publication, your Holland & Knight representative or other competent legal counsel.

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