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FCPA Compliance Lessons from “The Informant” (Part 1: Wearing a wire for the FBI)

[1]You might recognize Mark Whitacre [2] from the movie The Informant. Matt Damon played his role as a whistleblower in a multi-billion dollar price fixing scheme. While Mr. Whitacre was ADM’s Divisional President of the BioProducts Division and Corporate Vice President of the company, he cooperated with the FBI, wearing a wire over the span of three years and helping to build a case that resulted in prison for top executives and the largest anti-trust fine in U.S. history at the time. He also wound up going to prison himself for defrauding the company out of several million dollars.

After serving nine years in prison, Mr. Whitacre has taken responsibility for his actions and dedicated his life to sharing lessons he learned about ethics and corporate responsibility. I recently shared the stage with him at a series of ethics conferences in South America. I found him to be highly credible and his personal story of redemption to be inspirational. The FBI does too, as shown in this recent Discovery Channel special [3]. Mr. Whitacre agreed to be interviewed by FCPAméricas and share lessons that are directly relevant to the FCPA compliance community.

FCPA violations can be criminal in nature. What was it like being directly involved in criminal activity yourself?

It was incredibly unsettling, even worse than my nine years in prison. I was swept up into the scheme because the compensation was so good. Seven figures, and this was 1989, and I was only 32 years old. But being involved in crime weighs heavily on you. This is how my wife finally detected that there was something wrong. She knew I had changed. I finally told her about the international cartel that my company had asked me to be involved with, and that I was involved with for seven months. It was a price fixing scheme that had already been going on for many years, and she convinced me to blow the whistle to the FBI.

In fact, it almost felt good when I told her and when I told the FBI. Participating in crime is worse than prison because you can’t look yourself in the mirror. You aren’t proud of yourself or your job anymore. I actually found peace in prison because everything was already exposed.

The FBI has now trained a special unit to investigate foreign bribery, and U.S. investigators are starting to use undercover informants who wear wires, such as in the BizJet, William Jefferson, and BSG Resources Ltd. investigations. What was it like for you to wear a wire?

It was very uncomfortable, especially because the FBI told me that my life was in danger. There were many foreign companies from Europe and Asia involved in the international cartel, and no one knew what they would do. The FBI also did not know what my own employer would do if it found out. They said that, with corporate jets and everything, accidents do happen.

But the FBI agents were real professionals. They knew exactly what they were doing. Every day they would shave my chest, tape the microphone to it, and then we would meet for several hours in the evenings twice a week to go over the recordings. I wore that wire for three years. The most challenging part was when friends who were not even part of the crime would start discussing personal matters that would get caught on tape. I knew that these recordings would one day get turned over to the court and would then become public and the media would have access to them.

When you wear a wire, the FBI trains you not to lead anyone. You are told to let conversations flow naturally. But there was one meeting in Hawaii when the prosecutors needed someone to say the word “agreement.” So I kept saying things like, “what are we saying here?” Then one of the guys finally said it for the first time, “we have an agreement.” It took some questioning before someone actually said that word.

I never felt that anyone was on to me. My colleagues were always so open with me. They trusted me. I was in line to be the next president. No one knew.

Part 2 [4] of this series will discuss what it was like being a whistleblower. 

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