Companies seeking to help their Ukrainian employees safely exit Ukraine should be aware of potential risks related to the Foreign Corrupt Practices Act (FCPA) and other U.S. laws and regulations. Following Russia’s invasion of Ukraine, Ukraine’s President Volodymyr Zelensky ordered a general military mobilization and declared martial law to ban male Ukrainian citizens, aged 18-60, from leaving Ukraine.
Many companies spanning a wide variety of sectors—from banks to law firms to tech companies and non-profits—employ Ukrainians subject to this ban. Over the past few weeks, several of these companies have hired expert security firms and mercenaries to help their employees and contractors exit Ukraine safely, including by providing visa assistance and cash. Reportedly, these “evacuation efforts have been complicated by Ukraine’s decree that most men ages 18 to 60 must remain in the country.”
Considering the turmoil in Ukraine, the employers’ desire to help employees leave Ukraine safely is understandable. But in any such efforts, companies need to be mindful of the potential legal risks involved, should their assistance result in the employees’ defiance of Ukraine’s martial law decree. Besides the risk of violating Ukraine’s law, risks may arise under the FCPA, money laundering laws, the False Claims Act, 18. U.S.C. Section 1001 (False Statements to Government Officials), immigration laws, and sanctions regulations, not to mention internal corporate compliance policies.
Two types of FCPA liability may arise from employers’ efforts to facilitate the extraction of Ukrainian male employees from Ukraine. First, the anti-bribery provision prohibits bribery of foreign officials to obtain or retain business by U.S. persons and businesses, U.S. and foreign companies listed on U.S. stock exchanges or that are required to file periodic reports with the SEC, and certain foreign persons and businesses acting while in U.S. territory. The FCPA also expressly prohibits corrupt payments made through third parties or intermediaries. Because extracting employees from Ukraine may be considered a business advantage, the FCPA’s bribery provision may apply in this context. Indeed, we understand that FCPA issues involving comparable scenarios have arisen before.
Additionally, the FCPA books and records provision requires public companies to (1) make and keep books and records that accurately and fairly reflect the transactions of the corporation, and (2) devise and maintain an adequate system of internal accounting controls. Therefore, a public corporation risks liability should it inaccurately record payments made to secure Ukrainian employees’ extractions, or should such payments be made in violation of anti-corruption policies or in contradiction to anti-corruption controls.
Employers also risk liability under money laundering laws, particularly Section § 1956(a)(2) criminalizing international money laundering transactions. Using the U.S. financial institutions to promote, or conceal proceeds from, certain “specified unlawful activities” (SUAs) is a crime. There over 200 SUAs that can serve as predicates for a money-laundering charge. They include bribery, fraudulent immigration actions, and certain offenses in violation of the laws of a foreign nation. Liability risk exists, even when the underlying criminal activity occurs abroad and the only activities occurring in the United States are bank transfers. A money laundering charge may accompany other charges, or may stand on its own.
There is some risk that, if a company’s employee makes false statements to a U.S. immigration official to obtain U.S. immigration status, orally or in writing, that employee could face liability under 18 U.S.C. § 1001 (False Statements) or various immigration fraud statutes. Numerous individuals have been convicted for making false statements to immigration officials, including for making false statements orally and on written customs forms. There are even more cases where false statements to immigration officials constituted immigration fraud. Importantly, under 18 U.S.C. § 2 (aiding and abetting); 18 U.S.C. § 371 (conspiracy), employers could face liability risk too, should their efforts be construed as knowingly aiding and abetting or conspiring to help their employees make false statements during immigration proceedings. Immigration fraud may be a separate offense or serve as a predicate for a money laundering charge.
Employers who are U.S. government contractors face additional civil liability risks under the False Claim Act (FCA) should they submit false claims to the U.S. Government meant to mask improper payments made to extract Ukrainian employees from the country. The FCA prohibits, among other things, presenting a false claim to the U.S. government, making or using a false record or statement material to a false claim, or conspiring to do so. Recently, a government contractor faced FCA liability when its bribery scheme caused another government contractor to submit false invoices to the U.S. government. And there have been other instances where companies have faced dual FCPA/FCA allegations for bribery schemes in the United States and abroad.
In response to Russia’s invasion of Ukraine, the United States and its allies have imposed expansive and unprecedented sanctions against Russian banks, entities, and individuals. Certain areas of Ukraine are also subject to comprehensive embargo restrictions. Should any employers transact with individuals or corporations associated any sanctioned individuals, companies, or financial institutions, or in those embargoed regions, they risk sanctions liability based on a strict liability standard. This means, in many cases, a U.S. person may be held civilly liable for sanctions violations even without having knowledge or reason to know it was engaging in such a violation.
Since Russia’s invasion of Ukraine, the DOJ unsealed its first-ever criminal indictment charging a violation of Crimea-related sanctions violations. With the new KleptoCapture Task Force, tasked with “investigating and prosecuting violations of new and future sanctions imposed in response to the Ukraine invasion,” the enforcement activity will intensify in the near future.
The situation in Ukraine is tragic—and employers understandably and admirably want to protect Ukrainian employees and their families. The United States and its allies have united in support of Ukraine and its people. Governments have provided humanitarian and military assistance. Millions of people across the world have donated cash, cryptocurrency, and food, volunteered their time, and protested in solidarity. In tandem, the United States and its allies have made clear their strong disapproval of Russia’s actions and joined forces in the imposition of sanctions and enforcement efforts.
Against this backdrop, the U.S. government may not have the appetite for invoking the laws discussed above to prosecute companies that help their Ukrainian male employees get to safety. It is more likely that the government will put its efforts into investigating and prosecuting “those whose criminal acts enable the Russian government to continue this unjust war.”
Nevertheless, companies should think twice before engaging third parties to facilitate employee extraction. Companies that decide to take the risk must take precautions, including conducting thorough third-party diligence and investigation of the methods used by any affiliates or third parties on the ground to facilitate employee evacuations. They should also adhere to their internal compliance policies and follow escalation and exceptions processes, as appropriate.
 18 U.S.C. § 1546 (prohibits fraud related to any immigrant and nonimmigration visa, including using fraudulent immigration documents or making any false claim or statement to obtain visas or other immigration document); 18 U.S.C. § 1028 (establishes a general criminal penalty for document fraud in connection with identification documents and document authentication features); 8 U.S.C. § 1324(c) (establishes civil penalties for immigration document fraud).