United States: Third FARA Lawsuit Shows Focus On Civil Enforcement22

On April 25, 2023, the U.S. Department of Justice ("DOJ") filed a civil enforcement action seeking to compel the Federación de Alcades Pedaneo ("FDAP") to comply with requirements for registrants under the Foreign Agents Registration Act ("FARA" or the "Act"). The complaint is the third of its kind since 2019, signaling the DOJ's growing interest in robust civil enforcement of FARA—DOJ previously had not filed a complaint for more than 30 years.

I. The Complaint

FDAP is an organization that consults and serves as advisors for geopolitics in the Caribbean and Latin America and has been registered under FARA since May 2020. The company became a subject of a DOJ inquiry after failing to comply with several requirements, including failure to file supplemental statements and its bylaws or charter.¹

FARA provides that an entity that engages in certain activities at the request, direction, or control of a foreign principal must register with the DOJ, absent an exemption. Although only willful failure to register is a criminal offense, DOJ is empowered to seek injunctive relief "requiring compliance with any appropriate [FARA] provision."²

Before filing their complaint, DOJ's FARA Unit—which administers and enforces the law—made several outreach attempts regarding the deficiencies. The Unit sent two letters notifying the company of its failure to comply, following by a Notice of Deficiency ("NOD"). After receiving the NOD, FDAP responded with a request for a one-month extension, which was granted. The FARA Unit did not hear from FDAP by the extended deadline, prompting the FARA Unit to send a formal Notice of Non-Compliance ("NONC"), pursuant to 22 U.S.C. § 618(g), on December 20, 2022, alerting the company that it was now "out of compliance" with the Act.

The FARA Unit restarted its practice of sending NONCs only a few years ago. Critically, an NONC pursuant to Section 618(g) gives the recipient 10 days to rectify the stated deficiencies before being prohibited from further acting as an agent for a foreign principal. In addition to buttressing civil enforcement options, the NONC may also create criminal liability for FDAP if they willfully continue to act as a foreign agent.

II. Focus on Civil Enforcement

Throughout most of FARA's history, the FARA Unit typically responded to registration deficiencies with letters and informal requests for compliance. This action against FDAP is yet another shift to more aggressive enforcement of FARA. Highlighting this push on civil enforcement, the FARA Unit has been hiring attorneys with civil litigation experience, including the attorney on the FDAP complaint.

Footnotes

1. 22 U.S.C. § 612(a); 22 U.S.C. § 612(a)(2) and 28 C.F.R. § 5.201(c)(1).

2. 22 U.S.C. § 618(f).

Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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