Recent FCPA Resolution Points to DOJ’s Focus on Cartels, Adherence to Blanche Memo

Scoular, a leading agricultural supply chain company, has agreed to pay more than $10 million to resolve allegations that it violated the Foreign Corrupt Practices Act (FCPA) by authorizing bribes to Mexican officials that, unbeknownst to Scoular, ultimately flowed to drug cartels. The resolution underscores the US Department of Justice’s (DOJ’s) focus on anti-corruption enforcement in cases involving cartels and cross-border trade, consistent with the department’s recent guidance prioritizing cases involving US national security and US companies’ economic interests. The resolution has important implications for US businesses engaged in cross-border trade, especially those doing business in Mexico.

According to an unsealed information filed earlier this month, from 2013 to 2019, Scoular relied on customs brokers to ship corn and other products from the United States into Mexico. Mexican law required these shipments to be inspected for impurities, including dirt and soil. To ensure that shipments passed inspections, Scoular allegedly authorized third-party customs brokers to bribe Mexican officials at the border, with payments averaging approximately $2,000 per train.

Ultimately, DOJ charged that Scoular’s broker-bribery scheme involved the authorization of more than $400,000 in bribes and saved the company more than $6.5 million in fees and costs. Some of the bribe payments are alleged to have benefited individuals associated with cartel operations at the border.

KEY TAKEAWAYS

• Scoular agreed to pay more than $10 million and entered a three-year deferred prosecution agreement to resolve allegations of cartel-linked bribery at the US-Mexico border. Scoular’s lack of knowledge of cartel involvement did not preclude DOJ scrutiny.
• The resolution highlights DOJ’s targeted enforcement of the Foreign Corrupt Practices Act (FCPA) under the 2025 Blanche Memorandum and its particular focus on cartel-related activity.

CRIMINAL CHARGE AND RESOLUTION

On July 17, 2026, DOJ announced that Scoular had entered into a three-year deferred prosecution agreement (DPA). As of the publication of this LawFlash, the DPA remains under seal, but according to the DOJ press release, the agreement requires Scoular to pay a criminal penalty of over $9.7 million, plus forfeiture of more than $414,000. The DPA comes only weeks after DOJ filed a criminal information in the Western District of Texas charging Scoular with one count of conspiracy to violate the anti-bribery provisions of the FCPA under 18 USC § 371 and 15 USC § 78dd-2.

The DOJ emphasized the national security risks posed by such bribery, noting that “bribery and corruption not only undermine fair play and competition for Americans, but also hurt our national security interests in stopping the scourge of dangerous cartel activity.” According to the press release, the DPA further requires Scoular to continue to cooperate with the DOJ; implement and periodically report on a compliance and ethics program; and continue remediation efforts, including by updating policies and expanding training. The criminal penalty reflects a 25% reduction from the bottom of the applicable guidelines range, accounting for cooperation credit and remediation efforts.

OBSERVATIONS

The Scoular case sheds new light on the DOJ’s targeted approach to the FCPA in light of the department’s stated enforcement priorities. Then-Deputy Attorney General Todd Blanche described those new priorities in his June 2025 Memorandum on “Guidelines for Investigations and Enforcement of the Foreign Corrupt Practices Act (FCPA).” According to the Blanche Memorandum, DOJ will prioritize misconduct that (1) “is associated with the criminal operations of a Cartel or TCO;” (2) “deprive[s] . . . US entities of fair access to compete and/or result[s] in economic injury to . . . American companies or individuals;” and (3) poses the “most urgent threats to US national security resulting from the bribery of corrupt foreign officials involving key infrastructure or assets.”

The Blanche Memorandum further prioritizes investigation of “serious misconduct” as opposed to “routine practices or the type of corporate conduct that involves de minimis or low-dollar, generally accepted business courtesies.” The centrality of the Blanche Memorandum in establishing FCPA enforcement priorities was confirmed by Principal Associate Deputy Attorney General Trent McCotter in his letter stating the basis for the government’s motion to dismiss its FCPA charges against Indian billionaire Gautam Adani. McCotter said that the Blanche Memorandum “set a Department-wide policy” to refocus its FCPA enforcement, and that the Adani case failed to comport with those priorities, meaning that “the FCPA charges should have been dismissed a year ago.”

The Scoular case appears to check the Blanche Memorandum’s boxes, inasmuch as it involved hundreds of thousands of dollars in bribes paid over a six-year period. A portion of the bribes paid by Scoular “ultimately benefited people who helped operate a cartel,” which the DOJ regards as “hurt[ing] [its] national security interests in stopping the scourge of dangerous cartel activity.”

That suggests that cartel-related FCPA violations may inherently satisfy two separate prongs of the Blanche Memorandum (TCO-related criminal operations and urgent threats to US national security), posing significant risk to companies doing business in regions with an active cartel presence, even if companies are unaware that their payments ultimately flow to cartels. The Scoular case also involves conduct likely to compromise US entities’ ability to compete with Scoular, as non-bribe-paying US competitors could enter the Mexican market only by overcoming an inspection hurdle that Scoular paid bribes to bypass.

DOJ’s motivation to enter a DPA instead of pursuing litigation may arise from a combination of factors, including Scoular’s cooperation in the DOJ’s investigation and its determination that “Scoular did not know about” the flow of its bribe payments to drug cartels. But its decision to pursue the case demonstrates its commitment to the Blanche Memorandum’s directive.

RECOMMENDATIONS

In light of the Scoular DPA, companies facing FCPA exposure should be aware that cases with cartel connections are likely to generate heightened attention from DOJ, regardless of whether the target of an investigation was aware of the cartel nexus. Companies should work to

• review and strengthen internal controls over third-party relationships, particularly customs brokers, to mitigate bribery risks and ensure all payments are legitimate and properly documented;
• monitor high-risk transactions, particularly in countries with an active drug cartel presence, and adopt software tools or technologies to support risk-based review and compliance monitoring; and
• implement risk-based screening, approval requirements, and anti-corruption provisions in third-party contracts, as Scoular did in its remediation efforts.

CONCLUSION

The DOJ’s resolution with Scoular reflects the agency’s mission-tailored enforcement of anti-corruption laws and the expectation that US companies proactively manage compliance risks, particularly in cross-border operations that have the potential to benefit cartels and TCOs. The case highlights the cross-pollination risk between government corruption and organized crime, and the importance of robust compliance programs, effective internal controls, and prompt remediation in mitigating penalties and reputational harm.

Businesses operating internationally should take note of the DOJ’s guidance, including the Blanche Memorandum, and should prioritize anti-corruption compliance to avoid similar enforcement actions