Two agencies and two kinds of provisions
The Foreign Corrupt Practices Act has anti-bribery provisions and, for companies whose securities trade in the United States, accounting provisions covering books and records and internal controls. Prosecutions are brought by the Justice Department, while the SEC pursues civil cases against issuers and their personnel. Companies without U.S.-listed securities can still face Justice Department action if they are U.S. businesses or act within the United States. The department has narrowed its enforcement focus in recent years, yet the statute itself was not changed, and requests for evidence from foreign governments can extend the time available to bring charges. A separate federal law now makes it a crime for foreign officials to demand bribes from U.S. companies.
Disclosure and cooperation decisions
When a company finds a possible violation, it faces a decision about voluntary self-disclosure. The Justice Department's corporate enforcement policy offers significant credit, potentially including a declination, to companies that come forward and cooperate, with conditions that need close review, but disclosure cannot be taken back and should follow a careful internal review. Cooperation now typically means sharing facts about individuals, so employees' interests can diverge sharply from the company's. People who worked on the deals should consider separate counsel, and the company's bylaws may provide for advancement of their legal fees. Foreign data privacy laws and blocking statutes can complicate collecting evidence overseas.
Defending the individual and the company
For individuals, FCPA defense often turns on knowledge, including whether the person was aware of a high probability that money would be passed to an official, which is a demanding standard for the government to meet. Jurisdiction over foreign nationals is a recurring issue, and courts have limited the government's reach in some cases. For companies, resolutions range from declinations to deferred or non-prosecution agreements to guilty pleas, often with monitorships or reporting obligations. Our first steps are understanding what has been found, who knows about it, and whether any agency has made contact.
