White Plains FCPA VIOLATIONS Lawyer
The Foreign Corrupt Practices Act of 1977 as amended, United States Code Title 15 Sections 78dd–1 et sequitur (15 US Code 78dd–1 et seq), forbids certain persons and entities from making payments to foreign government officials to obtain or retain business advantages or opportunities. The anti-bribery provisions prohibit the willful use of the mails or any instrumentality or medium of interstate commerce to make any offer, payment, promise to pay, or authorization to pay money or anything of value to any person to influence a foreign official to violate a legal duty or to secure any improper advantage in obtaining or retaining business for or with any person.
Since 1977, the anti-bribery provisions have applied to all Americans and to certain foreign issuers of securities. Since 1998, they have applied also to foreign firms and persons who act to cause corrupt payments to occur within the USA.
The law also requires companies with securities listed in the USA to meet accounting requirements (15 US Code 78m) designed to operate in tandem with the anti-bribery provisions to require corporations (a) to make and keep books and records that reflect corporate transactions accurately and fairly and (b) to maintain adequate internal accounting controls.
Enforcement of the Foreign Corrupt Practices Act is a high priority for both the United States Department of Justice (DOJ) and the United States Securities and Exchange Commission (SEC). In 2010, the SEC Enforcement Division created a specialized enforcement unit for enhanced deterrence of American businesses that might bribe foreign officials to obtain or retain government contracts and other business arrangements.
The DOJ prosecutes criminal violations, each of which incurs a fine of up to $2 million for business entities and for individuals a less enormous fine and the possibility of jail time. The penalty for an anti-bribery violation by a company director, officer, or stockholder is a fine of up to $100,000 and up to five years in prison per 15 US Code 78dd-2(g)(2)(A), 78dd-3(e)(2)(A).
In two of its most recent civil enforcement actions, the SEC charged (1) Goodyear Tire & Rubber Company with violating the law when subsidiaries paid bribes to negotiate tire sales in Kenya and Angola and (2) Avon Products Inc for failing to detect and prevent payments and gifts to Chinese government officials. Goodyear agreed to pay $16 million and Avon $135 million to settle the charges against them. Financial penalties under the law are painful and sometimes severe, and individuals risk lengthy prison sentences for any personal involvement in violations.
Attorney General Advisory Opinions
The subject matter of the law is complex, and its provisions can seem arcane and unclear. To help organizations and individuals at risk of exposure to opportunities for corrupt practices, the DOJ has established as provided expressly by 15 US Code 78dd–(e) a Foreign Corrupt Practices Act Opinion Procedure promulgated in the Code of Federal Regulations at Title 28 Part 80 (28 CFR Part 80). The procedure offers to all concerned access to opinions of the Attorney General as to whether certain specified, prospective conduct would be unlawful under present enforcement policy on the anti-bribery provisions of the law.
Per 28 CFR 80.6, each request for an opinion must be specific and include all relevant and material information about the prospective conduct. Each request must be signed by an appropriate senior officer with operational responsibility for the prospective conduct in question. The signatory must certify the request as a true, correct, and complete disclosure of the circumstances of the conduct. The procedure is obviously not free from risk if pursued without consummate skill and abundant caution.
Abundance of Caution
The DOJ recommends consultation with legal counsel whenever there is any question about whether contemplated conduct would be in complete compliance. The DOJ encourages consideration of use of the opinion procedure, in which the best way to proceed is with skilled, experienced trial counsel, former prosecutors competent, comfortable, and confident in courtrooms and fully familiar with every intricacy and pitfall of the law’s provisions.
The Foreign Corrupt Practices Act Opinion Procedure, handled adroitly, can save clients millions of dollars and protect them from the misery of criminal prosecutions. Be properly equipped and prepared.