The Foreign Corrupt Practices Act (FCPA) is an anti-corruption law aimed at American companies that operate in international markets. When it was passed in 1977, the FCPA was the first law to make both individuals and corporations civilly and criminally liable for corruption crimes committed outside of the country.

The FCPA prohibits U.S. companies and/or their representatives from bribing a foreign official, political party, or candidate for office in order to drum up business, secure an advantage, or strengthen a business relationship. The anti-bribery provisions apply to three categories of individual or entity:

• Issuers, such as companies that are listed on American stock exchanges or required to file reports with the Securities Exchange Commission (SEC). These entities are required to maintain complete and accurate records and ensure that transactions are executed in accordance with the law.
• Domestic concerns, meaning American companies, their representatives, and companies that are organized under U.S. laws and/or have their principal place of business in the U.S.
• Those under “territorial jurisdiction,” which are typically foreign individuals and businesses operating in the U.S.

The one exception to the “no incentive” rule is facilitation payments, which are made to foreign officials to enable or expedite routine governmental action. If such payments are not properly recorded, however, it may violate the FCPA accounting provisions.

Penalties for violating the FCPA depend on whether the accused is a person or company, as well as which provision applies. The SEC may initiate a civil enforcement action against issuers and their representatives while the U.S. Department of Justice aggressively investigates and prosecutes criminal actions.

An individual found guilty under the Act’s anti-bribery provisions faces a civil fine of up to $10,000 and/or a criminal penalty of $250,000 and five years in prison. Accounting provision violations are even more severely punished, with civil fines of up to $100,000 and criminal penalties, including a $5 million fine and up to 20 years in prison.  Under the Alternative Fines Act, fines may be increased to twice the gross financial loss or gain resulting from the bribe. Companies found guilty of the same offense may pay a civil penalty of $500,000 and a criminal fine that could be as high as $25 million. They may also be subjected to oversight by an independent third party.

With the SEC and Department of Justice taking a heavy-handed approach to suspected violations, any person or company accused of bribing a foreign official for illegal gain should contact an experienced New York FCPA defense attorney immediately. They will have the experience and global reach to collect and analyze the facts in your case and conduct a multi-jurisdictional defense that gives you your best shot at an acquittal. Julie Rendelman is an experienced criminal defense attorney who represents clients in New York City who offers free consultations. If you are concerned that you may the subject of a criminal investigation related to violation of the FCPA, then contact Ms. Rendelman’s office at 212-951-1232 or visit www.RendelmanLaw.com to learn more.