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The Many Contradictions In The DOJ’s FCPA Statutory Interpretation Positions

Contradiction

Given the paucity of contested DOJ Foreign Corrupt Practices Act enforcement actions, it is rare for the DOJ to publicly articulate its FCPA statutory interpretation positions.

But when this does occur, the DOJ frequently takes contradictory and inconsistent positions.

Counsel representing defendants in contested FCPA enforcement actions would be wise to analyze this dynamic and this dynamic represents yet another reason why more business organizations and individuals under FCPA scrutiny should put the DOJ to its burden of proof.

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Perhaps The Disclosure Approach Wasn’t Such A Bad Idea After All

Sunrays

This recent Wall Street Journal article titled “If You Solicit Bribes, This Fellow Wants to Punch You In the Face” caught my eye. It details a Thai man, who after years of paying bribes, became fed up with “what passes for business as usual in Bangkok” and launched a “nightly television show where he runs through the various demands for bribes and kickbacks that he says many people here endure.”

Whether this approach is reducing corruption is a debatable point, but it serves as a useful reminder that the FCPA’s current prohibition approach was not the only approach Congress considered in the mid-1970’s when considering the so-called foreign corporate payments problem.

The other approach, consistent with Louis Brandeis famous quote “sunlight is said to be the best of disinfectants,” was a disclosure approach.

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Second Circuit Hears Oral Argument In U.S. v. Hoskins

Judicial Decision

Judicial scrutiny of Foreign Corrupt Practices Act enforcement is rare. Appellate court judicial scrutiny even more rare. Listening to appellate court oral arguments in an FCPA appeal, let’s just say you can count those instances on one hand and have a couple of fingers left over.

Last week the Second Circuit heard oral argument in U.S. v. Hoskins and you can listen to the arguments here.

The issue before the court, as stated in the DOJ’s brief, is as follows.

“Whether a foreign person (who does not reside in the United States) can be liable for conspiring or aiding and abetting a U.S. company to violate the Foreign Corrupt Practices Act if that individual is not in the categories of principal persons covered in the statute.”

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You Gotta Be Kidding Me

Surprise

Reading some Foreign Corrupt Practices Act “commentary” sometimes leaves me scratching my head and thinking to myself “you gotta be kidding me.”

Case in point, Michael Volkov recently wrote in this post on his Corruption, Crime & Compliance blog as follows:

“A lot has been written on the vagueness or lack of clarity surrounding the FCPA. Those opinions are not very persuasive and ignore common sense, legal concepts and good faith. […] Drawing the lines around FCPA behavior is not as hard as many claim. Those that make such baseless claims are only justifying their own existence or engaging in a transparent marketing ploy.”

At the risk of making baseless claims, justifying my own existence or engaging in a transparent marketing ploy, let me share with you a long list of judicial decisions in which federal court judges have found various provisions of the FCPA to be vague or lacking in clarity.

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