Numerous previous post on FCPA Professor have highlighted the double standard between enforcement of the Foreign Corrupt Practices Act and enforcement of 18 U.S.C. 201, the domestic bribery statute.
After all, in many respects the FCPA was modeled after the domestic bribery statute and it has very similar elements to the FCPA’s anti-bribery provisions.
The theme explored in the numerous double standard posts is how business interactions with “foreign officials” seem to be subject to different standards than business interactions with U.S. officials. The issues that arise include the following:
- Why do we reflexively label a “foreign official” who receives “things of value” from private business interests as corrupt, yet generally turn a blind eye when it happens here at home or call it something different such as participation in the political process?
- Is the FCPA enforced too aggressively or is enforcement of the U.S. domestic bribery statute too lax?
- Ought not there be some consistently between enforcement of the FCPA and the domestic bribery statute?
Consider the following.
A billionaire business executive bankrolls a high-ranking politician’s campaign, finances the politician’s legislative agenda, and subsidizes the politician’s “personal finances, as the rising politician and his wife grappled with heavy debt and big swings in their income.”
Or consider the following.
A company supports (and indeed would benefit from) the trade agenda of a high-ranking government official and hosts the official at its company headquarters for a speech. During the visit, the company gives the official a hard to obtain product that the company knows is subjectively valued by the official.
In both scenarios, a prudent FCPA practitioner would immediately see the “red flags;” counsel the companies at issue to conduct an internal investigation as to the conduct at issue and related conduct; and – mindful of the enforcement agencies guidance and cognizant of the carrots and sticks they posses – likely suggest voluntarily disclosure of the investigative findings.
The above high-ranking government officials were not “foreign officials” – they were U.S. government officials.
The first scenario involves Republican Senator and Presidential hopeful Marco Rubio.
According this New York Times article:
“[Billionaire auto dealer Norman Braman] has left few corners of Mr. Rubio’s world untouched. He hired Mr. Rubio, then a Senate candidate, as a lawyer; employed his wife to advise the Braman family’s philanthropic foundation; helped cover the cost of Mr. Rubio’s salary as an instructor at a Miami college; and gave Mr. Rubio access to his private plane.
The money has flowed both ways. Mr. Rubio has steered taxpayer funds to Mr. Braman’s favored causes, successfully pushing for an $80 million state grant to finance a genomics center at a private university and securing $5 million for cancer research at a Miami institute for which Mr. Braman is a major donor.
Even in an era dominated by super-wealthy donors, Mr. Braman stands out, given how integral he has been not only to Mr. Rubio’s political aspirations but also to his personal finances.”
Pressed on his financial ties to Mr. Braman, Mr. Rubio said in an interview that he saw no ethical issue. “What is the conflict?” he asked. “I don’t ever recall Norman Braman ever asking for anything for himself.”
He acknowledged that Mr. Braman had approached him about state aid for projects, such as funding for cancer research, but said that he had supported the proposals on their merits.”
The second scenario involves President Obama.
As highlighted here during Obama’s recent visit to Nike headquarters to promote his trade agenda, the company provided Obama, an avid basketball player and fan, with an exclusive pair of top secret Air Jordan sneakers as well as a pair of specifically designed presidential sneakers in a custom presidential box.
I’d like to think that President Obama has countless reasons to support his trade agenda and is unlikely to be influenced one iota by Nike providing him something of value.
By why then do FCPA enforcement actions simplistically allege that foreign officials (who no doubt have countless reasons to engage in the discretionary acts that underlie the FCPA scrutiny) are influenced by handbags, evenings at Karaoke bars, flowers or even cigarettes? (In case you wondering, those are actual allegations from recent FCPA enforcement actions).
While you ponder the above questions, just remember, in the words of a high-ranking DOJ official:
“We in the United States are in a unique position to spread the gospel of anti-corruption, because there is no country that enforces its anti-bribery laws more vigorously than we do.”