The Foreign Corrupt Practices Act has always been a law much broader than its name suggests.
Sure, the FCPA contains anti-bribery provisions which concern foreign bribery.
Sure, the FCPA’s books and records and internal controls provisions can be implicated in foreign bribery schemes.
However, the fact remains that most FCPA enforcement actions (that is enforcement actions that charge or find violations of the FCPA’s books and records and internal controls provisions) have nothing to do with foreign bribery and these provisions are among the most generic legal provisions one can possibly find.
As discussed in this prior post, in May 2023 a federal jury in Chicago found four former Commonwealth Edison (“ComEd”) executives and associates guilty on all counts charged, including conspiring to influence and reward the former Speaker of the Illinois House of Representatives in order to assist with the passage of legislation favorable to the electric utility company, in addition to multiple bribery and record falsification charges. (See here for the DOJ release).
Bribery of a state politician is not ordinarily the type of conduct that results in Foreign Corrupt Practices Act issues.
However, ComEd (a majority-owned indirect subsidiary of Exelon Corp) was an issuer (as was Exelon) and the FCPA has always been a law much broader than its name suggests because of the FCPA’s books and records and internal controls provisions.
Indeed, the most serious (from a sentencing and fine perspective) criminal charges the four individuals were found guilty of were record falsification in violation of the FCPA.
Enter President Trump’s recent Executive Order Titled “Pausing Foreign Corrupt Practices Act Enforcement to Further American Economic and National Security” and a few days prior to this Attorney General Pam Bondi’s memo titled “Total Elimination of Cartels and Transnational Criminal Organizations” which directed the DOJ’s FCPA Unit to “prioritize investigations related to foreign bribery that facilitates the criminal operations of Cartels and TCOs, and shift focus away from investigations and cases that do not involve such a connection.”
It is fairly obvious that both the Executive Order and Bondi memo concern the FCPA’s anti-bribery provisions, but technically neither the Executive Order nor the Bondi memo specifically state this – rather the reference is generally to the “Foreign Corrupt Practices Act.”
Lawyers being lawyers with a duty to advocate for the client are not surprisingly using the Executive Order and Bondi memo to best position their clients.
In a filing earlier this week, the ComEd defendants are seeking a motion to stay all proceedings.
The motion states:
“On February 10, 2025, President Trump promulgated Executive Order 14209 (the “Order”) … which narrows the Attorney General’s enforcement priorities with respect to the Foreign Corrupt Practices Act. Entitled Pausing Foreign Corrupt Practices Act Enforcement to Further American Economic and National Security, the Order states the FCPA “has been systematically, and to a steadily increasing degree, stretched beyond proper bounds[.]” Pursuant to the Order, the Attorney General must “review in detail all existing FCPA investigations or enforcement actions and take appropriate action with respect to such matters to restore proper bounds on FCPA enforcement[.]” The Order further states that, after the Attorney General issues revised guidelines or policies governing investigations and enforcement actions under the FCPA, “FCPA investigations and enforcement actions initiated or continued . . . must be specifically authorized by the Attorney General.”
The Order applies to this case. The FCPA counts asserted against Defendants in this case constitute an “existing FCPA . . . enforcement action” subject to the Order, as no final judgment in the case has yet issued, and the convictions on the FCPA counts are subject to Defendants’ pending Joint Motion for Reconsideration.
To conserve judicial and party resources, Defendants respectfully request this Court stay proceedings in this case and defer its ruling on the pending Motion for Reconsideration until the Attorney General issues the revised guidelines or policies required by the Order, and decides whether it will “specifically authorize” the Government to continue prosecuting the FCPA counts in this case.
[…]
The interests of judicial economy warrant staying all proceedings in this case until the Attorney General issues the revised guidelines or policies required by the Order and decides whether to specifically authorize the Government to continue prosecuting the FCPA counts alleged in the Indictment. The Attorney General’s mandated review of “all existing FCPA investigations or enforcement actions,” its mandated issuance of “updated guidelines or policies,” and its determination of whether to “specifically
authorize[]”continuing this enforcement action after such updated guidelines or policies are issued,
will have a direct bearing on how this case proceeds with respect to any remaining FCPA counts. There is a substantial risk that judicial resources will be wasted, and that Defendants will be subjected to needless criminal prosecution, if a stay is not entered and the Attorney General later declines to continue prosecuting the FCPA counts in light of its updated guidelines or policies.There is reason to think the Attorney General’s updated guidelines or policies will not prioritize enforcing the FCPA counts in this case, which are predicated on the statute’s books-and records provisions rather than on any allegation of foreign bribery. Five days before President Trump promulgated the Order, the Office of the Attorney General issued a memorandum declaring that “[t]he Criminal Division’s Foreign Corrupt Practices Act Unit shall prioritize investigations related to foreign bribery that facilitates the criminal operations of Cartels and TCOs [Transnational Criminal Organizations], and shift focus away from investigations and cases that do not involve such a connection.” The memorandum indicates that “bribery of foreign officials to facilitate human smuggling and the trafficking of narcotics and firearms” are examples of the types of cases that will be prioritized under the new administration’s leadership. The FCPA charges brought against Defendants in this case do not implicate the bribery of foreign officials to facilitate human smuggling nor the trafficking of narcotics and firearms, so they fall outside the categories that the Attorney General has directed prosecutors to prioritize.
The balance of relative hardships and benefits between the parties here weighs heavily in favor of granting a stay. If the Attorney General determines that the FCPA charges in this case should not proceed, any expenditure of effort by the Court and the parties to address those counts will be wasted. As to the parties, Defendants should not be required to expend additional resources to defend against the FCPA counts while the Attorney General considers whether those counts should proceed at all. The Government, by contrast, will suffer no hardship if a stay is imposed. There can be no public interest in continuing proceedings that the Government has not made a final determination that it will pursue.
For the foregoing reasons, Defendants respectfully request a stay of all proceedings in this matter, including resolution of the pending Motion for Reconsideration, until the Attorney General issues the revised guidelines or policies required by the Order and decides whether to specifically authorize the Government to continue prosecuting the FCPA counts alleged in the indictment.”
To sum up, the criminal enforcement action against the ComEd defendants has nothing to do with foreign bribery. However, the defendants were convicted of FCPA books and records and violations.
The Trump Executive Order and Bondi Memo rather obviously concern the FCPA’s anti-bribery provisions. However, neither the Executive Order nor the Bondi memo specifically states this – rather the reference is generally to the “Foreign Corrupt Practices Act.”
A further reminder that the FCPA has always been a law much broader than its name suggests.
