In 1988, the FCPA’s books and records and internal controls provisions were amended to include a de facto “good faith” compliance defense in certain situations involving issuers. (See 15 USC 78m(b)(6) – so-called Section 13(b)(6) of the ’34 Act). Since then, Section 13(b)(6) has seemed to be relevant to several Foreign Corrupt Practices Act enforcement actions, however the enforcement actions were silent on this important statutory provision.
The recent Eni enforcement action (see here and here for prior posts) is believed to be the first FCPA enforcement to meaningfully address Section 13(b)(6). In this regard, wow – the SEC actually acknowledged that Section 13(b)(6) exists after completely ignoring this relevant statutory provision in several prior relevant enforcement actions. But did the SEC get it right?