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Core FCPA Beliefs


If you are reading this, you obviously have an interest in the Foreign Corrupt Practices Act.

But have you ever examined what your core FCPA beliefs are? Core beliefs are not looking at a topic through the lens of a client issue, not contemplating how the DOJ/SEC would view your core belief, and not having a belief because you think it is the “right” answer as judged by others.

From time to time, it is useful to examine and contemplate your core beliefs – whether in your personal life or in this case a topic that is the focus of your professional life.

I often wonder whether certain Foreign Corrupt Practice Act commentators have any core beliefs (and are willing to publicly articulate those core beliefs) or whether commentators take positions simply based on who is paying their paycheck. (See here and here).

From my perspective (and this includes running searches for FCPA content every day, every month, every year for over a decade), there are many opinions in the FCPA space, but less genuine beliefs and even less accountability for false or misleading information, opinions lacking legal grounding, or opinions devoid of historical context.

Thus, I thought it would be a useful exercise to articulate my core FCPA beliefs and I encourage all to hold me accountable to these beliefs in the future.

My core FCPA beliefs are as follows.

  • The FCPA is a fundamentally sound statute, albeit one that could be improved upon.
  • Just because the FCPA is a fundamentally sound statute, does not mean that FCPA enforcement is always fundamentally sound. For instance, might certain FCPA enforcement theories represent a net negative in terms of overall human welfare?
  • Actual legal authority defines what the FCPA means, not non-legal sources of information such as enforcement agency guidance or enforcement actions resolved in the absence of judicial scrutiny. Nevertheless, from a compliance standpoint non-legal sources of FCPA information are important and therein lies the tension.
  • In a legal system based on the rule of law, success is best measured when an enforcement agency is put to its burden of proof in the context of an adversarial system, not when an enforcement agency exercises its leverage to secure settlements against risk-averse business organizations through resolution vehicles not subjected to any meaningful judicial scrutiny.
  • If there was more judicial scrutiny of FCPA enforcement theories, the legal landscape that business organizations find themselves subject to would look different. Thus, risk averse business organizations are, at least in part, responsible for the current FCPA landscape.
  • In a legal system based on the rule of law, transparency and consistency are important, yet often lacking in many aspects of FCPA enforcement.
  • Prosecuting individuals for FCPA offenses achieves greater deterrence than corporate-only enforcement, nevertheless most corporate FCPA enforcement actions lack any related individual charges.
  • Trade barriers and distortions are often the root causes of bribery and a reduction in bribery will not be achieved without a reduction in trade barriers and distortions. In other words, ad hoc enforcement of the FCPA is going to accomplish little without a reduction in trade barriers and distortions that often serve as the root cause of scrutiny and enforcement.
  • The U.S. crusade against bribery suffers from several uncomfortable truths, including a double standard regarding corporate interaction with “foreign officials” under the FCPA and corporate interaction with U.S. officials under other U.S. laws.

What are your core FCPA beliefs? The invite is open for a guest post.

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