Today is Valentine’s Day – a day often associated with flowers.
Many discussions regarding bribery are vague (and compliance a challenge) because the “b” word (bribery) can mean different things in different contexts.
Indeed, many Foreign Corrupt Practices Act enforcement actions concern things of value such as jobs and internships, sport tickets, food and beverage, leisure activities, etc. that are normal and legal in most circumstances.
Yet providing such things of value to a specific type of person (an individual the DOJ/SEC deem to be a “foreign official”) may expose a company or individual to the “b” word.
And this includes flowers.
In an FCPA enforcement action against telecommunications company Veraz Networks, the SEC alleged in summary fashion:
“This matter involves violations of the books and records and internal controls provisions of the Foreign Corrupt Practices Act(“FCPA”) by Veraz Networks, Inc. a San Jose, California-based telecommunications company. From 2007 to 2008, Veraz resellers, consultants, and employees made and offered payments to employees of government-controlled telecommunications companies in China and Vietnam with the purpose and effect of improperly influencing these foreign officials to award or continue to do business with Veraz.”
Among the SEC’s allegations were the following:
“Veraz also approved of and reimbursed its employee for questionable expenses related to Telecommunications Company 2 [a telecommunications company controlled by the government of Vietnam] including gifts and entertainment for Telecommunications Company 2 employees and flowers for the wife of the CEO of Telecommunications Company 2.”
Was this the only allegation in the SEC’s enforcement action?
Of course not.
Yet, there are one of two ways to view the above allegation.
Was the SEC enforcement attorney who drafted the complaint practicing his/her typing skills or was the allegation included in the complaint to send a message to other companies as to the type of conduct that could be actionable under the FCPA and thus should be on the compliance radar screen.
I got my answer. What is yours?
Happy Valentine’s Day and be careful who you provide flowers to … the U.S government may term it “bribery.”
