Earlier this week, various Democratic Senators introduced a bill titled “The FCPA Reinforcement Act” seeking to extend the statute of limitations to ten years – for a limited time period – for certain FCPA offenses. (See here for the prior post).
This post contains additional thoughts on the bill.
First, statute of limitations are a bedrock, black-letter legal principle. As stated by a unanimous Supreme Court: “Statute of limitations are intended to ‘promote justice by preventing surprises through the revival of claims that have been allowed to slumber until evidence has been lost, memories have faded, and witnesses have disappeared. They provide ‘security and stability to human affairs. [They] are ‘vital to the welfare of society [and] ‘even wrongdoers are entitled to assume that their sins may be forgotten.’”
There are six types of FCPA offenses.
- A criminal violation of the FCPA’s anti-bribery provisions;
- A criminal violation of the FCPA’s books and records provisions;
- A criminal violation of the FCPA’s internal controls provisions; and
- As to issuers, civil violations of those same three provisions.
Whether by design or oversight, the “The FCPA Reinforcement Act” only seeks to extend the statute of limitations for criminal violations of the FCPA’s anti-bribery provisions.
As a practical matter, in many FCPA enforcement actions (both corporate and individual) the statute of limitations period is longer than five years given various other legal avenues the DOJ may pursue.
As stated in the FCPA Resource Guide published by the DOJ/SEC.
“In cases involving FCPA conspiracies, the government may be able to reach conduct occurring before the general limitations period applicable to conspiracies under 18 U.S.C. § 371. For conspiracy offenses, the government generally need prove only that one act in furtherance of the conspiracy occurred during the limitations period, thus enabling the government to prosecute bribes paid or accounting violations occurring more than five or six years, respectively, prior to the filing of
formal charges.There are at least two ways in which the applicable limitations period is commonly extended. First, companies or individuals cooperating with DOJ may enter into a tolling agreement that voluntarily extends the limitations period. Companies and individuals may choose to do this so that they may have additional time to do their own investigation of the conduct, as well as to give them an opportunity to meet with the government to discuss the case and attempt to reach a negotiated resolution. Second, under 18 U.S.C. § 3292, the government may seek a court order suspending the statute of limitations period in a criminal case for up to three years in order to obtain evidence from foreign countries. Generally, the suspension period begins when the official request is made by the U.S. government to the foreign authority and ends on the earlier of the date on which the foreign authority takes final action on the request, or three years.”
The FCPA Reinforcement Act only seeks to extend the statute of limitations – as to certain FCPA offenses – for a relatively brief period of time. The bill contains the following “sunset” provision.
“This Act is effective beginning on the date of enactment of this Act and ending on the date that is 8 years after that date.”
In sum, The FCPA Reinforcement Act is interesting to say the least.
The chance of it becoming law are near zero.
