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Khuzami, A Signatory Of The 2012 FCPA Guidance, Calls For Additional FCPA Guidance or “Changing” The “Somewhat Controversial” FCPA

You really can’t make this one up and there is a reason why, unfortunately but justifiably, many view Foreign Corrupt Practice Act enforcement with cynicism.

In 2012, Robert Khuzami was head of the SEC’s Division of Enforcement when the SEC, along with the DOJ, issued FCPA Guidance [1].

The Guidance was signed by two individuals: Khuzami and then Assistant Attorney General Lanny Breuer.

Just above Khuzami’s signature, the Guidance states:

“The Guide is the product of extensive efforts by experts at DOJ and SEC, and has benefited from valuable input from the Departments of Commerce and State.  It endeavors to provide helpful information to enterprises of all shapes and sizes— from small businesses doing their first transactions abroad to multi-national corporations with subsidiaries around the world. […] The Guide is an unprecedented undertaking by DOJ and SEC to provide the public with detailed information about our FCPA enforcement approach and priorities. We are proud of the many lawyers and staff who worked on this project, and hope that it will be a useful reference for companies, individuals, and others interested in our enforcement of the Act.”

At the Guidance press conference (see here [2] for the prior post) Khuzami said that the “real value [of the guidance] is its clarity and transparency.”

Against this backdrop, I nearly fell out of my chair when I read this recent National Law Journal [3] profile of Khuzami. In it, Khuzami is asked: “What changes do you see under the new attorney general, Jeff Sessions?”

[4]

Khuzami responded:

“I think that you may get a [new] look at the Foreign Corrupt Practices Act, the anti-corruption law that is somewhat controversial, mostly due to the potential breadth of the law. There is a view that perhaps the government can do more to assist companies in deciding how they can conduct business in jurisdictions where corruption exists. Companies overwhelmingly aren’t interested in handing out bribes or engaging in corrupt behavior, but typically they find themselves operating in countries where that is the norm or accepted behavior. There’s a way of giving additional guidance or changing the law in a way that might strike a balance.”

In my article “Grading the FCPA Guidance [5]” I stated that “despite the Guidance, much about FCPA enforcement remains opaque” and that “despite the Guidance, FCPA reform remains a viable issue.”

I am glad to see that a signatory of the FCPA Guidance agrees and that “there’s a way of giving additional guidance or changing the law in a way that might strike a balance.”

But then again, I am not surprised because former FCPA enforcement officials frequently articulate seemingly contradictory FCPA commentary upon exiting government service. (See here [6] and here [7] for prior posts).

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