Previous posts here and here discussed House and Senate versions of the “Countering Russian and Other Overseas Kleptocracy Act” (“CROOK Act”). This previous post discussed the Gabriella Miller Kids First Research Act 2.0 (a bill that seeks to transfer pharma FCPA civil settlement amounts to a fund focused on pediatric disease research).
With a new Congress in session, both bills were re-introduced, yet my response is the same: neither bill will do much of anything to reduce bribery or corruption.
As highlighted in this release, Congressmen Brian Fitzpatrick (R-PA) and Bill Keating (D-MA) recently introduced H.R. 402, the Countering Russian and Other Overseas Kleptocracy (CROOK) Act. As stated in the release, “The CROOK Act would establish an anti-corruption action fund to support international anti-corruption efforts, especially during historic windows of opportunity for reform in foreign countries.”
As highlighted in this release, over in the Senate Senator Ben Cardin (D-Md.) and Senator Roger Wicker (R-Miss.) introduced S.158, the Countering Russian and Other Overseas Kleptocracy Act, or CROOK Act. As stated in the release, the bill “would establish an anti-corruption action fund to provide extra funding during historic windows of opportunity for reform in foreign countries and streamline work strengthening the rule of law abroad.
Like prior versions of the bills, the CROOK Act seek to authorize the Secretary of State to establish a fund to be known as the “Anti-Corruption Action Fund” to aid foreign states to prevent and fight public corruption and develop rule of law based governance structures, including accountable investigative, prosecutorial, and judicial bodies, and supplement existing foreign assistance and diplomacy with respect to such efforts.”
The House version of the CROOK ACT seeks “an amount equal to five percent of each civil and criminal fine and penalty imposed pursuant to actions brought under the FCPA … that would otherwise be deposited in the Treasury of the United States” to fund the Anti-Corruption Action Fund.”
The Senate version of the CROOK ACT seeks to tax certain FCPA enforcement actions (those in which total criminal fines and penalties are in excess of $50 million) by imposing an “additional prevention payment equal to $5 million which shall be deposited in the Anti-Corruption Action Fund.”
Similar to when the bills were first introduced, the bills continue to demonstrate a lack of understanding of why most FCPA enforcement actions actually happen. As highlighted numerous times on these pages, a substantial root cause of many FCPA enforcement action (i.e. pressure that United States businesses face to pay bribes overseas) is foreign trade barriers, distortions and other conditions of doing business in a foreign country.” Sending U.S. money to foreign governmental and nongovernmental parties will do little to address these root causes.
Gabriella Miller Kids First Research Act 2.0
As highlighted in this release, Congresswoman Jennifer Wexton (D-VA) recently re-introduced the Gabriella Miller Kids First Research Act 2.0. The legislation would provide a new source of funding for the National Institutes of Health’s (NIH) Gabriella Miller Kids First Pediatric Research Program (Kids First) by redirecting penalties collected from pharmaceutical, cosmetic, supplement, and medical device companies that break the law. Representatives Tom Cole (R-OK), Peter Welch (D-VT), and Gus Bilirakis (R-FL) joined Wexton in introducing the legislation.
The bill, like the previously introduced version, seeks to add funding to the Kids First program by amending the FCPA (the 78dd-1 portion) by transferring “civil monetary sanctions, including penalties, disgorgement, and interest” recovered under the FCPA’s anti-bribery provisions from pharmaceutical companies (generaly speaking) to the 10-Year Pediatric Research Initiative Fund.”
Childhood cancer and other rare pediatric diseases are heartbreaking.
But should certain FCPA settlement amounts fund pediatric disease research?
Strategies For Minimizing Risk Under The FCPA
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