Coalition for Integrity states that it works “in coalition with a wide range of individuals and organizations to combat corruption and promote integrity in the public and private sectors.”
In March, Coalition for Integrity posted a statement on social media regarding President Trump’s Executive Order titled “Pausing Foreign Corrupt Practices Act Enforcement to Further American Economic and National Security.”
Its social media post stated:
Two months ago, I posed several questions for C4I regarding its statement and am still waiting for answers. Here are the questions.“The Coalition for Integrity (“C4I”) believes that the pause in U.S. enforcement of the FCPA hurts rather than helps American global competitiveness and national security. A pause risks, among other things, undermining the competitiveness of U.S. companies in international markets, disincentivizes the enforcement of counterpart laws by other countries, and erodes the anti-corruption leadership position of the United States around the world. Furthermore, U.S. companies will now operate in an emboldened global bribery threat environment – where our competitors and adversaries will likely leverage (and even trumpet) that America’s FCPA enforcement resources have been publicly diverted to other priority areas. The FCPA remains the law of the United States. It applies to and has been enforced against U.S. companies and non-U.S. companies with ties to the United States. American companies for a variety of technical (e.g., applicable statutes of limitation and overseas laws) and practical (contractual and business standard obligations) reasons will have no choice but to maintain anti-bribery compliance programs. Many U.S. companies will continue to sustain strong compliance programs because experience has demonstrated that they are good for business by promoting fairness and a level playing field (helping to reduce fraud and theft, and protect their employees, and are consistent with their corporate values). Business leaders involved with C4I have also seen that the FCPA is a positive U.S. competitive differentiator in global markets. It actually strengthens their companies’ reputations. Foreign officials and regulators are less tempted to solicit bribes when US companies can credibly respond that they are prevented from offering bribes by strongly enforced U.S. laws. This edge can be especially important for smaller US companies with limited resources, and for those larger companies that are engaged in capital-intensive long-term business investments and operations abroad. In addition, bribery adds to the cost of doing business. Active U.S. enforcement also serves to pressure other countries to properly enforce their FCPA-like laws against their own companies. Having a law on the books is not enough. In recent years, pressure from the U.S., the OECD and others have caused a number of countries to step up their enforcement efforts. While more needs to be done in this regard, a step back by the U.S. from FCPA enforcement sends the clear message to other countries that they can do the same. C4I would welcome the opportunity to work with policymakers and business to provide specific actionable suggestions for how the Administration can improve the FCPA to better fight bribery, consistent with U.S. and global interests.”
How does the so-called “pause” hurt U.S. national security when the FCPA statute itself contains a national security exemption?
What is the substantive difference between the so-called “pause” and several other examples in recent years in which the DOJ has not enforced the FCPA or dismissed FCPA matters? (See this post for several examples). Did these “pauses” risk “undermining the competitiveness of U.S. companies in international markets, disincentivize[] the enforcement of counterpart laws by other countries, and erode[] the anti-corruption leadership position of the United States around the world?
For approximately 50 years (since 1977) U.S. companies could respond – when faced with a foreign official attempting to solicit a bribe – “that they are prevented” from doing so by the FCPA. Has this “shield” been successful in reducing the number of FCPA enforcement actions over the FCPA’s nearly five decades? After all, each decade has generally seen more – not less – FCPA enforcement.
What does “strongly enforced” or “active enforcement” mean? Every U.S. company (public or private) and other forms of U.S. business organization are subject to the FCPA. Every foreign company with shares traded on a U.S. exchange (approximately 1,000 in any given year) is subject to the FCPA. And – if the jurisdictional prong of the so-called dd-3 prong of the FCPA’s anti-bribery provisions is met – every company in the world can be subject to the FCPA. This denominator is enormous and potentially massive. Yet, seven is the average number of DOJ corporate FCPA enforcement actions over the last decade. Is this “strong enforcement” or “active enforcement”?
Regarding the assertion: “In recent years, pressure from the U.S., the OECD and others have caused a number of countries to step up their enforcement efforts?” What does “stepping up” enforcement mean? Does it mean creating alternative resolution vehicles to resolve matters? If so, is that not prioritizing quantity of enforcement over quality of enforcement?
Check out the Board of Directors of Coalition for Integrity and ask yourself how many of them benefit from “more” enforcement (regardless of enforcement theory, regardless of resolution vehicle used and regardless of whether the enforcement action is actually solving a problem)? The Board of Directors of Coalition for Integrity includes the self-described “architect and key enforcement official of DOJ’s modern FCPA enforcement program,” and another individual who states that he is “internationally recognized for his leading role in developing and implementing the government’s FCPA enforcement strategy, and … widely credited with developing the current enforcement regime.” Both of these individuals, as well as several others on the Board of Directors, currently have FCPA practices at law firms and seemingly benefit from more – not less – FCPA enforcement.