The Department of Justice has announced that it is setting up meetings with the U.S. Chamber of Commerce to discuss ways the Chamber has in mind for the DOJ to stop enforcing the Foreign Corrupt Practices Act. According to the Chamber, U.S. corporations that form FCPA compliance programs should not be held responsible for their “rogue employees” who offer a bribe or two on foreign soil.
The JD Journal reports that the DOJ is doing the right thing in reevaluating the way it will prosecute future wrong doing under the FCPA. They say that “most of the drag” on our nation’s enormous trillion dollar trade imbalance is caused by the government’s enforcement of the FCPA and the Aliens Tort Claims Act. If corporations from other nations are allowed to cheat and bribe, the argument goes, then we are just hurting ourselves by insisting that the game be played by American businesses overseas the same way it is back on American soil.
The FCPA forbids the bribery of foreign officials by U.S. individuals and companies seeking to curry favor in another country. The Dodd-Frank Act of 2010 put more bite into the FCPA by including a provision that allows an eligible whistleblower to share between ten and thirty percent of any recovery by the government attributable to information received from the whistleblower.
The Chamber’s view is not shared by everyone, of course. According to the Washington Post, it was George W. Bush — hardly the enemy of big business — who stepped up enforcement of the FCPA when he “rightly tagged overseas corruption as an impediment to innovation and free markets.” The Post’s position is that a company should not be able to escape liability for its employees’ actions overseas simply because the company has a compliance program. The DOJ already takes into account a company’s compliance program when determining whether it should be held responsible for an employee’s actions. And DOJ guidelines already specify that a company will not be held criminally liable unless it knows of, directs or contributes to the wrongdoing.
It’s fairly easy to see that the changes sought by the Chamber of Commerce will simply lead to an environment in which all employees caught bribing foreign officials will be “rogue employees.” This might be good in the short run for isolated American businesses, but as observed by the Post, over the long haul, the changes would not serve innovation, free markets or the “ethical conduct of international business.”
Waters & Kraus is a national firm with highly skilled lawyers practicing qui tam and FCPA litigation in four offices, including Dallas, Los Angeles, San Francisco, and Baltimore. Our attorneys have decades of experience successfully representing whistleblowers in a variety of fraud cases. Contact us or call our attorneys at 800.226.9880 to learn more about our practice and how we can assist.
