The Foreign Corrupt Practices Act (FCPA) prohibits both United States and foreign corporations and nationals from offering or paying, or authorizing the offer or payment, of anything of value to a foreign government official, foreign political party, party official, or candidate for foreign public office, or to an official of a public international organization in order to obtain or retain business. In addition, the FCPA requires publicly-held United States companies to make and keep books and records which, in reasonable detail, accurately reflect the disposition of company assets and to devise and maintain a system of internal accounting controls sufficient to reasonably assure that transactions are authorized, recorded accurately, and periodically reviewed.
The investigation and prosecution of FCPA violations produces multifarious issues of enforcement, jurisdiction and statutory construction. Often, parts of the investigation involve interviewing witnesses in foreign countries concerning their activities. Also, accounts maintained in United States banks and subject to subpoena may be directly or beneficially owned by senior foreign government officials.
Because of the scope and depth of these investigations, the Department of Justice coordinates such investigations and prosecutions with the United States Securities and Exchange Commission (SEC) and other interested agencies. The SEC has authority to obtain civil injunctions against future violations of the record keeping and antibribery provisions of the FCPA by issuers. See 15 U.S.C. § 78u.
Doing business overseas does not eliminate the reach of the U.S. government. An effective compliance and reporting program is necessary for any company doing business outside of the United States. Also, once an FCPA issue arises, it is important to immediately engage experienced counsel to meet the challenge.