Government Contracts Blog : Government Contracts Lawyer & Attorney : Sheppard Mullin Law Firm : Bids, Licenses, Awards, Conflict of Interest.

On January 19, 2010, the Department of Justice (“DOJ”) unsealed sixteen indictments charging twenty-two individuals with violations of the Foreign Corrupt Practices Act (“FCPA”), allegedly arising from schemes to bribe foreign government officials. The DOJ also announced that, in connection with the indictments, the FBI had executed fourteen search warrants across the U.S., and the City of London police had executed seven search warrants in the U.K. The product of an FBI sting operation hailed in a DOJ press release as “the largest single investigation and prosecution against individuals in the history of the DOJ’s enforcement of the [FCPA],” the indictments may signal a fundamental shift in the DOJ’s ongoing campaign “to erase foreign bribery from the corporate playbook.”
 

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On July 10, 2009 a federal jury in New York convicted Frederic Bourke, co-founder of handbag maker Dooney & Bourke, of conspiring to violate the Foreign Corrupt Practices Act ("FCPA"). The conviction is significant for the two FCPA enforcement trends it highlights. First, the prosecution of Mr. Bourke demonstrates that both the U.S. Department of Justice and the U.S. Securities and Exchange Commission are focused on investigating and charging individuals for violating the FCPA. In the first half of 2009 alone, the Department of Justice indicted eight people on charges of violating the FCPA, illustrating that no longer will companies alone be the subject of FCPA prosecutions.
 

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Please click here to read about the Foreign Corrupt Practices Act: provisions, penalties, compliance programs and trends.

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The Foreign Corrupt Practices Act (FCPA) is a federal law which prohibits companies from obtaining or directing business through the payment of bribes to foreign governmental officials and political figures. The renewed focus on corporate accountability in recent years has led to a dramatic increase in the number of FCPA enforcement actions -- from 5 in 2004 to 38 in 2007. The attached presentation, utilized in connection with a recent in-house presentation, summarizes the FCPA and why it is imperative that every company doing business in the global marketplace be aware of its provisions and serious penalties, including civil penalties, criminal fines, and imprisonment, in the event of a violation.

Click here to view the presentation.

Presented by:

Bethany Hengsbach

(213) 617-4125

bhengsbach@sheppardmullin.com

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A Dozen Questions to Ask

• Are you an issuer, US person or US entity?
• Have any foreign agents or subsidiaries?
• Are you a foreign person or company whose transactions touch the US?
• Promised or paid anything of value to a foreign official (governmental, political, NGO) for business purposes?
• Did you or a third party know or suspect it would be passed on to a foreign official?
• Have you consciously disregarded circumstances indicating improper payments occured?
• Do you maintain an adequate system of internal controls?
• Was the payment to facilitate a routine governmental action (grease payment) permitted by the foreign country?
• Do your books fairly reflect the transactions and properly characterize expenditures, such as "entertainment?"
• Have you conducted comprehensive due diligence on your foreign business partner?
• Is your industry historically prone to corruption?
• Are you doing business in a country with a "corrupt" environment?

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