Regulatory: Investigating potential bribery means looking beyond the FCPA

An increasing number of countries show interest in anti-bribery enforcement

Compliance professionals, internal counsel and external counsel face a daunting and increasingly complex landscape when they hear the initial report of potential corruption stemming from their international operations. More recently, this has become the case irrespective both of the location of the potential misconduct and whether it appears on first view to reflect a regulatory or potential criminal issue. The initial decision-making which once might only have contemplated the potential oversight of a very small number of regulatory or enforcement authorities must now include an array of interested parties that can bridge government regulatory, enforcement and criminal bodies located in multiple nations and on multiple continents. This obligatory and expansive thinking is tested as well by the dramatic improvement in cross-border investigative and enforcement cooperation. The Foreign Corrupt Practices Act (FCPA) and anti-bribery space is an excellent place to review this new world order.

A quick survey of senior compliance officers and internal and external counsel results in a quite uniform acknowledgment of the way things have changed. In the anti-bribery environment, until quite recently, the potential regulatory and enforcement concerns that presented when issues developed in multi-national operations were quite narrow, and they informed the internal reviews and investigations accordingly. Without putting too fine a spin on the matter, the discussion of the potential consequences faced by a company with potential anti-bribery exposure was fundamentally U.S.-centric. The dispositive question was often whether or not the potential misconduct was likely to fall under the umbrella of FCPA enforcement. Would U.S. authorities be interested in pursuing this matter? Would they find out about this matter? There were not many other concerns that mattered. Whether the site of the potential misconduct was in the European, Asian, South American or African sector, the substantial likelihood was that home authorities would have little interest in the matter, and even if they did it was likely an interest that would often frustrate and impede efforts by the Department of Justice or the Securities and Exchange Commission to investigate the matter. Cooperative enforcement was unlikely. This has changed.

The new anti-bribery landscape is maturing and it is populated by an increasing number of countries, with anti-bribery laws, that show an interest in oversight and enforcement. To be sure, many nations’ anti-bribery laws have little or no enforcement history and there often is limited executive interest, for obvious reasons, in promoting aggressive anti-bribery investigations. However, this cannot absolve compliance and legal professionals of the responsibility to consider the laws of all relevant jurisdictions when contemplating how to approach an internal review or scope an investigation.  

As compliance professionals increasingly think about how to adjust and fine tune their compliance programs to meet differing anti-bribery laws in their diverse theatres of operation, they must also now work routinely with internal and external counsel to consider the multi-jurisdictional impact of potential misconduct.There are 40 signatories to the Organisation for Economic Co-operation and Development (OECD) Anti-Bribery Convention, including 34 member countries and six others. These include Russia, China and the vast majority of nations with substantial populations and economic growth opportunities. Under the OECD, each nation’s anti-bribery laws are subject to several stages of peer vetting, which include review of enforcement efforts. The trend is for more enforcement by more nations with laws that will meet certain established base-line anti-bribery criteria. In this environment, it is essential that companies consider their potential exposure under all relevant laws.

For companies that learn of a potential international corruption issue, the impact of this emerging global enforcement market means that the headache associated with scoping an internal investigation is now a migraine with diverse and complex symptoms. Companies investigating potential bribery have always faced the question of how, if at all, they plan to disclose any subsequent findings to government authorities. Now, initial assessments of investigative plans in anti-bribery matters must consider a broader array of potentially interested enforcement authorities. Companies must design their anti-bribery investigations at the outset to consider not only the FCPA enforcement regime in the U.S., but also a newly energized U.K. anti-bribery law, along with a growing list of ant-bribery measures in almost all of the important jurisdictions with business growth opportunities.

Contributing Author

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Robertson Park

Rob Park is a partner in Murphy & McGonigle’s Washington, DC office.  Mr. Park spent 20 years in the Fraud Section of the Criminal Division...

Additional Contributors: Timothy P. Peterson

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