The Foreign Corrupt Practices Act (15 U.S.C. §§ 78dd-1 et seq.) prohibits U.S. companies, U.S. persons, and foreign companies listed on U.S. exchanges from making corrupt payments to foreign government officials to obtain or retain business. The FCPA is jointly enforced by the DOJ (criminal provisions) and the SEC (civil provisions for issuers). FCPA investigations are among the longest and most expensive federal enforcement matters a company can face—routinely spanning multiple countries and years.
Investigations typically commence when: a company's internal compliance function identifies suspicious payments or entertainment expenses during an internal audit; a whistleblower files a complaint with the SEC's FCPA unit; a foreign government investigation surfaces and the DOJ initiates its own inquiry; or a former employee or business partner reports conduct.
| Provision | Prohibition | Penalty |
|---|---|---|
| Anti-Bribery (Criminal) | Corrupt payments to foreign officials, parties, or candidates to obtain/retain business | Individuals: 5 yrs + $250K; Corps: $2M/violation |
| Anti-Bribery (Civil) | Same conduct for issuers | Disgorgement + 2× pecuniary gain |
| Books and Records | False/misleading books; inadequate internal accounting controls | Civil: $10K; Criminal: up to $5M |
| Voluntary Disclosure | Proactive self-disclosure + cooperation + remediation | Up to 50% reduction; potential NPA/DPA |
Early engagement with defense counsel who understands the DOJ's Corporate Enforcement Policy is critical to preserving the benefits of voluntary disclosure. The decision whether to self-disclose—and how to structure that disclosure—has profound implications for the ultimate resolution.
Early legal intervention can significantly impact the outcome of a federal investigation or prosecution.
Mansoor Broachwala, Esq. — Licensed in Illinois since 2017
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