Foreign Corrupt Practices Act Defense Lawyer
The Foreign Corrupt Practices Act (FCPA) is a federal anti-bribery law that prohibits individuals and companies from bribing foreign government officials in order to obtain or retain business advantages. The law is primarily codified under 15 U.S.C. § 78dd-1 and related provisions.
Originally enacted in 1977, the FCPA was designed to prevent corruption in international business transactions involving U.S. companies and individuals.
Over the past several decades, enforcement of the FCPA has expanded significantly, and federal authorities now pursue aggressive investigations against corporations and individuals suspected of violating the statute.
Under the Foreign Corrupt Practices Act (FCPA), a mistake made by a regional manager in another country can have repercussions all the way up to the boardroom.
For diplomatic staff, trade representatives, government-adjacent consultants, and anyone acting on behalf of a foreign government, whether in an official or unofficial capacity, with any U.S. jurisdictional touchpoint, the enforcement landscape has fundamentally changed.
If you are under investigation for a potential FCPA violation, the consequences can be severe. A conviction may result in substantial financial penalties, prison time, and lasting damage to both personal and corporate reputations.
An experienced federal criminal defense lawyer can help protect your rights and develop a defense strategy against these allegations.
For the best chance at a positive outcome, consider reaching out to an experienced California federal criminal defense attorney at Eisner Gorin LLP. We're here to help—call us at (818) 781-1570 or use this link to schedule your consultation.
What Is the Foreign Corrupt Practices Act?
The Foreign Corrupt Practices Act is a federal statute that prohibits the payment of bribes to foreign officials for the purpose of gaining business advantages.
The law applies to payments or offers of money, gifts, travel, services, or anything of value intended to influence foreign officials in their official duties.
A typical example of an FCPA violation involves a company executive offering payments or benefits to a foreign government official in exchange for:
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government contracts
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favorable regulatory decisions
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tax advantages
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licensing approvals
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business opportunities
In addition to anti-bribery provisions, the FCPA also contains accounting and record-keeping requirements designed to prevent companies from concealing improper payments.
Who Can Be Prosecuted Under the FCPA?
The Foreign Corrupt Practices Act has broad jurisdiction and applies to several categories of individuals and businesses.
Entities that may be prosecuted under the FCPA include:
U.S. Citizens and Residents
Any U.S. citizen or resident who engages in bribery of foreign officials may be prosecuted under the FCPA regardless of where the conduct occurs.
U.S. Companies and Corporations
Companies incorporated in the United States or whose securities are traded on U.S. exchanges must comply with the FCPA.
Foreign Companies Operating in the United States
Foreign corporations may also be prosecuted if they participate in corrupt transactions that involve U.S. territory, financial systems, or communications networks.
Corporate Employees and Agents
Individual liability can extend to:
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executives
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managers
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directors
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employees
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agents
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consultants
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third-party intermediaries
Even individuals acting under a corporation's direction may face personal criminal liability.
What Is Considered a Bribe Under the FCPA?
Under the Foreign Corrupt Practices Act, a bribe is broadly defined as providing anything of value to a foreign government official to influence their official actions.
Examples of prohibited payments may include:
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cash payments
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gifts or luxury items
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travel expenses
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entertainment
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consulting fees
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charitable donations tied to government decisions
These payments are illegal when made with the intent of influencing a government official's decision in order to obtain or retain business advantages.
Facilitating Payments Exception
The FCPA contains a limited exception for facilitating payments, sometimes called “grease payments.”
These payments are small amounts provided to low-level government employees to expedite routine administrative actions.
Examples may include payments made to speed up:
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processing permits
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issuing licenses
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scheduling inspections
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providing routine governmental services
However, this exception is extremely narrow. Payments intended to influence discretionary decisions or secure favorable contracts are not protected by this exception.
Accounting and Record-Keeping Requirements
The FCPA also imposes strict accounting requirements on publicly traded companies in the United States.
These companies must maintain:
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accurate financial records
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transparent accounting practices
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internal controls designed to prevent corruption
Companies cannot disguise bribe payments by recording them as legitimate business expenses.
Failure to maintain proper accounting controls can lead to both civil and criminal liability.
Federal Agencies That Enforce the FCPA
FCPA investigations are typically handled by two federal agencies:
Department of Justice (DOJ)
The DOJ is responsible for criminal enforcement of the FCPA and prosecutes individuals and corporations involved in bribery schemes.
Securities and Exchange Commission (SEC)
The SEC enforces the civil provisions of the FCPA, particularly those involving accounting and disclosure requirements for publicly traded companies.
These agencies frequently work together in complex international investigations.
Penalties for Violating the Foreign Corrupt Practices Act
FCPA violations carry significant criminal and civil penalties.
Criminal Penalties for Individuals
Individuals convicted of violating the anti-bribery provisions may face:
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up to 5 years in federal prison per violation
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fines up to $250,000 or twice the financial gain obtained from the violation
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additional civil penalties
Criminal Penalties for Corporations
Corporations may face fines reaching millions of dollars and may be required to implement compliance monitoring programs.
Accounting Violations
Violations of the FCPA's accounting provisions may result in penalties of:
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up to 20 years in federal prison
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substantial criminal fines
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civil enforcement actions by the SEC
Because federal sentencing guidelines may apply, actual penalties can be significantly higher depending on the facts of the case.
Deferred Prosecution and Non-Prosecution Agreements
Many FCPA cases involving corporations are resolved through settlement agreements with the government.
These agreements may include:
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Deferred Prosecution Agreements (DPAs)
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Non-Prosecution Agreements (NPAs)
Under these arrangements, companies may admit wrongdoing, pay fines, and agree to compliance reforms in exchange for avoiding criminal prosecution.
Common Defenses to FCPA Charges
Defending against FCPA allegations requires a detailed analysis of the financial transactions and business practices involved.
Some common legal defenses include the following.
Facilitating Payment Exception
A defendant may argue that the payment was a permissible facilitating payment intended to expedite routine government actions.
Bona Fide Business Expenses
Payments for travel, lodging, or marketing activities for foreign officials may be lawful if they are legitimate business expenses rather than bribes.
Lack of Corrupt Intent
The government must prove that the defendant acted with corrupt intent to influence a foreign official. If this intent cannot be established, the charges may fail.
Insufficient Evidence
Complex financial investigations often rely on corporate records, emails, and international financial transactions. A defense attorney may challenge whether the government has sufficient evidence.
Frequently Asked Questions
What is the Foreign Corrupt Practices Act?
The Foreign Corrupt Practices Act is a federal law that prohibits individuals and companies from bribing foreign government officials to obtain or retain business advantages.
The Foreign Agents Registration Act (FARA) involves extensive documentation. The government frequently bases its case on emails, invoices, consulting agreements, encrypted messages, travel logs, and public statements. Developing defenses under FARA can often be complex.
Who enforces the FCPA?
The Department of Justice enforces the criminal provisions of the FCPA, while the Securities and Exchange Commission enforces civil violations involving accounting practices.
Can individuals be prosecuted under the FCPA?
Yes. Corporate executives, employees, agents, and consultants may all face personal criminal liability for FCPA violations.
What is a facilitating payment?
A facilitating payment is a small payment made to a low-level government employee to expedite routine administrative actions. However, this exception is narrowly interpreted.
Can companies settle FCPA investigations?
Yes. Many corporate cases are resolved through deferred prosecution agreements or non-prosecution agreements with federal authorities.
Why You Need an Experienced FCPA Defense Lawyer
Foreign Corrupt Practices Act investigations often involve international financial transactions, complex corporate records, and cooperation between multiple government agencies.
An experienced federal defense attorney can:
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analyze corporate records and financial transactions
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challenge government evidence
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protect clients during investigations and interviews
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negotiate with federal prosecutors before charges are filed
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develop a strategic defense for trial if necessary
Early legal intervention may allow defense attorneys to negotiate favorable resolutions before formal charges are filed.
Eisner Gorin LLP is ready to assist you. Book your consultation by calling (818) 781-1570 or filling out the contact form. Our law firm is located in Los Angeles.