Page 22 - U.S. FOREIGN CORRUPT PRACTICES ACT

A Resource Guide to the U.S. Foreign Corrupt Practices Act. Second Edition.

85
knew that his conduct violated the FCPA. To be in deciding which cases promote law enforcement
guilty, a defendant must act with a bad purpose, i.e., priorities and justify investigation. Certain patterns,
know generally that his conduct is unlawful. however, have emerged: DOJ’s and SEC’s anti-
bribery enforcement actions have focused on small
What Does “Anything of Value” payments and gifts only when they comprise part of

Mean? a systemic or long-standing course of conduct that
In enacting the FCPA, Congress recognized evidences a scheme to corruptly pay foreign officials
that bribes can come in many shapes and sizes—a to obtain or retain business. These assessments are

86
broad range of unfair benefits —and so the statute necessarily fact specific.
prohibits the corrupt “offer, payment, promise to
pay, or authorization of the payment of any money, Cash
or offer, gift promise to give, or authorization of the The most obvious form of corrupt payment is
87
giving of anything of value to” a foreign official. large amounts of cash. In some instances, companies
An improper benefit can take many forms. have maintained cash funds specifically earmarked

While cases often involve payments of cash for use as bribes. One Brazilian company that
(sometimes in the guise of “consulting fees” or was a stockholder of a U.S. issuer developed and
“commissions” given through intermediaries), operated a secret financial structure that operated
others have involved travel expenses and expensive to make and account for corrupt payments to
gifts. Like the domestic bribery statute, the FCPA foreign officials. Among other methods the

does not contain a minimum threshold amount for company used, it would transfer funds to Brazilian
88
corrupt gifts or payments. Indeed, what might be moneychangers (doleiros) who would withdraw the
considered a modest payment in the United States amounts in cash and deliver them to the officials.
89
could be a larger and much more significant amount In another instance, a four-company joint venture
in a foreign country. used its agent to pay $5 million in bribes to a
90
Regardless of size, for a gift or other payment Nigerian political party. The payments were
to violate the statute, the payor must have corrupt made to the agent in suitcases of cash (typically in
intent—that is, the intent to improperly influence the $1 million installments), and, in one instance,
government official. The corrupt intent requirement the trunk of a car when the cash did not fit into a
91
protects companies that engage in the ordinary suitcase.
and legitimate promotion of their businesses

while targeting conduct that seeks to improperly Gifts, Travel, Entertainment, and Other
induce officials into misusing their positions. Thus, Things of Value
it is difficult to envision any scenario in which the A small gift or token of esteem or gratitude is
provision of cups of coffee, taxi fare, or company often an appropriate way for business people to
promotional items of nominal value would ever display respect for each other. Some hallmarks of
evidence corrupt intent, and neither DOJ nor SEC appropriate gift-giving are when the gift is given

has ever pursued an investigation on the basis of openly and transparently, properly recorded in the
such conduct. Moreover, as in all areas of federal giver’s books and records, provided only to reflect
law enforcement, DOJ and SEC exercise discretion esteem or gratitude, and permitted under local law.

14