The SEC’s apparent industry sweep of film studios in April 2012 raised a lot of eyebrows. While the sweep’s commencement was surprising, it disappeared as quickly as it started. Though no one outside the U.S. government knows exactly what, if anything, the SEC uncovered, this action certainly forced filmmakers to take notice of the FCPA.
In the U.S., the only FCPA case concerning the entertainment industry is the saga of Gerald and Patricia Green, who bribed a Thai official to secure film festival management contracts. The dearth of other film-related FCPA cases, however, does not mean that film has not been exploited beyond its entertainment value.
In Britain, A Landscape of Lies lived up to its name, as the producers created the film in an attempt to cover up tax fraud. Meanwhile, Bollywood elites have created multiple films to launder black money. China – the most prized emerging market for American filmmakers – likewise has not been immune to film-related corruption. A pricy publicity film commissioned by the Ministry of Railways included a sizeable buffer for kickbacks in its budget. And these are just examples from the past year.
Considering the amount of money that can be made (or lost) in the entertainment industry, it’s easy to imagine that films can be hijacked for corrupt purposes. Combining this corruption potential with the FCPA’s oft maligned broad reach, it’s worth examining a common film industry practice that seems perfect for both exploitation and prosecution: political cameos.
Can a brief appearance in a movie serve as an alternative method of bribery? Presumably, if a filmmaker subject to U.S. jurisdiction casts a foreign official in an effort to induce the official to abuse her discretion, then the DOJ could have a field day. But, of course, the likelier scenarios are not so well scripted.
It’s pretty easy to determine whether the FCPA applies to a particular filmmaker and whether the bribe recipient qualifies as a foreign official (or a third party related to the official). But, as we know, for FCPA liability, other elements also have to be met. So how much should filmmakers really worry about political cameos exposing them to FCPA liability? And how much attention should the DOJ pay to this practice? In the next few posts, we’ll examine exactly that.
Ilya Zlatkin is a recent graduate of the University of Richmond School of Law and holds degrees in economics and foreign affairs from the University of Virginia. He is currently awaiting the results of the Illinois bar exam and is in the process of becoming a Certified Fraud Examiner. He can be contacted here.