It is a somewhat common refrain that while corporate executives and companies pressured into paying bribes overseas face prosecution under the FCPA, the foreign officials who solicit, demand, and even extort the bribes go scot-free. As with many refrains, however, the reality is more complex.
Such corrupt officials are often prosecuted locally. Although countries around the world admittedly run the spectrum in terms of how aggressively they enforce such laws, it is universally a crime for domestic officials to solicit or receive bribes. The U.S. government encourages and supports other countries in their efforts to bring such officials to justice.
In furtherance of this effort, the U.S. provides training to its law enforcement partners. The U.S. is also active in a number of international forums (e.g., the OECD’s Working Group on Bribery), and has successfully encouraged other countries to ramp up enforcement efforts. U.S. law enforcement has prioritized the development of working relationships with its foreign counterparts and, where appropriate, coordinates and shares information to enable them to prosecute their corrupt officials. As just one of many examples, look at what Brazil has been doing on this front, both on its own and with the assistance of U.S. law enforcement.
Moreover, the U.S. does not merely serve in a support role. Although Congress, weighing political sensitivities, enacted the FCPA not to include such a mechanism, the U.S. can and has criminally prosecuted foreign officials for violations of other offenses that arise out of the same facts being investigated in the respective FCPA matter (e.g., money laundering, Travel Act violations, wire fraud, and related conspiracies). In fact, of the seven individuals convicted in FCPA-related cases since August 2015, four were government officials.
Through the Kleptocracy Initiative, the U.S. also seizes the assets of corrupt officials and, where appropriate, repatriates these corrupt proceeds. In early 2016, for example, the DOJ filed civil complaints seeking close to a billion dollars in forfeitures related to assets alleged to be those of a corrupt official. Although perhaps less satisfying for some, the U.S. further has the ability to revoke U.S. visas and deny entry to corrupt foreign officials.
So, yes, although plenty of corrupt foreign officials haven’t been prosecuted, the same can be said about many bribe payers (and, frankly, violators of every crime). One might argue that the U.S. government could and should be doing more, but that could be said about almost everything. It cannot be said so simply, however, that bribe-takers are “walking” or that bribe-payers are unfairly singled out. The reality is far more complex and, indeed, cannot be fully covered in this short piece.
For a more thorough discussion of these complexities, please attend Matt’s session with the FBI on this very topic at the FCPA Blog Conference in NYC on October 26.
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Matthew Queler is a principal in the forensics and investigations practice of Deloitte Financial Advisory Services LLP (Deloitte FAS), having most recently served as an Assistant Chief in the DOJ’s FCPA Unit.
Michael Won is a Manager in Deloitte FAS, having recently joined after serving as the Lead Analyst in the FBI’s International Corruption Unit.
2 Comments
Thanks for this informative and thoughtful piece Mike and Matt. The simple fact is, however, that bribe takers are, by and large, walking. When one looks at the number of FCPA cases brought since 2011 and the hundreds of millions of dollars in bribes paid, the fact that fewer than a half dozen "public officials" have been prosecuted during that time speaks volumes. As I have previously maintained in my FCPA Blog post "Sporadic Enforcement Isn't Effective Enforcement," http://bit.ly/20BHVXm with the additional resources being provided to the FCPA Unit and the Criminal Division's Kleptocracy Initiative, perhaps the DOJ would be wise to make a concerted effort to root out persistent pockets of overseas corruption by routinely targeting bribe takers. One-off cases like Vimplecom and the Malaysian forfeiture actions are examples of the potential and should be replicated routinely. Rather than announcing mealy mouthed "initiatives," a firm and public dedication of resources toward this effort by DOJ and the FBI, in my view, could produce the dramatic and fulsome relief that the enactment of the FCPA sought to achieve.
The statement by authors Queler and Won "…it is universally a crime for domestic officials to solicit or receive bribes." is incorrect. You need to look no further than Canada's Criminal Code section 121 (1) (b)and (c). …"unless the person has the consent in writing of the head of the branch of government" (b) (with which the dealings take place) or (c) (that employs them or of which they are an official) . Canada recently had a Senator charged under this section as well as other sections of the criminal code. The somnolent media half heartedly asked "how can the recipient be charged but the person who paid the sum not be charged?" As Queler and Won correctly noted "The reality is far more complex and, indeed, cannot be fully covered in this short piece". It may be instructive to keep an eye on Canada and to view it through a new set of lenses. As to the fate of the charged Senator, he walked.
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