Not long ago, it was common for smart-alecky lawyers at FCPA conferences to make a big deal about “anything of value” not being defined in the FCPA (as in, the FCPA prohibits “the payment, gift, offer, or promise of anything of value”) and there being no de minimis threshold for bribes. “So watch out,” the lawyers would say, “because that means something as cheap as a cup of coffee or taxi fare can literally violate the FCPA.”
The DOJ and SEC grew so tired of hearing about offending cups of coffee and taxi fares they included a disclaimer in the FCPA Resource Guide:
[I]t is difficult to envision any scenario in which the provision of cups of coffee, taxi fare, or company promotional items of nominal value would ever evidence corrupt intent, and neither DOJ nor SEC has ever pursued an investigation on the basis of such conduct.
Thankfully, that ended the supposed need for warnings about buying a double expresso for a foreign official before stuffing him into a cab.
And yet, those smart-alecky lawyers had a point, even if they didn’t know it at the time. Because, by a quirk of American jurisprudence, something worth less than a cup of coffee or taxi fare can become an illegal bribe under the FCPA.
How is that possible?
There’s no definition in the FCPA of “anything of value” because Congress didn’t think a definition was needed. Why not? Because Congress had already used identical language in the U.S. domestic bribery statute, also without a de minimus standard. So Congress took the same approach with the FCPA, intending all along to outlaw anything intended to be a bribe.
That’s how the DOJ and SEC see it. Their FCPA Resource Guide says in footnote 86 that courts have interpreted “anything of value” in the domestic bribery statute “to include both tangible and intangible benefits.” (Emphasis in original)
The footnote continues:
See, e.g. . . . United States v. Williams, 705 F.2d 603, 622-23 (2d Cir. 1983) (approving jury instruction that stock could be a “thing of value” if defendant believed it had value, even though the shares had no commercial value, and noting that “[t]he phrase ‘anything of value’ in bribery and related statutes has consistently been given a broad meaning”).
In Williams, the defendant in question was Harrison A. Williams, Jr., former United States Senator from New Jersey. A federal jury convicted him on bribery and related charges arising out of the Abscam undercover sting.
Senator Williams met with FBI agents posing as wealthy Arab sheiks and agreed to become a secret 18 percent stockholder of their titanium mining operation. In return, Williams promised to use his Senate office to help award government contracts to the venture.
On appeal from his conviction, Williams (and his co-defendant, a lawyer who acted as intermediary) argued that anything of value “means something that objectively has actual value.” And since the Arab sheiks and their titanium mining operation were all fake, the stock they offered him was also fake and therefore had no actual value.
Thus, Williams and his co-defendant argued, the trial judge’s instruction to the jury was wrong when he said the stock could be a thing of value “regardless of its actual worth in the commercial world, [if] you find that the defendant believed that the stock had value for himself.”
The Second Circuit said, “We think Judge Pratt correctly construed the statutes to focus on the value that the defendants subjectively attached to the items received.”
When the Senator agreed to take his secret shares, the court said, “he expected these shares to have considerable value.” So the shares constituted a bribe, even though they were objectively worth nothing, which is less than a cup of coffee.
On the same topic, kudos to General Motors.
Its global anti-corruption policy (featured in an FCPA Blog Benchmarking Alert) has a full-throated description of “anything of value” that even includes the concept of subjective value.
Anything of Value: Anything that might have value to the recipient, including cash or cash equivalents (e.g., gift cards), gifts, gratuities, goods, loans, discounts, cars (including loaner, discounted, and “test drive” vehicles), entertainment or tickets, meals or drinks, travel or lodging, charitable contributions, political contributions, training, services, personal favors, paying bills for others, forbearances, offers of employment, hiring someone’s friend or relative, or anything else that is valuable to the receiver, even if it would not be valuable to anyone else.
There it is at the end — “or anything else that is valuable to the receiver, even if it would not be valuable to anyone else” — just as Congress intended.