All U.S. companies operating abroad need an "effective" compliance and ethics program1 to prevent, detect and remediate violations of the U.S. Foreign Corrupt Practices Act (FCPA), which generally prohibits bribery of foreign officials by U.S. companies. By now, lawyers and executives at multi-nationals recognize that the FCPA exists, that U.S. companies need an anticorruption compliance program and that the costs of not having such a program can be significant. Since Siemens paid $1.6 billion (the largest fine to date) to resolve charges with regulators,2 many other companies have been hit with multi-million dollar penalties.3 While the need is well-known, many companies fail to appreciate the practical difficulties of implementing an effective compliance program across multiple countries.
1 See, U.S. Dept. of Justice, U.S. Attorneys’ Manual §9-28.300 (2008), available at http://www.justice.gov/usao/eousa/foia_reading_room/usam/title9/28mcrm.htm (considering "existence and effectiveness of the corporation’s pre-existing compliance program" in determining whether to charge a corporation); U.S. Sentencing Comm’n, U.S. Sentencing Guidelines §8B2.1 (2013), available at http://www.ussc.gov/guidelinesmanual/2013-ussc-guidelines-manual (considering effectiveness of corporation’s compliance program to reduce culpability score).
2 U.S. Sec. and Exch. Comm’n, SEC Charges Seven Former Siemens Executives with Bribing Leaders in Argentina, (Dec. 13, 2011), http://www.sec.gov/news/press/2011/2011-263.htm.
3 See, e.g. U.S. Sec. & Exch. Comm’n, SEC Charges Total S.A. for Illegal Payments to Iranian Official, (May 29, 2013), http://www.sec.gov/News/PressRelease/Detail/PressRelease/1365171575006 (paying $398 million to settle SEC and DOJ charges).
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