The Influence of Corruption on the Developing World: The Foreign Corrupt Practices Act, International Commerce and Africa

In recent years, the Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) have enforced the Foreign Corrupt Practices Act (FCPA) with increasing rigor. These zealous enforcement practices have been criticized for putting excessive pressure on companies to settle, often through nonprosecution or deferred prosecution agreements. The resulting proliferation of such settlements has created a dearth of case law interpreting the statute, resulting in legal ambiguity that reinforces pressures on companies to continue to settle rather than litigate, as uncertainty of the law adds to risk. This dynamic is exacerbated by the broad vicarious liability that firms face for the wrongdoing of individual actors. Given the need for government to enlist business as a partner in any effective battle against global corruption, the current highly adversarial relationship between enforcement agencies and firms is unreasonable and counterproductive. The law and its enforcement agencies should go further in providing incentives for businesses to develop and implement strong good-faith FCPA compliance programs. They should establish standards for rigorous compliance programs that would provide qualifying companies with a defense against entity liability for the corrupt behavior of individuals. Creation of a qualifying good-faith compliance program defense would help to prevent future FCPA violations, to recruit companies as partners in fighting corruption, to encourage ethics-oriented corporate cultures, and to encourage upstanding firms to do business in regimes where rectitude is most needed.

show abstract

The Influence of Corruption on the Developing World: The Foreign Corrupt Practices Act, International Commerce and Africa

Abstract: The Foreign Corrupt Practices Act (FCPA) demonstrates the United States’ commitment to fight against bribery and corruption and the FCPA has had a substantial impact on commerce between organizations in the United States and the developing word.

Cited by 2 publications

References 1 publication

Corruption and Its Consequences

Corruption and Its Consequences

Mitigating the Harshness of FCPA Enforcement Through a Qualifying Good‐Faith Compliance Defense

Contact Info

Product

Resources

About