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The Alcoa FCPA Settlement: Are We Entering Strict Liability Anti-Bribery Regime?

The Harvard Law School Forum on Corporate Governance and Financial Regulation
February 5, 2014

“This Order contains no findings that an officer, director or employee of Alcoa knowingly engaged in the bribe scheme.”

There are several notable aspects of aluminum producer Alcoa, Inc.’s (“Alcoa”) recent FCPA settlement.  The $384 million in penalties, forfeitures and disgorgement qualify as the fifth largest FCPA case to date.  Further, it is remarkable that such a large monetary sanction was imposed when the criminal charges brought by the U.K. Serious Fraud Office against the consultant central to the alleged bribery scheme were dismissed on the grounds that there was no “realistic prospect of conviction.”  Perhaps most striking, however, is the theory of parent corporate liability that the settlement reflects.  Although there is no allegation that an Alcoa official participated in, or knew of, the improper payments made by its subsidiaries, the government held the parent corporation liable for FCPA anti-bribery violations under purported “agency” principles.  Alcoa serves as an important marker in what appears to be a steady progression toward a strict liability FCPA regime.  Click here to read the full article.