Since 1977, U.S. companies conducting business with foreign government entities and government officials have had to comply with the Foreign Corrupt Practices Act (FCPA), specifying that they may not bribe any foreign official to obtain or retain business. Companies and individuals found in violation of the FCPA may be subject to substantial fines, imprisonment, and/or forfeiture of property, and with the recent upsurge in enforcement by government agencies, companies more than ever need to work diligently to ensure compliance with the Act and its provisions.
Wiley Rein advises U.S. and foreign companies on developing, implementing and rigorously reviewing their FCPA compliance programs, and on familiarizing their overseas branches, subsidiaries, managers and agents with corporate procedures for handling contracts with foreign government entities or involving government officials.
Led by partners John R. Shane and Daniel B. Pickard, and in conjunction with nationally known government ethics specialist Jan Witold Baran and his team, our FCPA team counsels a wide variety of clients across multiple industries on conducting business globally in an era of heightened FCPA enforcement. Our attorneys' work on FCPA issues not only encompasses issues directly associated with compliance programs, but also entails risk assessment, conducting internal investigations related to potential violations, transaction counseling (when working with state-owned entities or other high-risk enterprises) and advising buyers and sellers regarding FCPA due diligence in mergers and acquisitions.
Our firm provides tactful resolution of compliance issues and potential violations by U.S. and foreign companies, recognizing the need for discretion in these sensitive matters. To help our clients avoid FCPA entanglements, we encourage them to act proactively to deter and detect any possible infringements. We regularly assist companies with:
- Devising formal policy statements;
- Publishing company-wide ethics manuals;
- Conducting training programs and seminars;
- Establishing mechanisms for coordinating/operating the compliance program ("compliance clearinghouse");
- Maintaining accurate accounting and record-keeping systems; and
- Setting up anonymous reporting procedures.
As mentioned above, our premier Election Law & Government Ethics practice is significantly involved in our FCPA-specific work. The group has successfully represented clients-including many of the country's largest corporations and trade associations-before federal agencies involved with FCPA. We regularly advise on corporate guidelines regarding the activities of foreign nationals and overseas corporations in Washington, DC, represent clients in all stages of criminal and civil proceedings, and conduct internal investigations and develop individualized compliance programs to minimize both the risk and the adverse consequences of improper conduct. Notably, we also represent individuals facing FCPA issues, such as Department of Justice (DOJ) enforcement actions or professional exposure due to problematic transactions.
Tracking FCPA-Related Developments | Development of an FCPA Compliance Program | Performing Thorough FCPA Due Diligence | FCPA Considerations in Mergers and Acquisitions | Recognizing FCPA Enforcement Patterns | Contact Us
Tracking FCPA-Related Developments
With our well-established presence in the nation’s capital, Wiley Rein stays apprised of the most pertinent developments concerning FCPA and its enforcement, allowing us to assist clients in clarifying all relevant court decisions, analyzing trends in agency attitudes toward voluntary disclosures, navigating the internal control and reporting requirements imposed on publicly traded companies by the Sarbanes-Oxley Act, and interpreting the significance of any other matters that may influence the scope and enforcement of FCPA.
Our FCPA attorneys know the most up-to-date enforcement procedures of government agencies including the DOJ and the Securities and Exchange Commission (SEC). We review the reasoning behind all applicable court rulings to discern how the FCPA currently is being interpreted and applied, determine which companies could be under the greatest scrutiny, examine new laws that relate to foreign transactions and help companies gain a better understanding of the United Nations Convention Against Corruption (UNCAC) and its provisions on criminalization, international cooperation, asset recovery and prevention.
Development of an FCPA Compliance Program
Wiley Rein recognizes that a well-conceived compliance program is an essential element for avoiding trouble, and, should problems arise, serves as a critical mitigating factor under the corporate sentencing guidelines. Our attorneys can steer companies through the entire program development and monitoring process – writing formal corporate statements, producing written manuals of compliance standards and procedures to be followed by employees and agents, conducting training programs and seminars for employees focusing on real-world solutions to FCPA problems, updating internal compliance committees on statutory and business developments, advising on business development contracts with agents in foreign jurisdictions and assisting with audits, among other activities.
The firm works closely with all directors, officers, employees and agents with responsibilities for planning, approving, monitoring and recording international activities and transactions, helping them create an internal system of checks and balances that is integrated into the routine business processes of the company and proactively take remedial actions in response to FCPA compliance problems.
Performing Thorough FCPA Due Diligence
Wiley Rein offers step-by-step guidance to companies in examining the business reputation and past conduct of foreign agents and business partners, knowing that it is essential for companies to undertake and document appropriate due diligence with specific attention to potential “red flags” before pursuing transactions or other business opportunities in foreign countries.
Our relationships with the State Department and Commerce Department are invaluable to clients when conducting business checks, and we use our international relationships to keep clients abreast of developments in foreign countries in which they do business. We also work with local counsel in those nations, when necessary, to gauge the legality of the proposed activities and transactions under the laws of those countries and to determine the risk of FCPA violations. In addition, we offer guidance on contractual provisions and help craft the “intent to comply with FCPA” contract terms that carry great weight with the DOJ and SEC when they examine the details of a company’s foreign dealings.
FCPA Considerations in Mergers and Acquisitions
Wiley Rein’s attorneys methodically analyze mergers and acquisitions on behalf of both buyers and sellers to ascertain the potential for FCPA violations to influence the timeliness of a transaction, the overall cost of a transaction and the ability to close a transaction, as well as the possible regulatory pitfalls and liability risks that may be assumed by the successor company.
Our professionals can direct companies through the process of conducting an FCPA compliance review of the newly acquired company, disclosing any findings of additional misconduct to the DOJ, providing for appropriate discipline of all offenders and implementing rigorous anti-corruption compliance policies and internal controls to avoid future FCPA problems. On behalf of target companies, we assist in establishing appropriate internal control systems, adopting acquirers’ FCPA compliance programs and cooperating with the DOJ and SEC in their investigation of violations.
Recognizing FCPA Enforcement Patterns
Wiley Rein’s ability to identify recurring SEC and DOJ enforcement patterns with regard to FCPA violations allows us to provide valuable counsel to clients on the precautions they should take to protect themselves, and their best course of action should agency intervention seem imminent. Among the patterns we help clients identify are:
- Whether the region of the world in which they are doing business is more prone to FCPA violations;
- Whether their industry is one at high risk for being cited;
- Whether the commissions being paid to foreign agents are appropriate or if they seem unreasonably high and more likely to attract the government’s attention;
- Whether their agent’s connection to the foreign government could be problematic; and
- Whether large bonus payments to foreign agents could be considered as an FCPA violation.
The firm can also help companies determine the type of penalties for which they may be at risk and how much they could be fined, as well as if some of the aggressive DOJ and SEC enforcement actions taken recently pose a threat to any of their activities.
SEC Charges Chinese Affiliates of Major Accounting Firms with U.S. Securities Laws Violations
By Adam H. Gordon
December 10, 2012
FCPA: What the DOJ and SEC’s Long-Awaited Guidance Means for Business
By Ralph J. Caccia, John R. Shane, Rebecca F. Napolitano and Brandon J. Moss
December 2012 | The Metropolitan Corporate Counsel Volume 20, No. 12
Russia Takes Critical Step to Join the OECD Anti-Bribery Convention
By John R. Shane, Daniel B. Pickard and Nova J. Daly
March 2, 2012