NEWARK, N.J., March 13, 2012 /PRNewswire/ -- Although American companies and individuals have been the focus of a series of high-profile prosecutions under the Foreign Corrupt Practices Act (FCPA), foreign firms are far from out of the spotlight of FCPA investigations, writes LeClairRyan attorney Carlos Ortiz in a March 5 column published by CorporateComplianceInsights.com.
In the column ("Cases Largely Involve U.S. Companies, But Reach Of FCPA & Travel Act Extend To Foreign Companies, Too"), the veteran former federal prosecutor and white collar defense attorney notes that foreign companies and citizens have increasingly been snared by the FCPA and by the even-broader federal Travel Act, even if the targeted officials never set foot in the U.S. LeClairRyan associate Valerie C. Charles contributed to the column. Both are based in the firm's Newark, N.J. office.
The FCPA's anti-bribery provisions make it unlawful for any "issuer, domestic concern or person acting within the U.S. to offer or make a payment of anything of value" to a foreign official, Ortiz and Charles write, while the Travel Act prohibits the use of communications and travel facilities to commit crimes. They note that the Department of Justice (DOJ) has aggressively interpreted the regulations to argue that "money or other benefits flowing from any foreign entity into a U.S. affiliate, subsidiary, parent or business partner creates the condition of agency, partnership or joint venture," thus placing the foreign entity under the FCPA's anti-bribery provisions.
"Even if an alleged violation occurs without direct knowledge on the part of employees and officers of the U.S. entity, DOJ still has the ability to prosecute the foreign entity or individual as an agent of the U.S. entity," they warn.
Noteworthy examples include United Kingdom citizen Jeffrey Tesler, who awaits sentencing after pleading guilty to violating FCPA's anti-bribery provisions. He was charged with bribing Nigerian officials through his representation of a joint venture seeking to build natural gas facilities in Nigeria. "The DOJ asserted jurisdiction due to use of correspondent accounts in New York and benefit derived by the U.S. member of the venture," they explain.
To avoid ensnarement by the Travel Act and the FCPA, companies with affiliates, parents, or other agency relationships in the U.S. should promptly consider implementing anti-corruption policies and training, Ortiz and Charles advise.
"Foreign companies with U.S. connections should also consider performing due diligence regarding existing business partners and agents used abroad," they write. "They may also consider implementing a policy of performing due diligence on any potential foreign partners and/or agents."
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