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« Lindsey And Lee Reply to Feds | Main | In Oman, Exposing Graft Is A Crime »
Monday
Sep262011

Amending the FCPA: If It Ain't Broke . . . .

Only time will tell if Congress sticks with the old adage, "If it ain't broke, don't fix it," or trades it in for a new one: "If it ain't broke, don't enforce it...then fix it."

In a recent letter to Congress "to oppose troubling proposals to weaken the landmark Foreign Corrupt Practices Act (FCPA)," Danielle Brian and Angela Canterbury of the Project On Government Oversight (POGO) addressed what they referred to as a "misinformation campaign underway to convince Congress that a law that is not broken requires fixing." They said:

The U.S. Chamber of Commerce claims [that] enforcement of the FCPA is excessive and is lobbying to reduce liability for companies (their members) that bribe foreign officials. The Chamber has proposed removing liability for subsidiaries that bribe; allowing mergers to provide immunity for past acts; creating exceptions for companies that have a “compliance program;” requiring not only intention to bribe, but that it also be a “willful” act; and redefining a “foreign official.”

Perhaps amending the FCPA to impose lighter penalties on American businesses that routinely trade bribes for business overseas wouldn't be such a bad idea after all - right? Perhaps a legislative quick-fix of this nature would help grease supply chains around the world and usher in a new era of prosperity and job creation in America; in other words, such an amendment would provide the shot in the arm our nation's ailing economy so desperately needs - right? Wrong.

As POGO's letter goes on to explain,

Law-abiding American businesses would be disadvantaged by relaxing the scope of FCPA enforcement. It also would create uncertainty for businesses and investors in the global marketplace.  Allowing American companies more latitude for bribing foreign officials sends the wrong message.

The letter concludes that "[e]xcessive enforcement of the FCPA is not the problem; lack of enforcement is," citing the too-big-to-debar problem as one alternative explanation for the FCPA's ineffectiveness.

Indeed, only time will tell if Congress will continue to follow the age-old adage, "If it ain't broke, don't fix it," or will instead adopt a new one: "If it ain't broke, don't enforce it...then fix it."

________________

Nick Wagoner will be joining Rogers, Morris & Grover's Houston office as an associate in November. The article he co-wrote with Professor Drury Stevenson, "FCPA Sanctions: Too Big to Debar?," will appear in the Fordham Law Review's November 2011 volume 80. Nick’s scholarship is available at www.nicholaswagoner.com, and he can be contacted here.

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