Facilitation payment under the Foreign Corrupt Practices Act (FCPA) of the United States and its effect on corruption in Nigeria (original) (raw)
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UNIVERSITY OF LIVERPOOL SCHOOL OF LAW, 2017
The emergence of the United States Foreign Corrupt Practices Act has cast a shadow over the world. As a Washington lawyer put it, “you could be based on Mars and [US Department of] Justice will come after you” . Regardless of a multinational company’s country of origin or where such a company conducts its business, once they have a certain connection to the United States, their activities will inevitably be impacted by this U.S. law. The FCPA applies to U.S companies, foreign companies that have some ties to the U.S., U.S. citizens, residents or nationals that are involved in a foreign corrupt practice. The offenders do not even have to be physically present on U.S. soil. The United States Department of Justice and the Securities and Exchange Commission are the principal bodies that enforce this law. The DOJ and SEC have ratcheted up the number of investigations, settlements and prosecution of FCPA violations in the last decade. With this increased enforcement activity, management and legal advisers to multinational companies have to have a precise understanding of what conduct is not allowed by the FCPA. They have to be constantly aware of the trends in enforcement. Most, importantly, management must recognise the “red flags”. These are circumstances where there is a high risk of corruption. The FCPA is a very unforgiving law that subjects individuals and corporations to prosecution for corrupt payments even when they are not aware that bribes were paid. The FCPA will find a person or corporation criminally liable even where they pay third parties without taking into consideration that this money will be used for corrupt purposes. . This was demonstrated succinctly in the Titan case, where the company paid $3.5 million to an agent while ignoring the fact that he was a business advisor to the President of Benin . The FCPA obliges companies to conduct meaningful due diligence and not overlook or ignore suspicious conduct by their agents or consultants.
Patterns in international bribery: Violations of the foreign corrupt practices act
Thunderbird International Business Review, 2012
Act shows that officials in less developed countries are the likely recipients of bribes; that bribery occurs more often in the capital-intensive industries of energy, construction, telecommunications, and military equipment; that firms more often tend to use intermediaries and agents to consummate illicit transactions rather than directly paying the intended beneficiary; and that the overall motivation for bribing is to secure a particular contract. This article reviews the evolving enforcement of the law and recommends a set of managerial actions to reduce corporate liability and improve governance practices.
Between Impunity and Imperialism: The Regulation of Transnational Bribery
Laws, 2021
The Regulation of Transnational Bribery by Kevin E. Davis, strips out the universal character of illegitimate payments used to bribe public officials of foreign countries in the milieu of international business which has been known for years. The manuscript deals with various definitions of bribery as a transaction in which an official misuse his or her office “as a result of considerations of personal gain, which need not be monetary”. The book highlights the current debate about prohibiting transnational bribery. Such a debate is not about the practicality or desirability of the United States’ FCPA, which at one time was the only law in the world that efficiently banned transnational bribery.
The Foreign Corrupt Practices Act: Why It Fails to Deter Bribery as a Global Market Entry Strategy
Journal of Business Ethics, 2014
- revealed that in the first 28 years of its existence, the Foreign Corrupt Practices Act was not enforced by the federal government. The Weismann study further concluded that the FCPA, designed by Congress as a selfregulatory model of corporate governance, failed to achieve the regulatory goal of deterring global bribery by U.S. companies. The current article addresses the reasons that the FCPA remains an ineffective measure to control bribery as a global market entry strategy despite the highly publicized 2006 Department of Justice initiative to increase prosecutions and tighten enforcement efforts. The failure arises out of both the increased use of informal dispositions of case prosecutions, (including non-prosecution and deferred prosecution agreements), which has made ''getting caught'' merely an increased ''cost of doing business'' and the failure to close the regulatory gaps in the statute that permit violators to slip through the enforcement net. The article updates and compiles the case prosecution data for every reported case prosecuted between 1977 and 2011. That data are then compared to the results of a 2010 integrity risk survey performed by Deloitte Financial Advisory Services and Forbes which reveal a widely held global business perception that compliance and integrity risks appear to be rising sharply and that the FCPA is ineffective in deterring bribery and corruption in foreign markets. The article aims to serve as a predictive tool for policy makers and business professionals in assessing risk in the global markets, particularly as commerce intensifies in the BRIC countries, notable for bribery and corruption.
THE FOREIGN CORRUPT PRACTICES ACTS OF YEARS 1977 AND 1981
This report is a discussion of the Foreign Corrupt Practices Act (FCPA) of 1977 and the corrupt deeds which it is meant to address. We often hear of those deeds on the television and radio, or read about them in the news. We have a tendency to ignore them or, at most, we react with uncaring emotions. Our thought is often; "there's nothing we can do anyway, so why get upset." Occasionally, the media will show us the actual perpetrators. Some of them shy away from the cameras, covering their faces with their coats. More and more often the accused stand proud. We seldom recognize or admit that everyone inevitably becomes their victim.
Organising the Finances For and the Finances From Transnational Corporate Bribery
This article analyses the finances for and the finances from corporate bribery in international business transactions and how they are organised. Transnational corporate bribery involves non-criminal commercial enterprises that operate in licit markets but that use corrupt means to win or maintain business contracts in foreign jurisdictions. This article first considers what needs to be financed, how much finance is needed, and how the bribes can be generated and distributed. Second, the article considers the different forms of proceeds that emerge out of the bribery, how offenders must conceal the derivation of funds from these crimes while also retaining control over them, and how they must overcome particular obstacles. Finally, the article discusses responses to the proceeds of bribery and related anti-money laundering provisions, before analysing actual and potential mechanisms for intervening with the finances for and from transnational corporate corruption.