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Under the FCPA, a bribe does not need to be paid in order to violate the law. The FCPA’s anti-bribery provisions apply to a broad array of organizations and individuals including US companies and their officers, directors, employees, stockholders, and agents (including third-party agents, consultants, and others), American citizens, American nationals, American residents, and foreign corporations that trade securities in the US, and others. Those who are not explicitly covered by the FCPA may be prosecuted under it if they, or their agent, engage in furthering a corrupt payment. For example, if a foreign national were to attend a meeting in the US to arrange a bribe from a US company to someone in his government, that foreign national would be subject to prosecution under the FCPA.
It is not a violation of the FCPA, however, if (i) the payments are legal under the written laws of the country in which the payments are made; or (ii) the payment is a reasonable expenditure directly related to the conducting of business with a foreign government.
Additionally, the FCPA requires that certain accounting provisions are met by publicly traded companies in the United States. This requirement is designed to prevent the use of accounting schemes to hide bribes or other unlawful payments and to offer an accurate representation of the company’s finances to shareholders and the SEC.
FCPA penalties are particularly significant, in part because the contracts underlying the bribery scheme are often worth a great deal and also because the cases usually involve parallel proceedings by the SEC and DOJ.
In recent years, on average, 4.9% of all SEC whistleblower tips have involved this type of securities violation.