Preface

• Author: Robert W. Tarun
• Profession: Former Executive Assistant U.S. Attorney in Chicago
• Pages: 33-36

Preface

Enforcement of the Foreign Corrupt Practices Act (FCPA) in the past decade has

increased dramatically. The United States Department of Justice (DOJ) and the Secu-

rities and Exchange Commission (SEC) are reportedly conducting over 150 investi-

gations of U.S. and foreign companies,1 their joint ventures, employees, and third-

party contractors for alleged improper payments around the world. There is no rea-

son to believe this trend will subside here in the United States or elsewhere. Indeed,

there is now clear momentum and a clear incentive among foreign governments to

investigate bribery and related conduct under various international conventions.

The era of mysterious “one man” consultancies, extravagant behind-the-curtain

gifts to foreign officials, minimal due diligence of foreign agents, and willful blind-

ness to the conduct of joint venture partners has been coming to a close. Corporate

directors and officers can no longer ignore or rationalize unusually large foreign

sales budgets, lucrative consultancies, or extravagant entertainment with shadowy

or unknown figures with the words, “This is the way business is done in that part of

the world.” While there remain some lax foreign states that knowingly permit their

citizens to engage in corrupt practices in distant countries, they are a minority,

their world is shrinking, and they will likely have to reform if they wish to remain

members of an increasingly transparent international business community. Trans-

parency has become the governing watchword in multinational mergers, acquisi-

tions, joint ventures, and corporate transactions.

Increased FCPA and anticorruption enforcement means increased responsibili-

ties for boards of directors, general counsel, and transactional lawyers—and new and

uncharted waters for white-collar criminal prosecutors and defense lawyers. “Preven-

tative law” in the form of proactive counseling and director, officer, and employee

training is the smart way for corporations to manage risk in an area where missteps

can be very costly. Quality antibribery and record-keeping training along with reg-

ular monitoring and recorded due diligence on the front end of mergers, acquisi-

tions, joint ventures, and third-party contracts can minimize criminal liability and

avoid lengthy investigations, serious fines and disgorgement, substantial legal fees,

and damage to corporate and executive reputations. There is no substitute for live

antibribery training of senior officers and employees responsible for foreign sales,

finance, and accounting. As important, thorough preacquisition due diligence may

be the most compelling defense and route to avoid costly successor criminal liability.

Over five years ago, Professor Julie R. O’Sullivan of Georgetown Law Center

observed:

FCPA work is a vital area of white-collar criminal practice because

lawyers are consulted not just when a potentially corrupt payment is

uncovered by the government, but also at every stage leading up to

that point. Thus, FCPA practitioners consult with companies, among

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