Scaling back the Foreign Corrupt Practices Act
Just this week, the US Department of Justice has clearly spelled out that it is scaling back on the cornerstone of the US’s fight against corruption overseas, ending it’s freeze on the Federal Corrupt Practices Act (FCPA). Reuters’ noted that their approach now “will focus the DOJ's scrutiny on alleged misconduct that hurts U.S. firms' ability to compete with foreign rivals, involves key infrastructure and is tied to operations of a cartel or transnational criminal organization.”
They also will allow more emphasis on mitigating behavior versus enforcement. The message that is sent is that if a company bribes or any way violates the FCPA, and they can show that they will cooperate, mitigate and show remorse in essence, the CEO won’t have to worry. So much of the previous approach was based upon constant mitigation practices as well as constant education, and I can personally attest to this as well as the effectiveness of all the ongoing training. Stringent anti-corruption policies which were in place as part of the company’s mitigation policy, supported companies and demonstrated their integrity. Additionally, the enforcement elements were also known, and the knowledge that the CEO or other senior managers could find themselves in jail for my behavior in the field did keep them up at night. With this new approach, the idea of US competitiveness is presented as an important element, so will that be considered as a mitigating factor? So much of anti-corruption is an understanding that the behavior of US companies globally is based upon the fact that they don’t pay bribes.
What will happen next and what do we do next? So far companies are still thinking twice – they don’t know which way the wind will blow, and when the law was first enacted, corruption was more prevalent, and many of today’s positive changes were not yet made. Additionally, the fact is that the FCPA continues in the same manner as it was and also it has not yet been repealed. It is in force and as such it can be revitalized by the next Attorney General. And for now, there is no discussion regarding its repeal and so we must be on the lookout for such noises or movement. This is also the time for overseas anti-corruption leaders to be vigilant and hold US companies accountable and rely more on their own enforcement mechanisms. Today we do stand on the precipice, and we will see and hear if almost 50 years of this law’s effectiveness will still stand for integrity in business, even if US law enforcement is willing to turn a blind eye.
Link:
https://prospect.org/politics/2025-06-11-trump-foreign-corrupt-practices-act/