Long Live the FCPA!(?)
President Trump pulled out his black sharpie and tried to kill the Foreign Corrupt Practices Act. The President’s executive order on February 10 stated: “Current FCPA enforcement impedes the United States’ foreign policy objectives and therefore implicates the President’s Article II authority over foreign affairs.”
So companies should load up their briefcases full of cash and start buying those contracts from foreign leaders. Right? Right?…
Um… The Foreign Corrupt Practices Act is still the law of the land.
The President does not have the power to make the law go away. The Executive Order merely orders the Attorney General to hold off bringing any new FCPA cases, “unless the Attorney General determines that an individual exception should be made”. That last clause should leave a whole lot of doubt in your mind. This administration has shown the propensity to attack those it doesn’t like. Get on its bad side and maybe an “individual exception” will be made.
The other problem is that the statute of limitations is five years. Just because the Trump administration doesn’t bring a case, there is nothing stopping the next administration from bringing the case. (Assuming Trump doesn’t grant himself the right to serve a third term.)
This seems to put companies in a worse situation. Prior to this week, they could just say “Hey, we would love to pay you a bribe, but we can’t because it’s illegal.” Now, they have lost that shield and will be in this conundrum of being able to pay a bribe, but still at risk for future prosecution. I doubt many companies will want to risk future prosecution and change their policies.
The big winners are any companies currently under investigation for FCPA violations. They’re likely in the clear. Law firms can start moving lawyers over to different cases and different areas. (Feel free to wonder if any of those companies under investigation are Trump campaign donors, own shares in Trump Media, or own a stack of $Trump meme coins. So many ways to buy influence.)
Sources:
- Pausing Foreign Corrupt Practices Act Enforcement to Further American Economic and National Security
- Trump Halts FCPA Enforcement by Matt Kelly in Radical Compliance
- Trump Curbs Enforcement of Antibribery Law by Dave Michaels in the Wall Street Journal