Dec. 2011/Jan. 2012 / Point-Counterpoint
Should Congress Amend the Foreign Corrupt Practices Act?
The U.S. Chamber of Commerce is spearheading a drive to amend the Foreign Corrupt Practices Act. It suggests, among other proposals, that a company be able to invoke the existence of a corporate compliance policy as a defense.
Sarah Pray of the Open Society Policy Center argues that the Department of Justice already takes compliance programs into account at charging and sentencing. Creating a compliance defense, she says, could allow a company to escape liability for its intentional acts simply by virtue of having a policy it doesn’t follow. Bribery, says Pray, negatively impacts corporations with reputation damage and distorted prices. Consumers lose when they are no longer guaranteed the fairest price subject to competition and the open market.
Mike Koehler of Butler University calls the FCPA a fundamentally sound statute that nevertheless should not be immune from scrutiny. He says existing DOJ policy regarding compliance merely lessens the impact of legal exposure. It does not adequately recognize a company’s commitment to compliance, which should be recognized as a matter of law when a non-executive employee acts contrary to pre-existing policies.
He takes exception to claims that an FCPA compliance defense would reward “fig leaf” or “purely paper” compliance, or eliminate corporate criminal liability under the FCPA. A compliance defense would not be relevant to corrupt business organizations, activity engaged in or condoned by executive officers, or activity by any employee if it occurred in the absence of pre-existing compliance policies and procedures.
