President Donald Trump is set to order a suspension of the Foreign Corrupt Practices Act (FCPA), which prohibits U.S. companies from bribing foreign officials to boost business interests. Reports suggest Trump will sign an executive order on Monday afternoon, outlining the temporary policy shift.
According to Bloomberg News, the pause will last until new enforcement guidelines are issued. The administration aims to level the playing field for U.S. companies, ensuring they aren’t at a disadvantage compared to international competitors. A fact sheet cited by Bloomberg states that overenforcement of the FCPA harms U.S. businesses by preventing them from engaging in practices commonly used by global competitors.
“U.S. companies are harmed by FCPA overenforcement because they are prohibited from engaging in practices common among international competitors, creating an uneven playing field,” the fact sheet reads.
Under the new policy, Attorney General Pam Bondi will pause all FCPA actions until she issues updated enforcement guidelines. The administration also plans to review past enforcement actions.
Harry Sandick, a white-collar defense attorney and former U.S. Attorney, told Barron’s that halting FCPA enforcement would be “unprecedented.” He emphasized that both political parties have historically supported the FCPA, given its role in addressing global corruption. Sandick noted that the FCPA has contributed to reducing corruption by giving corporate compliance officers the authority to enforce ethical practices.
The FCPA, enacted in 1977, makes it illegal for individuals and companies to offer bribes to foreign officials to win or retain business. The law criminalizes payments made through the mail or interstate commerce that seek to influence foreign officials in violation of their duties or to gain improper business advantages. Violators can face up to 15 years in prison and fines of up to $250,000 or three times the bribe’s value.
Richard Bistrong, CEO of Front-Line Anti-Bribery LLC, warned that suspending the FCPA could impact the FBI’s international corruption units and prosecutors with expertise in bribery cases. Bistrong pointed out that the U.S. was a pioneer in anti-bribery laws, having recovered billions of dollars in penalties over the years. He stressed that this is the first time the FCPA has been formally paused.
Bistrong, who served prison time for violating the FCPA, questioned the Trump administration’s argument that the law puts U.S. companies at a disadvantage. He predicted that most corporations will not alter their compliance policies in response to the change.
On February 5, Bondi issued a memo indicating that Trump wants to revise national security and counter-narcotics strategies. This includes prioritizing investigations into foreign bribery related to cartels and transnational criminal organizations (TCOs), rather than cases with no such connection.
A blog from law firm Holland & Knight called the update “a game-changer” for attorneys advising companies on FCPA inquiries. The new focus will examine foreign bribery in relation to narcotics trafficking, money laundering, human trafficking, or violence. Bribery cases unrelated to these issues, such as those involving energy contracts or airport concessions, will receive less attention.
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