When the FBI Comes Calling…®

CORRUPTION AND BRIBERY OF PUBLIC OFFICIALS (continued)

Foreign Corrupt Practices Act
The Foreign Corrupt Practices Act is a statute that is beginning to be used more and more often. In the Fall of 2005, Viktor Kozeny was indicted in the United States for allegedly violating this law, and he is currently facing extradition proceedings in the Bahamas.

15 U.S.C. § 78dd-1 (2006).
The Crime
Under section 78dd-1, it is a crime for

  • an issuer which has a class of registered securities, or
  • which is required to file reports, or
  • for any officer, director, employee, or agent of such issuer, or
  • any stockholder thereof acting on behalf of such issuer

to make use of the mails or any means or instrumentality of interstate commerce corruptly in furtherance of

  • an offer, payment, promise to pay, or
  • authorization of the payment of any money, or
  • offer, gift, promise to give, or
  • authorization of the giving of anything of value to—
    • any foreign official for purposes of—
      • influencing any act or decision of such foreign official in his official capacity; inducing such foreign official to do or omit to do any act in violation of the lawful duty of such official; or securing any improper advantage; 15 U.S.C. § 78dd-1(a)(1)(A); or
      • inducing such foreign official to use his influence with a foreign government or instrumentality thereof to affect or influence any act or decision of such government or instrumentality, Id. § 78dd-1(a)(1)(B)
        • in order to assist such issuer in obtaining or retaining business for or with, or directing business to, any person;
    • any foreign political party or official thereof or any candidate for foreign political office for purposes of—
      • influencing any act or decision of such foreign official in his official capacity; inducing such foreign official to do or omit to do any act in violation of the lawful duty of such official; or securing any improper advantage; Id. § 78dd-1(a)(2)(A); or
      • inducing such party, official, or candidate to use its or his influence with a foreign government or instrumentality thereof to affect or influence any act or decision of such government or instrumentality, Id. § 78dd-1(a)(2)(B)
        • in order to assist such issuer in obtaining or retaining business for or with, or directing business to, any person; or
    • any person, while knowing that all or a portion of such money or thing of value will be offered, given, or promised, directly or indirectly, to any foreign official, to any foreign political party or official thereof, or to any candidate for foreign political office, for purposes of—
      • influencing any act or decision of such foreign official, political party, party official, or candidate in his or its official capacity; inducing such foreign official, political party, party official, or candidate to do or omit to do any act in violation of the lawful duty of such foreign official, political party, party official, or candidate; or securing any improper advantage; Id § 78dd-1(a)(3)(A); or
      • inducing such foreign official, political party, party official, or candidate to use his or its influence with a foreign government or instrumentality thereof to affect or influence any act or decision of such government or instrumentality, Id. § 78dd-1(a)(3)(B)
      in order to assist such issuer in obtaining or retaining business for or with, or directing business to, any person.

It is also a crime for

  • any issuer organized under the laws of the United States, or a State, territory, possession, or commonwealth of the United States…and which has a class" of registered securities, or
  • which is required to file reports, or
  • for any United States person that is an officer, director, employee, or agent of such issuer, or
  • a stockholder thereof acting on behalf of such issuer,

to corruptly do any act outside the United States in furtherance of an

  • offer, payment, promise to pay, or
  • authorization of the giving of anything of value

    • to any of the people or entities listed above, irrespective of whether such issuer or such officer, director, employee, agent, or stockholder makes use of the mails or any means or instrumentality of interstate commerce in furtherance of such offer, gift, payment, promise, or authorization. Id § 78dd-1(g)(1).

    These same prohibitions apply to "any domestic concern" or "any officer director, employee, or agent" of a domestic concern, or any stockholder of a domestic concern. Id. § 78dd-2(a). A "domestic concern" is

    • any individual who is a citizen, national, or resident of the United States; and
    • any corporation, partnership, association, joint-stock company, business trust, unincorporated organization, or sole proprietorship which has its principal place of business in the United States, or which is organized under the laws of a State of the United States or a territory, possession, or commonwealth of the United States. Id. § 78dd-2(h)(1).

    Finally, the prohibitions also apply to any person other than an issuer, as described in section 78dd-1, or a domestic concern, as described in section 78dd-2. Id. § 78dd-3(a). The term "person," when referring to an offender, "means any natural person other than a national of the United States … or any corporation, partnership, association, joint-stock company, business trust, unincorporated organization, or sole proprietorship organized under the law of a foreign nation or a political subdivision thereof." Id. § 78dd-3(f)(1).

    Corruption Continued-->