Friday, August 3, 2018
Veronica Root (Notre Dame Law School) has posted The Outsized Influence of the FCPA (2018 Illinois Law Review __ (2018) (Forthcoming)) on SSRN. Here is the abstract:
The current power and influence of the Foreign Corrupt Practices Act (“FCPA”) is really quite remarkable when one considers the statute was largely ignored for its first twenty-five years of existence. This statute, meant to reign in corruption by United States companies doing business abroad; has generated billions of dollars in revenue for the United States government; prompted the development of law firm practice groups and law school courses; become the subject of numerous scholarly articles; and has, arguably, made anti-bribery efforts the highest of priorities for multinational corporations engaged in robust compliance efforts. Corporations, scholars, and the public would be silly to discount the importance of understanding and maintaining compliance with the FCPA and its international counterparts.
And yet, might it be that prioritization of FCPA compliance is misguided in some instances? This Essay argues that governmental actors, industry leaders, corporations, and scholars must critically assess whether the current focus on FCPA compliance has created an environment where the FCPA has developed an outsized influence within corporations’ compliance efforts. This Essay asks firms to consider whether they have become so concerned with ensuring compliance with the FCPA that they sometimes fail to identify other areas of risk that are equally, and in some instances more, serious. Specifically, firms might assess whether they sometimes (i) miss when there are broader deficiencies within their compliance programs; (ii) fail to see trends across compliance areas involving diverse regulatory and legal areas; and (iii) improperly prioritize necessary revisions to their compliance programs after significant misconduct is discovered. Instead of starting with the FCPA when creating a compliance program, this Essay urges firms to assess their risks more broadly and develop compliance programs closely targeted to their risk profiles while paying careful attention not to allow the FCPA to dominate those efforts. By doing so, firms can appropriately guard against potential FCPA compliance failures while also ensuring that they properly consider and address other regulatory and legal areas of concerns.