In understanding the FCPA, it is essential that attorneys, international lawyers, in-house counsel, and others providing legal and compliance advice recognize that a person need not be directly subject to the FCPA in order to be charged for a violation. An individual or entity not otherwise subject to either the anti-bribery or accounting and record-keeping provisions of the FCPA can also be investigated and charged with a violation of either set of provisions.
Except for foreign officials, persons not otherwise liable under the FCPA can be prosecuted for conspiring to violate the FCPA. A conspiracy is established when two or more persons combine or agree to violate a federal statute such as the FCPA. If one member of the conspiracy takes an act in furtherance of the conspiracy before the other indicates withdrawal from the conspiracy, both can be held criminally liable for having entered into the conspiracy.
When a conspiracy to violate the FCPA is involved, no offer or payment needs to be made, no record needs to be falsified, and no system of internal controls need to be circumvented. Nor does it matter that a co-conspirator is a citizen of a foreign nation and beyond the territorial jurisdiction of the United States. It is the agreement to violate the anti-bribery provisions or the accounting and record-keeping provisions that serves as the basis for the criminal charge. The only additional requirement is that there be an overt act by one of the co-conspirators in furtherance of the conspiracy to violate the FCPA.
Liability can also arise out of an individual’s or entity’s involvement as an accomplice under the federal aiding and abetting statute. An aider and abettor can be subject to a statutory violation even if that individual or entity cannot be charged directly with violating the FCPA. Nor is the prosecution of an aider and abettor barred when the principal has been acquitted.
To be liable as an aider and abettor, an individual or entity must act with intent that the offense be committed. An individual or entity need not actually violate the anti-bribery or the accounting and record-keeping provisions. It is the conduct on the part of an individual or entity to assist another party’s violation that serves as the basis for liability as an accomplice.
As a result, a foreign entity that may not be directly subject to the anti-bribery provisions may be exposed to liability as an aider and abettor of an individual or entity subject to the anti-bribery provisions. Similarly, an individual or entity not otherwise subject to the accounting and record-keeping provisions may be exposed to liability under those same provisions as an aider or abettor of an individual or entity subject to the accounting and record-keeping provisions.
As recipients of improper inducements, foreign officials cannot be prosecuted as accomplices under the FCPA. United States v. Castle, 925 F.2d 831 (5th Cir. 1991).
E.g., United States v. Jenkins, 78 F.2d 1283, 1287 (8th Cir. 1996). The agreement need not be formal. United States v. Jackson, 345 F.3d 638, 648 (8th Cir. 2003) (citation omitted). Rather, “a tacit understanding is sufficient, and can be proved by direct or circumstantial evidence.” Id. (citation omitted). “Although not sufficient by itself, association or acquaintance among the [alleged conspirators] supports an inference of conspiracy.” Id. (quoting United States v. Sparks, 949 F.2d 1023, 1027 (8th Cir. 1991)).18 U.S.C. § 371 (2012).
E.g. Woitte v. United States, 19 F.2d 506, 508 (9th Cir. 1927), cert. denied, 48 S. Ct. 84, 275 U.S. 545, 72 L. Ed. 416 (1927).
See, e.g., United States v. York Int’l Corp., Information (D.D.C. Oct 1, 2007), reprinted in3 FCPA REP. 30-257 (conspiracy to commit violate record-keeping provisions in violation of 15 U.S.C. §§ 78m(6)(2)(A), 78m(b)(5), and 78ff, and wire fraud in violation of 18 U.S.C. § 1343).18 U.S.C. § 2 (2012). Based upon the holding in Castle, supra note 1, the recipient of the improper inducements cannot be prosecuted as an accomplice.
E.g., Coffin v. United States, 156 U.S. 432, 15 S. Ct. 394, 39 L. Ed. 481 (1895); In reNofziger, 956 F.2d 287, 290 (D.C. Cir. 1992); United states v. Smith, 891 F.2d 793, 710-11 (9th Cir. 1989), cert. denied, 498 U.S. 811, 111 S. Ct. 46, 112 L. Ed. 2d 23 (1990); United States v. Standefer, 610 F.2d 1076, 1085 (3d Cir. 1979) (en banc), aff’d, 447 U.S. 10, 100 S. Ct. 1999, 64 L. Ed. 2d 689 (1980); United States v. Lester, 363 F.2d 68, 72 (6th Cir. 1966), cert. denied, 385 U.S. 1002, 87 S. Ct. 705, 17 L. Ed. 2d 542 (1967). See also States v. Snyder, 14 F. 554, 556 (C.C.D. Minn. 1882).
Standefer, 610 F.2d at 1088-89.