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41 Geo. J. Int'l L. 907 (2009-2010)
The Facade of FCPA Enforcement

handle is hein.journals/geojintl41 and id is 915 raw text is: THE FACADE OF FCPA ENFORCEMENT MIKE KOEHLER* The rise in Foreign Corrupt Practices Act (FCPA) enforcement actions has been well documented. Against the backdrop of aggressive enforcement and the resulting multi-million dollar fines and penalties is the undeniable fact that, in most instances, there is no judicial scrutiny of the FCPA enforcement theories. The end result is that the FCPA often means what the enforcement agencies say it means. Be- cause of the carrots and sticks relevant to resolving a government enforcement action, FCPA defendants are nudged to accept resolution vehicles notwithstanding the enforcement agencies' untested and dubi- ous enforcement theories or the existence of valid and legitimate defenses. The end result is often the facade of FCPA enforcement. This article discusses various pillars that contribute to the facade of FCPA enforcement and highlights that the FCPA, during its decade of resurgence, is being enforced like no other law. This article does not argue, or even suggest, that every FCPA enforcement action is unwar- ranted or that no company or individual has ever violated the FCPA. Rather, this article demonstrates that a significant majority of recent FCPA enforcement actions are a facade-including those that allege clear instances of corporate bribery-yet are resolved without FCPA anti-bribery charges. The facade of FCPA enforcement matters. Even though the resolu- tion vehicles typically used to resolve an FCPA enforcement action are not subject to judicial scrutiny and the vehicles do not necessarily reflect the triumph of the enforcement agencies' theories, in the absence of substantive FCPA case law, these privately negotiated resolu- tion vehicles have come to represent defacto FCPA case law. The facade of FCPA enforcement also breeds inefficient overcompliance by risk- averse business actors fearful of enterprise-threatening liability be- cause of the enforcement agencies' untested and dubious theories. Because the factors that contribute to the facade are being modeled by * Mike Koehler is an Assistant Professor of Business Law at Butler University. Professor Koehler runs the FCPA Professor Blog (http://fcpaprofessor.blogspot.com), and his FCPA expertise and views are informed by a decade of legal practice experience at an international law firm during which he conducted FCPA investigations around the world, negotiated resolutions to FCPA enforcement actions with government enforcement agencies, and advised clients on FCPA compliance and risk assessment.@ 2010, Mike Koehler. 907

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