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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

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.


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