Aggressive Fcpa Enforcement Getting Mixed Results

The government has been both aggressive and expansive in its enforcement of the Foreign Corrupt Practices Act. However, it has encountered challenges that demonstrate the difficulties presented by these complex cases. U.S. authorities have been able to expand the scope of the FCPA in settled cases involving corporations, but have suffered significant setbacks when trying to enforce it against individuals who prefer trial to settlement.

For non-U.S. defendants, the FCPA requires the government to establish territorial jurisdiction. Enforcement authorities have staked out an aggressive interpretation of this term by reaching out to capture wire transfers between foreign parties using foreign banks that “cleared” through those banks’ U.S. dollar correspondent accounts. In 2011, the DOJ relied on correspondent account liability as the basis of jurisdiction in several cases.

U.S. authorities recently posited a new area of jurisdictional basis: U.S.-based e-mail accounts. In an action brought against Magyar Telekom, the DOJ’s sole claim to anti-bribery jurisdiction was based on a foreign official’s U.S.-based email address, whereby email was “passed through, stored on, and transmitted from servers located in the U.S.”

In June 2011, the court found no territorial jurisdiction where a DHL package was sent from the U.K. to a government informant in the United States. Given the unique facts of the situation – a shipment solicited by the government and delivered to the government – it remains to be seen whether this ruling will establish a strong enough precedent to influence future cases.

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