Navigating the FCPA: Understanding the Do's and Don'ts of Doing Business in the United States

 by Temitope Adeniyi Fadeyibi, lawyer and expert in compliance.

It is important for professionals, company managers, compliance department lawyers, and finance department lawyers to understand the laws and regulations surrounding doing business in the United States, particularly with regards to the U.S. Foreign Corrupt Practices Act (FCPA).
The FCPA, also known as "419" in Nigeria, is a federal law that prohibits companies and individuals from bribing foreign officials in order to obtain or retain business. This law applies to any company or individual that is a U.S. person, including foreign companies that are listed on a U.S. stock exchange or that have other significant connections to the U.S. The FCPA also applies to any foreign company or individual that causes, directly or through agents, an act in furtherance of such a corrupt payment to take place within the territory of the United States.
In order to comply with the FCPA, it is important to understand the "do's and don't s" of conducting business in the United States. 
Some key "do's" include:1. Having a robust compliance program in place that includes proper due diligence, record-keeping, and internal controls.2. Conducting thorough due diligence on any third-party agents or intermediaries that may be used in business transactions.3. Providing regular FCPA training to employees, agents, and intermediaries.
Some key "don'ts" to be aware of include:1. Do not make payments to foreign officials or political figures in order to obtain or retain business.2. Do not make payments to third-party agents or intermediaries without conducting proper due diligence.3. Do not falsify books and records in order to conceal corrupt payments.
It is important to note that the FCPA also has a strict liability provision for accounting provisions, which makes it a violation to fail to make and keep books, records, and accounts that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of assets of the issuer.
It is also important to be aware of the various "red flags" that can trigger a compliance issue with the FCPA. These include:
1. Sudden, large, or unusual payments to foreign officials or political figures.2. Payments to third-party agents or intermediaries that are not properly documented or justified.3. Payments to third-party agents or intermediaries that are disproportionately high compared to the services provided.
It is also worth noting that while the FCPA primarily targets corrupt payments to foreign officials, it also has provisions prohibiting companies and individuals from making payments to foreign political parties and candidates. This means that companies must be careful when making contributions or donations to foreign political campaigns or parties, as these can also be considered violations of the FCPA.
Another little known fact is that the FCPA also contains a "facilitation payments" exception, which allows for payments made to foreign officials to expedite or secure the performance of a routine government action. However, this exception is narrowly construed and it is advisable to seek legal advice before making any such payments.
Additionally, the FCPA also has a whistleblower provision that allows for private individuals to file a suit on behalf of the government for violation of the act and also allows for bounties for whistleblowers who provide information leading to FCPA enforcement action. This incentivizes individuals to report any potential FCPA violations they may come across in their business dealings.
It is also worth noting that the FCPA is actively enforced by the Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) and companies can face both criminal and civil penalties for FCPA violations. Moreover, FCPA enforcement actions have been on the rise in recent years, with settlements and fines reaching
In conclusion, compliance with the U.S. Foreign Corrupt Practices Act is of paramount importance for any company or individual doing business in the United States. By understanding the "do's and don't s" of FCPA compliance and being aware of potential red flags, companies and individuals can minimize the risk of FCPA violations and ensure that they are conducting business in compliance with U.S. law.