FCPAméricas Blog

Aiding, Abetting, Conspiracy … Non-U.S. Companies and Individuals … and the FCPA

Author: Matteson Ellis

Non-U.S. companies and individuals should take note. Their actions do not have to occur in the territory of the United States for FCPA enforcement officials to assert jurisdiction over them. They do not even have to pay the bribes themselves to violate U.S. law.

This is because the principles of aiding, abetting, and conspiracy under U.S. law allow enforcement officials to reach non-U.S. entities and individuals in ways many do not expect. Consider the following, as described in the recent FCPA Guidance:

• “A foreign national or company may also be liable under the FCPA if it aids and abets, conspires with, or acts as an agent of an issuer or domestic concern, regardless of whether the foreign national or company itself takes any action in the United States.” FCPA Guidance, p. 12 (citations to settled cases omitted).

• Thus, even if a non-U.S. company takes no actions within the territory of the United States related to a corruption scheme, it can still be subject to jurisdiction under a “traditional application of conspiracy law” and to substantive FCPA charges “under Pinkerton liability, namely, being liable for the reasonably foreseeable substantive FCPA crimes committed by a co-conspirator in furtherance of the conspiracy.” FCPA Guidance, p. 12.

• Non-U.S. companies and individuals “may also be liable for conspiring to violate the FCPA–ie., for agreeing to commit an FCPA violation–even if they are not, or could not be, independently charged with a substantive FCPA violation.” FCPA Guidance, p. 34.

• Moreover, individuals or companies that aid or abet an FCPA violation are as guilty as if they had directly committed the offense themselves. Aiding and abetting is not an independent crime, and the government must prove that an underlying FCPA violation was committed. But if such a crime was committed, any aider and abetter, wherever located, is liable as if they had committed the crime themselves. And, as the Guidance emphasizes, a non-U.S. company or individual may be held liable for aiding and abetting an FCPA violation, even if it did not take any act in furtherance of the corrupt payment while in the territory of the United States. FCPA Guidance, p. 34.

• The United States generally has jurisdiction over all the conspirators where at least one conspirator is an issuer, domestic concern, or commits a reasonably foreseeable overt act within the United States. “For example, if a foreign company or individual conspires to violate the FCPA with someone who commits an overt act within the United States, the United States can prosecute the foreign company or individual for the conspiracy.” The same principle applies to aiding and abetting violations. FCPA Guidance, p. 34.

• Both companies and individuals can be held civilly liable for aiding and abetting FCPA anti-bribery violations if they knowingly or recklessly provide substantial assistance to a violator. FCPA Guidance, p. 34.

• For conspiracy offenses, the government generally need prove only that one act in furtherance of the conspiracy occurred during the limitations period, thus enabling the government to prosecute bribes paid or accounting violations occurring more than five years prior to the filing of formal charges. FCPA Guidance, p. 35.

The FCPA Guidance provides examples on page 45. In Baker Hughes, the non-issuer subsidiary pleaded guilty to conspiring to commit and to aiding and abetting the U.S. parent’s books and records and anti-bribery violations. In Panalpina, a U.S. subsidiary of a non-U.S. company was charged with conspiring to commit and aiding and abetting the books and records violations of its customers, who were issuers.

FCPAméricas asked Mark Rochon about the ways that conspiracy and aiding and abetting charges might compare to substantive FCPA charges. Mr. Rochon is an FCPA attorney who chairs Miller & Chevalier’s Litigation Department, has been lead counsel in more than 160 jury trials, and has argued before appellate courts across the country. We asked him whether, from the perspective of prosecutors, these theories of liability are more difficult to prove. Are there reasons why enforcement officials would be more or less prone to bringing them? Mr. Rochon responded:

Prosecutors love to bring cases with conspiracy theories. Using such theories can be a basis to bring in evidence that might otherwise be difficult to admit. Generally speaking, prosecutors do not have to charge a conspiracy in order to gain the admission of co-conspirators’ statements; however, having a conspiracy charge tends to support the admission of such statements, which can be devastating to a defendant. Moreover, use of conspiracy theories can bring a defendant into a case where it would otherwise appear that substantial jurisdictional challenges would preclude charges against such a defendant. Using a conspiracy theory can also be an effective way for the prosecution to “tell the story” of the alleged offense, and to include a larger cast of perpetrators through whom to tell that story. Also, using a conspiracy theory can be very effective because a conspiracy is proven when a person takes a step, even if not itself criminal, in furtherance of an agreement (which need not be explicit) to commit a crime. No one would ever want to be a defendant in a case including conspiracy theories of liability—they are an extremely effective prosecutorial weapon.

The FCPAméricas blog is not intended to provide legal advice to its readers. The blog entries and posts include only the thoughts, ideas, and impressions of its authors and contributors, and should be considered general information only about the Americas, anti-corruption laws including the U.S. Foreign Corrupt Practices Act, issues related to anti-corruption compliance, and any other matters addressed. Nothing in this publication should be interpreted to constitute legal advice or services of any kind. Furthermore, information found on this blog should not be used as the basis for decisions or actions that may affect your business; instead, companies and businesspeople should seek legal counsel from qualified lawyers regarding anti-corruption laws or any other legal issue. The Editor and the contributors to this blog shall not be responsible for any losses incurred by a reader or a company as a result of information provided in this publication. For more information, please contact Info@MattesonEllisLaw.com.

The author gives his permission to link, post, distribute, or reference this article for any lawful purpose, provided attribution is made to the author.

© 2013 Matteson Ellis Law, PLLC

Matt Ellis

Post authored by Matt Ellis, FCPAméricas Founder & Editor

Categories: Enforcement, FCPA, FCPA Guidance

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