A HIGH-LEVEL U.S. DEPARTMENT OF JUSTICE
official said in an April 19 speech that
prosecutors are committed to wrapping
up old Foreign Corrupt Practices Act
cases and investigating new ones more
“My intent is for our FCPA investi-
gations to be measured in months, not
years,” said Trevor McFadden, the Jus-
tice Department Criminal Division’s act-
ing principal deputy assistant attorney
general, in what likely was heartening
news for general counsel. “We expect
cooperating companies to work with us
to prioritize internal investigations and
to respond to fraud section requests
promptly to ensure there are no unnec-
The average FCPA case takes more
than four years to resolve, and at least one,
involving Wal-Mart Stores Inc., has been
lingering for nearly six years. McFadden
spoke at the Anti-Corruption, Export
Controls & Sanctions Summit in Wash-
ington, D.C., an annual event sponsored
by law and accounting firms.
If the DOJ does speed up its investigations, that would be good news to
companies caught up in the multiyear,
multimillion-dollar probes. But Mike
Koehler, a law professor at Southern Illinois University School of Law, writing in
his FCPA Professor blog, says that others
at the DOJ have promised speedier processing before, with little success.
FCPA lawyer Audrey Ingram, a partner in the Washington, D.C., office of
Richards Kibbe & Orbe, tends to agree.
“I’ll believe it when I see it,” says Ingram
of the prospect of shorter investigations.
For the most part, McFadden’s talk
followed the usual DOJ line: the high cost
of corruption to companies and countries,
the government’s determination to continue enforcing the FCPA, the desire to
see more companies voluntarily disclose
wrongdoing, and the intention to go after
But Ingram found especially note-
worthy McFadden’s three references to
“leveling the playing field,” especially
regarding the DOJ’s international reach.
“Indeed, there has been growing interna-
tional recognition of the need to disrupt
corrupt payments in order to create a level
playing field in the global marketplace,”
McFadden said in the speech. “I think he’s
saying there is going to be a broader inter-
pretation of the jurisdictional reach of the
FCPA,” Ingram says. “There’ll be a focus
on foreign companies and individuals who
take advantage of the U.S. market.”
McFadden opened his speech with a
reference to his four years in private prac-
tice at Baker McKenzie between stints at
DOJ. “Having worked regularly with gen-
eral counsel and corporate executives, it is
clear to me that the vast majority of inter-
national businesses and business leaders
want to get compliance right,” he said.
“This is quite impressive to compare the
status quo to when the FCPA was enacted
40 years ago, when bribing foreign offi-
cials in order to gain business advantages
abroad was often considered a routine
The status quo may not be as rosy as
McFadden thinks. In a recent EY survey
of Europe, Middle East, India and Africa,
three-fourths of corporate board mem-
bers and senior managers said they could
justify unethical behavior if it would help
their business survive. And 27 percent said
that using bribery to win contracts is a
common practice in their business sector.
FEDS PLEDGE TO SPEED UP CORRUPTION PROBES
The Justice Department’s Trevor McFadden
wants to accelerate FCPA investigations.
RK: I think that you may get a [new] look
at the Foreign Corrupt Practices Act.
There is a view that perhaps the government can do more to assist companies in
deciding how they can conduct business
in jurisdictions where corruption exists.
Companies overwhelmingly aren’t interested in handing out bribes or engaging in
corrupt behavior, but typically they find
themselves operating in countries where
that is the norm or accepted behavior.
There’s a way of giving additional guid-
ance or changing the law in a way that
might strike a balance.
CC: Are there any other areas where we
might see some enforcement changes?
RK: The whistleblower area is one. Obvi-
ously whistleblowers can be very valuable
to the government and to law enforce-
ment. But they are often a mixed bag,
because they sometimes come with mixed
motives and baggage and a fair amount
of self-interest. Some have suggested
that whistleblowers should be required
to go in-house first to report wrongdo-
ing before going to the SEC; they now
have a choice on that. [Some in Congress]
are recommending that you prohibit co-
conspirators from getting whistleblow-
ers awards. That could have a significant
impact because obviously in many cases it
is individuals who are engaged in wrong-
doing who make the best whistleblowers
because they may have the greatest access
to knowledge about the scheme.