CEA Anti-Corruption & Bribery Prevention 5 — Questions and Answers
Question 1: Which of the following payments is explicitly exempt from the FCPA's anti-bribery provisions?
- Payments to foreign officials to secure a government contract
- Payments to expedite routine, non-discretionary government actions (facilitation payments) (Correct answer)
- Charitable donations made at a foreign official's request
- Commission payments to agents who are former government officials
Correct answer: Payments to expedite routine, non-discretionary government actions (facilitation payments)
The FCPA contains a narrow exception for facilitating payments made to expedite routine ministerial government actions, though this exception does not exist under the UK Bribery Act.
Question 2: A company hires the child of a foreign minister as an intern with no real duties, in exchange for a government contract. This arrangement is best characterized as:
- Legitimate nepotism with no legal implications
- An indirect bribe through a 'thing of value' provided to a foreign official (Correct answer)
- A permissible internship program supporting community relations
- A facilitation payment exempt under the FCPA
Correct answer: An indirect bribe through a 'thing of value' provided to a foreign official
Providing employment to a family member of a foreign official in exchange for business benefits constitutes a 'thing of value' and likely violates the FCPA's anti-bribery provisions.
Question 3: The UN Convention Against Corruption (UNCAC) differs from the OECD Anti-Bribery Convention primarily because it:
- Focuses exclusively on private-sector bribery
- Covers a broader range of corruption offenses and has near-universal membership (Correct answer)
- Only applies to transnational bribery cases
- Lacks an asset recovery chapter
Correct answer: Covers a broader range of corruption offenses and has near-universal membership
UNCAC is the most comprehensive global anti-corruption treaty, covering domestic bribery, money laundering, asset recovery, and other offenses, with 190+ state parties.
Question 4: Which of the following is the most effective internal control for preventing bribery through third-party agents?
- Requiring agents to sign an annual anti-bribery certification
- Implementing right-to-audit clauses and periodic reviews of agent payments and activities (Correct answer)
- Limiting agents to markets where corruption risk is rated low
- Paying agents on a flat-fee rather than commission basis
Correct answer: Implementing right-to-audit clauses and periodic reviews of agent payments and activities
Right-to-audit clauses combined with periodic reviews allow companies to verify that agents are not misusing funds—certification alone is insufficient without monitoring.
Question 5: In the context of anti-corruption compliance, 'jurisdictional reach' refers to:
- The maximum geographic territory a company may operate in under its license
- The extent to which a country's anti-corruption law applies to conduct occurring outside its borders (Correct answer)
- The number of foreign officials a company may legally interact with
- The scope of a company's internal investigation authority
Correct answer: The extent to which a country's anti-corruption law applies to conduct occurring outside its borders
Jurisdictional reach defines when and how a country can prosecute foreign conduct under its anti-corruption laws, such as the FCPA's broad extraterritorial application.
Question 6: Which action by a company most strongly demonstrates effective compliance program implementation, according to the DOJ's Evaluation of Corporate Compliance Programs (ECCP)?
- Publishing the compliance policy on the company website
- Demonstrating that the compliance program is well-resourced, tested, and updated based on lessons learned (Correct answer)
- Ensuring the General Counsel also serves as Chief Compliance Officer
- Achieving zero compliance incidents over a two-year period
Correct answer: Demonstrating that the compliance program is well-resourced, tested, and updated based on lessons learned
The DOJ ECCP emphasizes that programs must be operationally effective—adequately resourced, subject to testing, and continuously improved—not merely documented.
Question 7: A foreign subsidiary of a U.S. issuer makes a corrupt payment entirely overseas, with no U.S. persons or U.S. dollar transactions involved. Can the parent company face FCPA liability?
- No, because no U.S. nexus exists for either anti-bribery or accounting provisions
- Yes, potentially under the accounting provisions if the subsidiary's books are consolidated with the parent (Correct answer)
- Yes, but only if the parent had actual knowledge of the payment
- No, because FCPA liability requires a wire transfer through a U.S. financial institution
Correct answer: Yes, potentially under the accounting provisions if the subsidiary's books are consolidated with the parent
Even without an anti-bribery nexus, a U.S. issuer that consolidates a subsidiary's financials may face FCPA books-and-records liability if those records are inaccurate.
CEA Anti-Corruption & Bribery Prevention 5
Which of the following payments is explicitly exempt from the FCPA's anti-bribery provisions?