Anti-Corruption and Anti-Bribery Compliance Flashcards

Which U.S. federal law prohibits American companies and their agents from bribing foreign government officials to obtain or retain business?

Answer: The Foreign Corrupt Practices Act (FCPA)

The Foreign Corrupt Practices Act (FCPA) of 1977 specifically prohibits U.S. persons and entities from bribing foreign government officials for business advantages.

Under the FCPA, which of the following is NOT considered a 'foreign official'?

Answer: A private sector executive with no government role

The FCPA's definition of 'foreign official' covers government employees, officials of state-owned enterprises, political party officials, and candidates for office, but does not include purely private-sector individuals.

What are 'facilitating payments' (also called grease payments) under the FCPA?

Answer: Small payments to low-level officials to expedite routine, non-discretionary government actions

Facilitating payments are small payments to minor officials to speed up routine government actions (e.g., processing permits), and the FCPA contains a narrow exception for them, though many other laws do not.

The UK Bribery Act 2010 differs from the FCPA in which significant way?

Answer: The UK Bribery Act prohibits commercial bribery between private parties, in addition to bribery of public officials

Unlike the FCPA, the UK Bribery Act covers both public and private sector bribery, making it broader in scope and including a separate offense for failure of commercial organizations to prevent bribery.

Which affirmative defense is explicitly available under the FCPA anti-bribery provisions?

Answer: The payment was a reasonable and bona fide business expenditure directly related to promoting products or services

The FCPA provides an affirmative defense for reasonable and bona fide promotional expenditures, provided they are lawful under the written laws of the foreign country.

In an anti-corruption compliance program, what is the primary purpose of conducting third-party due diligence?

Answer: To assess the corruption risk posed by agents, distributors, and other intermediaries acting on the company's behalf

Third-party due diligence is critical because the FCPA and similar laws hold companies liable for bribes paid through intermediaries who act on their behalf, making risk assessment of such parties essential.

A company operating in a high-risk country discovers that its local sales agent has paid a bribe to a government official to win a contract. Under FCPA enforcement principles, which factor most significantly mitigates the company's exposure?

Answer: The company had a robust compliance program, promptly self-disclosed, and cooperated fully with authorities

DOJ and SEC guidance emphasize that a robust pre-existing compliance program, voluntary disclosure, and full cooperation are the most significant mitigating factors in FCPA enforcement decisions.