John Tredennick
For companies that do business outside the United States, the good news is that the number of enforcement actions under the Foreign Corrupt Practices Act tapered off over the last two years, after a dramatic surge in cases from 2007 to 2010.
The bad news is that this tapering does not mean that the government is any less serious about FCPA enforcement. Even though the number of actions has dropped, the U.S. government continues to strengthen and institutionalize its FCPA investigation and enforcement operations.
The most recent evidence of this came in November with "A Resource Guide to the U.S. Foreign Corrupt Practices Act," a 120-page guide to the law's coverage and enforcement produced jointly by the U.S. Department of Justice and the U.S. Securities and Exchange Commission.
Business leaders are right to be worried, Assistant Attorney General Lanny A. Breuer said in a November 2010 speech. "We are in a new era of FCPA enforcement and we are here to stay."
Nor is the U.S. alone in these efforts; governments across the globe are making new commitments to combat corruption. In 2011 alone, the United Kingdom put into effect a sweeping new anti-bribery law and China enacted changes to its anti-bribery law that made it a criminal offense to pay bribes to government officials outside of China and to nongovernment officials. Thirty-nine countries, including Russia, have signed the Organisation for Economic Co-operation and Development's Convention on Combating Bribery of Foreign Officials in International Business Transactions.
Whether you are a U.S. or foreign-based business, the message is the same: Watch out.
What Does This Have to Do with Search?
But what does FCPA and anti-bribery enforcement have to do with e-discovery search? A lot, actually.
FCPA investigations typically involve hundreds of thousands or even millions of documents collected from all over the world. Sometimes, the investigations are initiated after the government issues a complaint. In those cases, counsel have a starting place for their investigation. The government has a good-faith obligation to set forth the basis of its complaint, and that should alert counsel as to the people to interview and the subject matter for their searches.
But it doesn't always work that way. The FCPA imposes liability on an acquiring corporation when mergers occur — potentially making the buyer of a company liable for bribes and other corrupt activities that occurred even before the merger. That is true even if the buyer did nothing wrong.
In that regard, it is a bit like buying a U.S. company that has plants and property: If it later turns out that the property you are buying is contaminated with toxic chemicals, you may be facing expensive Superfund liability. It doesn't matter that you didn't release any pollutants at the new site after you acquired it.
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