Foreign Corrupt Practices Act in New Jersey

Companies have increasingly come under fire for Foreign Corrupt Practices Act (FCPA) violations. According to Bridget M. Rohde and Steve Ganis in “Foreign Corrupt Practices Act (FCPA) Alert: The DOJ’s FCPA Crackdown on the Pharmaceutical and Medical Devices Industry”, on November 12, 2009, Lanny A. Breuer, Assistant U.S. Attorney General in charge of the Criminal Division for the United States Department of Justice (DOJ), was the keynote speaker at the 10th Annual Pharmaceutical Regulatory and Compliance Congress and Best Practices Forum. Breuer stated: “one area of criminal enforcement that will be a focus for the Criminal Division in the months and years ahead [is] the application of the Foreign Corrupt Practices Act…to the pharmaceutical industry.” Not only corporations but also individual executives would be subject to enforcement efforts. On the same day, the Chief of the U.S. Attorney’s Office for the District of New Jersey for the Criminal Division, Charles McKenna, spoke as a panelist at the American Bar Association’s presentation “Current Issues in Medical Device and Pharmaceutical Litigation.” McKenna said the FCPA became the DOJ’s main priority, second to terrorism, and said the medical device industry and the pharmaceutical industry would be subject to DOJ scrutiny.

Violation of the FCPA is a serious crime in New Jersey. In response to illegal political contributions and bribery payments to foreign officials by large corporations in the 1970s, Congress enacted the FCPA in 1977 to prohibit foreign bribery. The FCPA bribery provisions are set forth in 15 U.S.C. §§78dd-1 and 78dd-2. The provisions make it illegal for any company, whether publicly traded or not, to bribe any foreign official for purposes of obtaining or retaining business. A foreign official is any officer or employee of a foreign government or any department, agency, or instrumentality thereof.

In 1988, Congress amended the FCPA to allow for payments that facilitate, expedite, or secure the performance of routine governmental actions. Routine governmental actions are those that are ordinarily and commonly performed by foreign officials. These actions include: (1) obtaining permits, licenses, or other official documents to qualify a person to do business in a foreign country; (2) processing governmental papers, such as visas and work orders; (3) providing police protection, mail pick-up and delivery, or scheduling inspections associated with contract performance or inspections related to transit of goods across country; (4) providing phone service, power and water supply, loading and unloading cargo, or protecting perishable products or commodities from deterioration; or (5) actions of a similar nature.

When charged with a crime, strategize with an experienced New Jersey criminal defense attorney to negotiate reduced sentencing and penalties in return for cooperation or plead not guilty to ensure the prosecution establishes every element of its case.