Enthusiastic Enforcement, Informal Legislation: The Unruly Expansion of the Foreign Corrupt Practices Act

Abstract

The Foreign Corrupt Practices Act (FCPA) was enactedover thirty years ago to prohibit bribery of foreign officialsby U.S. persons. In the last few years, the Department ofJustice (DOJ) and the Securities and ExchangeCommission (SEC) have dramatically expanded the FCPAthrough a surge in its enforcement. Responding tocomplex developments in law, the global economy, andagency politics, the DOJ and the SEC have brought tentimes as many cases as in prior years, and assessedhundreds of millions of dollars in penalties. At the sametime, the substantive reach of the law has been extendedthrough the increased enforcement. Thus, ad hocenforcement actions, rather than legislation, regulation, or judicial decision, have transformed the FCPA. In theabsence of formal process or reasoned articulation, thescope of the law is currently unclear. Businesses havelittle official guidance in designing effective complianceprograms and may be more likely to violate the FCPA.Unruly enforcement, and the resulting lack of clarityabout what the FCPA requires, may compromise the law'sefficacy. Therefore the DOJ and the SEC shouldencourage compliance by providing clear, generalguidance about the scope of the FCPA. The Articleconcludes with specific questions about the FCPA thatsuch guidance should resolve.