Financial Institutions and the FCPA

The Foreign Corrupt Practices Act (FCPA) prohibits payment of bribes to foreign officials to assist with obtaining or retaining business. It requires companies whose securities are listed in the US to maintain books and records that accurately and fairly reflect their transactions as well as to devise and maintain an adequate system of internal accounting controls. The FCPA Resource Guide states that: In the past, “corporate bribery has been concealed by the falsification of corporate books and records” and the accounting provisions “remove this avenue of coverup.”

FCPA enforcement is a high priority for the Securities Exchange Commission (SEC)

Despite having robust compliance programs in place, Financial Institutions may still encounter legal problems involving FCPA violations. Here are some SEC examples:

• Credit Suisse Group AG – Agreed to pay more than $30 million to the SEC and a $47 million criminal penalty to resolve charges that the firm obtained investment banking business in the Asia-Pacific region by corruptly influencing foreign officials in violation of the FCPA. (7/5/18). • JPMorgan – Agreed to pay $264 million to the SEC, Justice Department, and Federal Reserve to settle charges that it corruptly influenced government officials and won business in the Asia-Pacific region by giving jobs and internships to their relatives and friends. (11/17/16). • BNY Mellon – The SEC charged the global investment company with violating the FCPA by providing valuable student internships to family members of foreign government officials affiliated with a Middle Eastern sovereign wealth fund. BNY Mellon agreed to pay $14.8 million to settle charges. (8/18/15). FULL ARTICLE