K2 Global Consulting

“The Justice Department has been vigorously enforcing the Foreign Corrupt Practices Act and achieving strong results,” Associate Attorney General Lanny A. Breuer said in a speech earlier this month in Washington, DC. “We are in the middle of our fourth FCPA trial of the year – more than in any prior year in the history of the Act.  And just two weeks ago, we secured the longest prison sentence – 15 years – ever imposed in an FCPA case.”

Breuer’s enthusiasm is echoed in statistics from 2010, a year that saw Justice bringing 46 new criminal cases and the SEC filing 26 actions of its own. All together, enforcement case rose 85% from 2009 to 2010—and investigations touched companies of all shapes and sizes from little-known firms to mainstays like Blackstone and Citigroup.

Rooting out bribery as a business practice around the world is no longer an American obsession. With the addition this July of the UK’s very stringent Bribery Act, there is a whole new level of risk for investments made in either direction. Sovereign Wealth Funds that have made investments in the United States are facing new levels of scrutiny—including having foreign employees considered government officials. And there are now greater risks for US firms that want to make investments abroad.