What Is Fcpa?? - Foreign Corrupt Practices Act

Jed is the director of compliance for Geltex, which is a telecommunication corporation, who has decided to expand internationally. After checking through the financial records for the company Jed notices that one of the district managers has increased the amount of monies paid out to the salespeople for commission. As the compliance director this concerns Jed, quite a bit as this would be considered bribery in the U.S.

The Foreign Corrupt Practices Act (FCPA) is a law created to penalize the individuals that are involved in bribing government officials. (Gatti, 2007) This law also prohibits all American based companies from making bribes to keep a business. American businesses are also required by the FCPA law to meet a certain account standards. This law applies to all individuals employed by the company.

The situation that Jed is dealing with at Geletx definitely falls into the guidelines that make the payments unlawful. . The FCPA law does not exclude payments made to foreign persons that are not considered government officials; in fact the law includes any and all employees involved.

If the company is found guilty of violating the FCPA law, they may face charges up to 2 million dollars. With the FCPA law the company and the individuals involved are penalized for their involvement individually. Employees can be fined up to 100,000 dollars and up to 5 years of imprisonment if guilty. Individuals found guilty of violating the FCPA law are required to pay their own fines. Companies are not allowed to pay the fines accumulated by any employee.

References

Gatti, M. M., Ogrady, C. G., & Morgan, O. (2007, January). Foreign Corrupt Practices Act .

Retrieved February 8, 2009, from http://library.findlaw.com/1997/Jan/1/126234.html