by Michael Connor

U.S. Attorney General Eric Holder told an audience in Paris on Monday that the prosecution of individuals for violations of the Foreign Corrupt Practices Act “is accelerating” amidst continuing evidence of transnational bribery and corruption.

Holder_AG_FeatureNoting that the U.S. has prosecuted 80 individuals for FCPA violations since 2004, the attorney general said, according to his prepared remarks: “Let me be clear, prosecuting individuals is a cornerstone of our enforcement strategy because, as long as it (bribery) remains a tactic, paying large monetary penalties cannot be viewed by the business community as merely ‘the cost of doing business.’  The risk of heading to prison for bribery is real, from the boardroom to the warehouse.”

The U.S. has also prosecuted 37 different corporations for foreign bribery-related offenses since 2004, levying criminal penalties in excess of $1.5 billion, Mr. Holder added.   Most of those cases have been resolved through so-called deferred prosecution agreements in which the companies avoided criminal charges by agreeing to pay fines and penalties and to make changes in their business practices.

“Our FCPA prosecutions have resulted in remedial efforts by many companies, such as enhanced compliance programs to detect and deter foreign bribery,” Mr. Holder said.  “The way those companies do business has changed – permanently and for the better.”

Speaking to an audience of officials from countries in the Organisation for Economic Cooperation and Development (OECED), Mr. Holder said the World Bank estimates that more than one trillion dollars in bribes are paid each year out of a world economy of 30 trillion dollars.  “That’s a staggering three percent of the world’s economy,” he said.  “And the impact is particularly severe on foreign investment. In fact, the World Bank estimates that corruption serves, essentially, as a 20-percent tax.”

While praising the OECD’s efforts to adopt anti-bribery regulation, Mr. Holder noted that many of the organization’s 38 member countries have no criminal prosecutions to date.  “This is not because bribes are not paid by companies in these OECD countries,” he said. “It is because investigating and prosecuting corruption is difficult, requiring more will, resources, experience, and effort than most crimes.”  He called on those countries to step up enforcement actions “by prioritizing the prosecution of corruption, no matter where the evidence leads.”

File Photo: U.S. Justice Department