Running head: THE FOREIGN CORRUPT PRACTICES ACT OF 1977
The Foreign Corrupt Practices Act of 1977
Dale Moon
The Robert B. Miller College
Philosophy 310
Patrick Purgiel, Instructor
April 17, 2014
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THE FOREIGN CORRUPT PRACTICES ACT OF 1977
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The Foreign Corrupt Practices Act of 1977
Beyond the border of the United States, the act of upholding ethically behavior is not so
commonly expressed in some areas of the world. These unfortunate and unethical interludes
sometimes intertwine into the realm of business. For many the temptation of quick financial gain
regardless of the means is too tempting to pass up. Some domestic corporations and entities
within the U.S. have been guilty of bribing foreign governments in exchange for business within
that country. These actions violate the ethical standards that the United States upholds and
therefore in 1977, the Department of Justice and the Securities and Exchange Commission
establishes the Corrupt Foreign Practices Act, which would enact a law that deemed such
behaviors both unethical and illegal.
While the act of bribing foreign governments and politicians may seem harmless to the
U.S., the consequences that follow are deemed unethical and are therefore unallowable. Most
often the countries at risk for such bribery are third world countries, countries that are lacking the
same technological and cultivated civilization as the United States. Such countries and
politicians are easy targets because not only are they financially vulnerable but they are more
easily corruptible. Because third world countries have much less control and more leniency
within their government with foreign business, a corporation could bribe such entities with more
ease. This in effect can have a disastrous effect on a growing or struggling country. The actions
are deemed unethical and thankfully illegal, because of the lasting and reaching effect they have
beyond the border of the United States.
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The violations for the Foreign Corrupt Practices Act have not yet seen an end. Even
recently there have been many instances where the act has been disrupted. In 2013, the
Department of Justice collected over $600 million in penalties. Within the first of 2014, the DOJ
collected another 300 million in penalties. These penalties come from individual violators and
corporate firms. In August of 2013, U.S. brokers were found guilty of bribing Venezuelan
officials. In 2013 alone, there were violations on nearly every continent. These violations are
typically found within specific sectors of business. James P. Dowden notes that “Although a
large number of actions implicated the oil and gas industries, enforcement agencies also targeted
apparel, technology, financial services, and medical companies.” Even the large business WalMart has been tied to some unsavory activities that would seem to violate the Foreign Corrupt
Practices Act. Reports have arisen of Wal-Mart paying bribes in Brazil, Mexico, India, and
China. Wal-Mart has seen allegations against it for making attempts to cover up previous
behaviors of corrupt activity as well. Therefore it is safe to say that many have been tempted by
the quick and lucrative, unethical behaviors that exist beyond the borders of our country.
The Foreign Corrupt Policies Act of 1977 seeks to not only apprehend violators of the
act, but to instruct future individuals and corporations on what actions in foreign market business
can be taken. As China grows in economic size and strength, many of the U.S. domestic
corporations and firms have been able to find a variation of business ventures with the oncedowntrodden communist regime. Therefore these notes of consideration by the Department of
Justice have been sent to warn about the future businesses with foreign entities. Enacting a firm
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stance about these ventures beyond the border will hopefully help to strengthen future ethical
behavior that individuals, firms, and corporations hope to partake on.
Thankfully it appears that in 2014, any sort of violation of the Foreign Corrupt Practices
Act of 1977 is seen as something of taboo. The business sector has gone through many great
lengths to see that it is unviolated and respectfully followed. The Wall Street Journal offers a
quiz on their web site for business-doers alike to take. This quiz helps individuals to recognize
their own unethical behavior and to realize whether or not a violation of the FCP Act has
occurred. These resources are convenient and extremely applicable to firms because it allows
them to understand to a greater extent what business tactics and strategies are acceptable by law
and which actions would be condemned and penalized by the Debarment of Justice and the
Securities and Exchange Commission.
The business protocol within the United States of America is meant to follow strict
ethical guidelines. Within these guidelines, therein lies the Foreign Corrupt Practices Act of
1977, which was established in order to root out and dismantle unethical acts within foreign
entities. The FCP Act forbids any domestic corporate firms, individual, or other boding entity to
in any way bribe foreign governments, or politicians in the hope of gaining business ventures
with that particular country or region of the world. These acts are unethical and enact potential
dangers and hazards to the regions they do business with. They are heavily penalized by the U.S.
Department of Justice, and have been seen to be acted upon swiftly and appropriately. Therefore
if ever a business would choose to operate across borders within a foreign region, it would do
them well to take the quiz by TheWall Street Journal in order to see that their actions are not in
any way violating the Foreign Corrupt Practices Act of 1977.
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References
Spotlight on Foreign Corrupt Practices Act. (n.d.). SEC.gov. Retrieved from
http://www.sec.gov/spotlight/fcpa.shtml
Tan, B. (2012, January 15). United States: Foreign Corrupt Practices Act of 1977
(FCPA). Foreign Corrupt Practices Act of 1977 (FCPA). Retrieved from
http://www.mondaq.com/unitedstates/x/160976/International%2BTrade/Foreign%2BCor
rupt%2BPractices%2BAct%2Bof%2B1977%2BFCPA
USDOJ: CRM: FRAUD: Foreign Corrupt Practices Act (FCPA). (n.d.). USDOJ: CRM:
FRAUD: Foreign Corrupt Practices Act (FCPA). Retrieved from
http://www.justice.gov/criminal/fraud/fcpa/
Dowden, J. P. (2014, March 31). United States: Foreign Corrupt Practices Act Enforcement
Activity: 2013 Year In Review And 2014 Preview. Retrieved from
http://www.mondaq.com/unitedstates/x/303278/international%2Btrade%2Binvestment/F
oreign%2BCorrupt%2BPractices%2BAct%2BEnforcement%2BActivity%2B2013%2BY
ear%2BIn%2BReview%2BAnd%2B2014%2BPreview
Foreign Corrupt Practices Act Definition | Investopedia. (n.d.). Retrieved from
http://www.investopedia.com/terms/f/foreign-corrupt-practices-act.asp
Polazzolo, J. (2013, July 21). Is it a bribe... or not? Retrieved from
http://online.wsj.com/news/articles/SB1000142412788732402110457855125164057437
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Smith, Gambrell& Russell, LLP. (n.d.). Retrieved from
http://www.sgrlaw.com/resources/trust_the_leaders/leaders_issues/ttl15/836/