Three weeks after returning to the White House, US President Donald Trump signed an executive order on February 10 directing the Justice Department to pause prosecutions of Americans accused of bribing foreign government officials while trying to win or retain business in their countries.
Trump’s order pauses the nearly half-century-old Foreign Corrupt Practices Act (FCPA) enforcement. It directs Attorney General Pam Bondi to review current and past actions related to the law and prepare new guidelines for enforcement.
The law, enacted in 1977, prohibits companies that operate in the United States from bribing foreign officials. Over time, it has become a guiding force for how American businesses operate overseas.
“It’s going to mean a lot more business for America,” Trump told reporters while signing the order in the Oval Office at the signing.
Interestingly enough, Trump wanted to strike down the FCPA during his first term in office, calling it a “horrible law” and claiming it made the US the subject of the world’s ridicule and derision.
Anti-corruption watchdog Transparency International said the FCPA made the US a world leader in addressing corruption.
Trump’s executive order “minimizes—and could pave the way for eliminating—the crown jewel in the U.S.’s fight against global corruption,” Gary Kalman, executive director of Transparency International US, said in a statement.
The White House factsheet said that in 2024, the Justice Department and the Securities Exchange Commission filed 26 FCPA-related enforcement actions, and by year-end, at least 31 companies were under investigation.
In the initial segment, Philip Rohlik chats with “Regulatory Ramblings” host Ajay Shamdasani about what the Trump administration’s actions will mean for the fight against bribery and corruption in Hong Kong, Greater China, and APAC writ large. They discuss the possibility that with less FCPA enforcement, the UK Bribery Act (2010) might fill the void to some extent while acknowledging that the British Serious Fraud Office lacks the resources of the USDOJ to make extraterritorial enforcement a reality.
Philip also shares his advice on what he would tell compliance officers and in-house/general counsel at banking or financial institutions or major corporations in Hong Kong, Singapore, or Beijing. Hint: Now is not the time to relax.
We then turn to the longer conversation portion of the broadcast, where we examine some of the more global, macro-level effects of President Trump’s recent executive order.
Tom and Malcolm shared their visceral responses when they first heard the announcement that the administration would halt FCPA enforcement. Tom asks why Trump took so long because he had raised similar concerns during his first term (2017-21).
They share their concerns about what it will mean for the global fight against bribery and corruption while acknowledging the limitations of the UK Bribery Act. Still, mainland China’s anti-corruption legislation is worth considering as well.
The conversation concludes with Malcolm and Tom advising the legal and compliance professionals serving financial firms and multinational corporations in Asia, the Middle East, and the world more generally. They concur that now is not the time to slack off regarding anti-graft efforts.
They conclude that the FCPA is still a powerful tool. Given the current president’s vindictive and transactional nature, we might expect selective enforcement of the Act under his administration. Indeed, given experience, it might be inevitable.
Resources:
* Follow Philip Rohlik on LinkedIn | https://www.linkedin.com/in/philip-rohlik-14785411b/
* Debevoise & Plimpton LLP: Webpage | https://www.debevoise.com/
* Follow Tom Fox on LinkedIn | https://www.linkedin.com/in/thomasfox13/
* Compliance Podcast Network: Webpage | https://compliancepodcastnetwork.net/
* Subscribe to Malcolm Nance on Substack | https://malcolmnance.substack.com/
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