November 2011 - The increased scrutiny and enforcement of the FCPA and other anti-bribery laws presents a clear call to action for private equity firms. Here are some of the controls, procedures and training you need to mitigate the risk of violation.
Over the past few years, there has been increased national and international attention directed at bribery and corruption related to business activities that involve government and pseudo-government entities and individuals. This heightened scrutiny has resulted in a greater focus by countries’ regulatory and law enforcement agencies on the financial services industry, including private equity firms.
In the United States, the Foreign Corrupt Practices Act of 1977 (FCPA) sets the national landscape for anti-bribery laws. The FCPA is jointly enforced and prosecuted by the US Department of Justice (DOJ) and the US Securities and Exchange Commission (SEC). Both organizations have increased their pursuit of enforcement actions for FCPA violations, as well as their coordination. As Lanny Breuer, Assistant Attorney General for the DOJ’s Criminal Division recently said “We are in a new era of FCPA enforcement, and we are here to stay.”
In addition to the increased attention in the United States, the international regulatory community has recently bolstered anti-corruption and anti-bribery efforts.
Understanding anti-bribery regulation from both a US and international perspective is an essential element of an effective compliance program.