Watergate Special Prosecution Force Created…The Birth of the FCPA


On November 2, 1973, the Watergate Special Prosecution Force was established in the Department of Justice. For those of you too young to remember, the Watergate scandal began with the arrest of five men for breaking and entering into the Democratic National Committee (DNC) headquarters at the Watergate complex in Washington D.C. on June 17, 1972. The Federal Bureau of Investigation (FBI) connected cash found on the burglars to a slush fund used by the Committee for the Re-Election of the President, a fundraising group for the Nixon campaign. It appears that the slush funds had not been used just for domestic political contributions, but also for paying bribes to foreign government officials with an eye to landing contracts abroad. According to an article in the Wall Street Journal, “Stanley Sporkin, the SEC’s enforcement director from 1974 to 1981, had watched the Watergate hearings on television and was curious about how the companies had booked the illegal contributions. Digging further, he and his staff found that some companies also dipped into the secret funds to pay off foreign officials, with an eye to landing contracts abroad.”

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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