FCPA Guidance: Refined Compliance and Safe Harbors

by Michael Volkov

With all the hype and bloviating behind us, it is now time to take a closer look at some of the more significant aspects of the FCPA Guidance.  For those who continue to carp about the failure of the FCPA Guidance to contain any real “reforms,” I would suggest that your expectations were misguided.  Those who anticipated significant changes to FCPA enforcement were way off the mark and misunderstood the purpose of the FCPA Guidance and the political circumstances surrounding the effort. 

The Justice Department and the SEC have executed a perfect strategy designed to blunt criticism of FCPA enforcement by providing a lengthy explanation as to its enforcement approach.  For practitioners, there are some important safe harbors. 

In the next few posts, I will explore some of the more important issues raised by the FCPA Guidance.

The FCPA Guidance includes an important discussion of the terms “corruptly” and “willfully.”  For compliance officers, this discussion is critical.  As I have frequently written and advised, companies can solve important compliance questions by acting transparently and in good faith. 

With respect to “corrupt” intent, the basic definition is keyed to the actor’s desire to “induce” the recipient to misuse his official position, or to act contrary to an official responsibility or function. 

The term “willful” applies only to individual defendants and not to corporate actors.  (This incongruity was one of the Chamber of Commerce’s suggested reform proposals).  The Supreme Court has repeatedly criticized Congress for using this term which has varied meanings and interpretations depending on the specific statutory context. 

The Supreme Court’s decision in US v. Bryan established an important definition for “willful” which arguably applies to the FCPA context – a “willful act” is one that is undertaken with a “bad purpose,” meaning that the actor does not need to know a specific law the actor is violating, only that the actor is doing something wrong.

With these explanations as guideposts, there are important safe harbors that companies can build to ensure compliance.  When faced with any legal compliance issue, companies need to act in a manner which is inconsistent with criminal intent.  What do I mean?

Criminal actions tend to be carried out secretly to avoid detection and without regard to internal controls which are designed to promote compliance.  When a company takes actions in good faith, they act contrary to such intent.  Companies that adhere to procedures and controls which are aimed at compliance are helping to build a safe harbor.

This approach does not mean that every action or issue considered requires lengthy and costly documentation.  Rather, this approach is designed to prioritize risks and then build safe harbors around such risks.  It is a refined and careful approach to compliance which is aimed at maximizing legal protections while minimizing use of compliance and legal resources.

Once risks are prioritized and systems are designed to address such risks, important protocols need to be developed to protect the company.  Specifically, in the higher risk operations, companies should take steps to (1) document any decision or action; (2) explain the reason for its action (or inaction); and (3) provide a legal analysis which supports its action.  Acting in this manner is inconsistent with “corrupt” and “willful” intent – and therefore negates any inference of criminal intent.

Written by:

Michael Volkov

The Volkov Law Group on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.