24792: Walker (comment) re: Bribes, etc. -- Foreign Corrupt Practices Act (FCPA)

[sak-pase@bimini.ws]

John Walker <jcfwalker@matraco.com>


Dear colleagues,

Daniel Simidor makes a good point (24769):

"It would help more, instead of sending in the Marines, 
to make it illegal in US courts for US businessmen to
proffer bribes abroad,..."  

In fact such actions are _completely illegal_ under US law!  Surely Daniel and others on this sophisticated email list are aware that the Foreign Corrupt Practices Act (FCPA) of 1977 (http://www.usdoj.gov/criminal/fraud/fcpa.html) makes bribing foreign officials punishable by fines of up to $2 million and prison terms of up to 5 years.  

FCPA specifically prohibits US corporations and citizens from making any "offer, payment, promise to pay, or authorization of the payment of any money, or offer, gift, promise to give, or authorization of the giving of anything of value to any foreign official for purposes of influencing any act or decision of such foreign official in his official capacity." 15 U.S.C. § 78dd-1(a)(1)(A).  FCPA may also apply to foreign nationals involved with US business interests (e.g., 'local agents'). 

In fact the US was 20 years ahead of other developed countries in outlawing such destructive practices.  In 1997 the Organization of Economic Cooperation and Development (OECD) passed the Convention on Combating Bribery of Foreign Public Officials, which generally paralleled FCPA and put most developed nations on the same playing field.  Most European and progressive Asian nations have ratified this convention (http://www.oecd.org/dataoecd/59/13/1898632.pdf) making violation punishable in their courts. 

Beyond the legal issues, paying bribes is demeaning to indigenous officials and just stupid in the long term.  Here is an interesting excerpt from an FBI wiretap of US businessmen involved in a recent deal in Costa Rica:

26 May 2000: ---- begin wiretap transcript --- 

Kingsley: You've known about the closing costs.

King: The one million dollars?

Kingsley: Yeah.

Kingsley: Yeah, what, um, what Pablo had said, was why just pay, pay off the current politicians. Pay off the future ones.

King: That's right. Because we're gonna have to work with them anyway.

Kingsley: And so what he was saying was double, you know, give them more money. Buy the opposition. If you buy the current party and the opposition, then it doesn't matter who's in because there's only two parties. 

King: The thing that really worries me is that, uh, if the Justice Department gets a hold of. Finds out how many people we've been paying off down there. Uh, or even if they don't. Are we gonna have to spend the rest of our lives paying off these petty politicians to keep them out of our hair? I can just see us, every, every day some politician on our doorstep down there wanting a hand out for this or that.

Kingsley: Well, I mean,

King: Think we could pay the top people enough, that the rest of the people won't bother us any. That's what I'm hoping this million and a half dollars does. I'm hoping it pays enough top people. 
---- end wiretap -------

The transcript notes that Kingsley was found dead on 14 October 2000.  

Good businessmen will know better than to pay bribes and good officials do not ask for them.  It's a tough situation in poor countries, but in my experience (almost 5 years) Haitian officials -- not only Government of Haiti (GOH) but also local officials -- are honest and professional people who only want to see positive outcomes for their nation and communities.  This is especially true of the middle-class technocrats, the beleaguered professionals who struggle to keep GOH functioning on a day-to-day basis, regardless of whom is in power.  Too bad we seldom hear about them. 

The big problem comes from US companies and businessmen who arrogantly go into a country like Haiti using the 'top-down' approach (make a deal with the president or prime minister etc... often working through so-called 'elite families').  The only way to stop this is through vigilance.  The US Embassy and FBI can -- and will -- take action against US citizens using corrupt methods.  But they need to know about it.  

Kind regards, 

John Walker
jcfwalker@matraco.com