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expensive gifts. Like the domestic bribery statute, the FCPA does not contain a minimum threshold amount for corrupt gifts or payments.* Indeed, what might be considered a modest payment in the United States could be a larger and much more significant amount in a foreign country. Regardless of size, for a gift or other payment to vio- late the statute, the payor must have corrupt intent—that is, the intent to improperly influence the government official. The corrupt intent requirement protects companies that engage in the ordinary and legitimate promotion of their businesses while targeting conduct that seeks to improp- erly induce officials into misusing their positions. Thus, it is difficult to envision any scenario in which the provision of cups of coffee, taxi fare, or company promotional items of nominal value would ever evidence corrupt intent, and neither DOJ nor SEC has ever pursued an investigation on the basis of such conduct. Moreover, as in all areas of federal law enforcement, DOJ and SEC exercise discre- tion in deciding which cases promote law enforcement pri- orities and justify investigation. Certain patterns, however, have emerged: DOJ’s and SEC’s anti-bribery enforcement actions have focused on small payments and gifts only when they comprise part of a systemic or long-standing course of conduct that evidences a scheme to corruptly pay foreign officials to obtain or retain business. These assessments are
necessarily fact specific.
Cash
The most obvious form of corrupt payment is large amounts of cash. In some instances, companies have main- tained cash funds specifically earmarked for use as bribes. One US. issuer headquartered in Germany disbursed cor- rupt payments from a corporate “cash desk” and used off- shore bank accounts to bribe government officials to win contracts.” In another instance, a four-company joint ven- ture used its agent to pay $5 million in bribes to a Nigerian political party.” The payments were made to the agent in suitcases of cash (typically in $1 million installments), and, in one instance, the trunk of a car when the cash did not fit
into a suitcase.”!
Gifts, Travel, Entertainment, and Other Things of Value
A small gift or token of esteem or gratitude is often an appropriate way for business people to display respect for each other. Some hallmarks of appropriate gift-giving are when the gift is given openly and transparently, properly recorded in the giver’s books and records, provided only to reflect esteem or gratitude, and permitted under local law.
Items of nominal value, such as cab fare, reasonable meals and entertainment expenses, or company promo- tional items, are unlikely to improperly influence an off- cial, and, as a result, are not, without more, items that have resulted in enforcement action by DOJ or SEC. The larger or more extravagant the gift, however, the more likely it was given with an improper purpose. DOJ and SEC enforce- ment cases thus have involved single instances of large, extravagant gift-giving (such as sports cars, fur coats, and other luxury items) as well as widespread gifts of smaller items as part of a pattern of bribes.” For example, in one case brought by DOJ and SEC, a defendant gave a govern- ment official a country club membership fee and a genera- tor, as well as household maintenance expenses, payment of cell phone bills, an automobile worth $20,000, and lim- ousine services. The same official also received $250,000 through a third-party agent.”
In addition, a number of FCPA enforcement actions have involved the corrupt payment of travel and entertain- ment expenses. Both DOJ and SEC have brought cases where these types of expenditures occurred in conjunction with other conduct reflecting systemic bribery or other clear indicia of corrupt intent.
A case involving a California-based telecommuni- cations company illustrates the types of improper travel and entertainment expenses that may violate the FCPA.* Between 2002 and 2007, the company spent nearly $7 mil- lion on approximately 225 trips for its customers in order to obtain systems contracts in China, including for employees of Chinese state-owned companies to travel to popular tour- ist destinations in the United States.” Although the trips
were purportedly for the individuals to conduct training at
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