D. Agency Efforts to Expand FCPA Jurisdiction
- The DOJ and SEC also continue to aggressively stretch the reach of the FCPA.
- In late December 2008, the DOJ and the SEC announced that Fiat agreed to pay $17.8 million to settle alleged FCPA violations arising out of its participation in the UN Oil-for-Food Program. This case represents an excellent example of just how aggressive the US has been in terms of expanding the jurisdictional reach of the FCPA, by prosecuting cases that do not squarely fall within its scope. 19
(a) Fiat and the subsidiaries that were directly involved in the misconduct were non-US companies and almost all of the relevant conduct happened outside the US. The subsidiaries that were in fact responsible for the improper payments were neither issuers nor domestic concerns and, therefore, technically not subject to the proscriptions in the FCPA.
(b) The payments were made to Iraqi ministries and not Iraqi officials. The conduct, therefore, does not violate the anti-bribery provisions of the FCPA.
(c) To avoid these obstacles, the DOJ charged the subsidiaries with conspiracy to commit wire fraud and violations of the FCPA books and records provisions. 20
19 Press release, Department of Justice, Fiat Agrees to $7 Million Fine in Connection with Payment of $4.4 Million in Kickbacks by Three Subsidiaries Under the U.N. Oil for Food Program, http://www.usdoj.gov/opa/pr/2008/December/08-crm-1140.html.
20 See Fulbright Briefing - White Collar Crime and Government Investigations, Fiat To Pay $17.8 million In Oil For Food Settlement (Fulbright & Jaworski LLP, Washington, DC & Houston, TX ), Jan. 2, 2009.