The Securities and Exchange Commission’s Jon Jordan has published an article advocating a compliance procedures defense under the Foreign Corrupt Practices Act in the Stanford Journal of Law, Business and Finance.
Jordan, a senior investigations counsel in the SEC’s FCPA Unit, notes the existence of an adequate procedures defense under the U.K. Bribery Act, and recommends that a similar defense be added to the U.S. anti-bribery law.
Under the FCPA, the existence of an adequate compliance program won’t help a company escape liability.
“While the existence of adequate compliance procedures would seem important for corporations seeking to comply with the FCPA,” the article said, “such programs are more or less prophylactic measures designed to keep corporations out of trouble with the FCPA, as opposed to any kind of defense to liability under the statute.”
Jordan notes that though the strength of a compliance program isn’t considered when assessing guilt, it is considered when a sentence is decided against an organization accused of bribery.
In the article, Jordan summarizes past attempts by groups and individuals to revise the FCPA to include a compliance defense. He then outlines his own suggestions for a defense.
Such a defense, Jordan said should require that a company have adequate compliance procedures that are adequately implemented. For the defense to be viable, Jordan said any alleged conduct that violates the FCPA should involve conduct that the company did not or should not have known.
In the article, Jordan gives his “Eleven Commandments for an Effective FCPA Compliance Program.”