FCPA Compliance
Definition
FCPA Compliance
FCPA compliance is the work of meeting the Foreign Corrupt Practices Act, the United States law prohibiting corrupt payments to foreign officials and requiring accurate books. Payments made through agents count, which puts intermediaries at the centre of the work.
The Act dates from 1977 and has two distinct halves that companies often treat as one.
The anti-bribery provisions cover corrupt payments. The accounting provisions cover records and internal controls, and they are enforced far more often because they need no proof of bribery at all.
Enforcement policy has also moved recently — the statute did not change, but the priorities guiding prosecutors did.
Key takeaways
- The Act has separate anti-bribery and accounting provisions with different proof requirements.
- Payments routed through agents are captured by the knowing standard.
- Deliberate ignorance of an intermediary’s conduct does not defeat that standard.
- Enforcement paused in February 2025 and resumed under new guidelines in June 2025.
How it works
The anti-bribery provisions prohibit corrupt payments to foreign officials, made directly or through others. They also reach foreign firms and persons who cause, directly or through agents, an act in furtherance of such a corrupt payment within United States territory.
The knowing standard is what makes intermediaries dangerous. The statute prohibits payments to any person while knowing that all or a portion of such money or thing of value will be offered, given, or promised, directly or indirectly, to any foreign official.
Knowledge is then defined broadly — it is satisfied where a person is aware of a high probability that a circumstance exists, unless that person actually believes it does not, which forecloses the wilful blindness defence.
| Provision | What must be proved | Typical trigger |
|---|---|---|
| Anti-bribery | Corrupt intent and a payment or offer | An agent’s payment to an official |
| Books and records | Inaccurate recording of transactions | A misdescribed consultancy invoice |
| Internal controls | Absence of reasonable assurance | No approval path for third party payments |
| Knowing standard | Awareness of high probability | Ignoring obvious red flags on a partner |
The accounting provisions require companies to make and keep books and records that accurately and fairly reflect transactions, and to maintain an adequate system of internal accounting controls.
That is why an invoice matters — a payment described as “consulting” when it funded something else is an accounting violation whether or not the bribery charge is brought.
Examples
Enforcement histories read like procurement case studies rather than crime reports, because the decisions that created exposure were commercial ones. The arrangements here are routine, which is precisely why they get waved through.
A United States issuer’s sales agent in Asia pays a licensing official. The issuer never authorised the payment, but its records describe the agent’s fee as a marketing expense, which creates an accounting exposure.
A manufacturer’s joint venture partner handles all government relations. The manufacturer declines to ask what a large “success fee” covered, which is the awareness of high probability the statute contemplates.
A logistics company’s local clearing agent makes routine payments to expedite inspections. The payments are small and habitual, and habit is not a defence to either provision.
A technology firm acquires a business with an undocumented agent network. The liability arrives with the acquisition, which is why corruption diligence sits inside transaction work rather than after it.
Related terms
Anti-corruption terms get used interchangeably even though the obligations behind them differ sharply in scope and in consequence. Each of the terms below governs something adjacent rather than something identical.
- ISO 37001: the certifiable anti-bribery management system, distinct from the statute.
- SOX compliance: the financial reporting controls regime that overlaps with the accounting provisions.
- Compliance outsourcing: contracting the compliance function itself.
- Compliance officer: the role accountable for the programme.
- Vendor management outsourcing: where intermediary diligence actually runs.
- Legal outsourcing: the delivery model used for diligence review at volume.
- Risk outsourcing: moving risk work out without moving the liability.
FAQ
Does the Act apply to non-United States companies?
It can. Foreign issuers and persons who cause an act in furtherance of a corrupt payment within United States territory fall within its reach.
What is a facilitating payment?
A small payment to expedite a routine governmental action. A narrow exception exists, but it is interpreted tightly and other countries’ laws may not recognise it.
Can we be charged without proof of bribery?
Yes. The books and records and internal controls provisions stand on their own and are enforced more frequently than the bribery provisions.
Does wilful blindness work as a defence?
No. Awareness of a high probability satisfies the knowing standard unless the person actually believed the circumstance did not exist.
What changed in 2025?
An executive order paused enforcement in February 2025, and the Department of Justice issued new guidelines in June 2025 that resumed it with narrower priorities.
Does outsourcing compliance work reduce exposure?
It can improve coverage. It does not transfer responsibility, which stays with the issuer and its officers.
Browse verified partners in the Outsource Accelerator directory and keep the firms that can name their own subcontractors.
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