Individuals and corporations are subject to both civil and criminal penalties if found to be in violation of the Federal Corrupt Practices Act (FCPA) anti-bribery, accounting, or other provisions. This means not only fines, but the possibility of imprisonment for individuals found in violation of an FCPA provision. It has been established that an employer or principal is unable to incur the fine for the individual found in violation of the act.
The DOJ is responsible for the criminal prosecution of FCPA violations. Under the FCPA, each anti-bribery violation incurs a fine of up to $2 million for corporations or other business entities while individuals receive a lesser, but still hefty, fine and the possibility of time behind bars. The penalty for such a violation by an individual such as a director, officer, or stockholder of the company includes a fine of up to $100,000 and a maximum of 5 years in prison.
Accounting provision violations carry their own penalties as well. For each such violation, the maximum fine is $25 million for corporations or other business entities and up to $5 million for individuals. Individuals are also subject to a maximum imprisonment of 20 years for each offense.
The court has the authority to increase the FCPA-mandated fines under the Alternative Fines Act, 18 U.S.C. 3571(d), up to twice the amount the offender stood to gain through his or her illicit financial transaction, if the fine increase is supported by evidence and the offender pleads guilty or is proven guilty beyond a reasonable doubt.
Civil Penalties may be imposed by both the DOJ and the SEC, based on the authority given under the FCPA. The DOJ is responsible for civil prosecution against violations of the anti-bribery provisions by domestic concerns and those falling under territorial jurisdiction. The SEC, on the other hand, is responsible for civil action taken against issuers, their directors, employees, officers, and the like who violate anti-bribery or accounting provisions of the FCPA.
Each anti-bribery provision violation by a corporation, other business, or individual incurs a maximum fine of $16,000. Each accounting provision violation is penalized based on the specific offense. Based on the nature and scope of the violation, the fine may fall in the range of $75,000 to $725,000 for a corporation or business entity or in the range of $7,500 to $150,000 for an individual. When time to sentence the violator with a penalty, the fine is not to exceed the greater of the specified amount or the value of gain the defendant obtained through his or her violation.
A criminal case carried out by the DOJ may be resolved without resulting in a trial in the case of a negotiated resolution. Such resolutions may include a deferred prosecution agreement, plea agreement, or non-prosecution agreement. For more information about a resolution that can help you avoid a trial, contact an FCPA lawyer.