The Foreign Corrupt Practices Act: Two Recent Cases Set New Records, Teach Old Lessons

Article by M. Richard Schroeder and Stephen J. Haedicke

Two recent enforcement actions have set new records for penalties for violations of the U.S. Foreign Corrupt Practices Act ("FCPA"). In the first case, Siemens Aktiengesellschaft ("Siemens") and three of its subsidiaries agreed to pay a total of $800 million in criminal fines and civil disgorgements related to the companies' world-wide practice of bribing foreign officials in aid of business. In the second, the former Halliburton subsidiary Kellogg, Brown & Root, Inc. ("KBR"), agreed to pay a total of $579 million in criminal fines and civil disgorgements for its corrupt actions in securing a series of lucrative construction contracts in Nigeria. These penalties are each many times greater than any penalty previously imposed under the FCPA. Together, they demonstrate the seriousness with which U.S. enforcement authorities continue to pursue corporate bribery world wide.