Despite the fact that the Foreign Corrupt Practices Act has been in force for decades there is relatively little case law interpreting its provisions. A great deal of the existing interpretation of the Act stems from settlements – the Department of Justice and the Securities Exchange Commission continue to investigate possible violations of the statutes which typically end in some type of a settlement. Those settlements, while not actual case law, become the fabric of the law. This point is clearly reflected in the Guide to the statute issued by the DOJ and the SEC, much of which is the view of the two enforcement agencies as reflected in the cases that have been charged and resolved but not litigated to a court decision.
As more individuals are prosecuted however, the number of litigated cases is increasing. That means more court decisions construing the statute. More court decisions should translate to a sounder basis of interpretation for the statute. The most recent decision of the Second Circuit Court of Appeals rejecting the DOJ’s view on the reach of the statute with respect to foreign nationals is one of those decisions. U.S. v. Hoskins, Docket No. 16-1010-cr (2nd Cir. August 24, 2018).
The indictment centers on a scheme to bribe officials in Indonesia to secure a $118 million contract from the government of that country. Lawrence Hoskins worked for Alstom S.A., a global firm based in France that provides power and transportation services. From 2002 through 2009 Mr. Hoskins was employed by Alstom’s U.K. subsidiary but was assigned to work in another subsidiary, Resources Management in France.
The bribery scheme involved Alstom Power, Inc., Alstom’s U.S. subsidiary based in Connecticut. Alstom U.S., and various individuals associated with the parent firm retained two consultants, according to the charges, to bribe Indonesian officials who could assist with securing the contract. Mr. Hoskins never worked for Alstom U.S in any direct capacity. The indictment claims, however, that he was one of the people responsible for approving the selection of, and authorization of, payments to, the consultants, knowing that a portion of the payments would be used to pay bribes.
Mr. Hoskins is charged with conspiring with the company and its employees, as well as foreign persons, to violate the statue. The dispute here is based on Count 1 of the indictment, alleging that Mr. Hoskins was an accomplice and conspired to violate the law. The objects of the conspiracy correspond with two provision of the FCPA that Mr…