Business & Technology

Why should business owners take FCPA compliance seriously?

Corruption is a problem that if not caught early, can damage the integrity and image of your business that you may have worked very hard to cultivate. In the U.S., corruption is no longer tolerated, nor bribery and the U.S. government has channeled all of its efforts to eliminate corruption at all levels of business and public office. Over the years, and since the introduction of the FCPA in 1977, there have been thousands of cases wherein corruption has been uncovered, and fines, and even prison sentences have been issued. Stiff sentences and convictions are used as a deterrent to prevent people from engaging in corruption. It is fair to say that corruption is easier to fight in the U.S. than it is in other countries, where corruption permeates every level and reach of society.

In this article, we will hope to tell you why FCPA compliance, which will be explained in greater detail below, is very important to business owners. Business owners must reduce their risk of being exposed to corruption, avoid becoming involved in it at every turn, and report corruption whenever it occurs and arises. You must remember, being aware of corruption but not reporting it is complicity, which can yield convictions. If you are aware of corruption – you must report it immediately.



  • The Foreign Corrupt Practices Act (FCPA) was introduced to prohibit bribery, corruption, or underhanded deals between U.S. companies and foreign officials, which previous to its introduction, was alarmingly frequent;
  • FCPA compliance programs will serve as a very important tool against corruption and bribery occurring in your business, and will ensure your business is carried out ethically and responsibly;
  • The FCPA requires that companies keep their books meticulously, preserve records, and control their company carefully to ensure no unlawful payments take place;
  • The FCPA was introduced due to a huge increase in global corruption associated with U.S. businesses, and the costs thereof;
  • FCPA compliance can benefit every single level of your business financially and socially;
  • FCPA compliance programs require you to hire legal counsel to advise on instances of corruption. Specialist attorneys will be able to provide an FCPA compliance guide for CEO and business owners. FCPA compliance programs are a great asset to any business.


What is the FCPA?

The FCPA (Foreign Corrupt Practices Act) was first introduced and passed through Congress in 1977. The reason for this was, at that time, because concerns were being raised that widespread corruption was having an impact on the global economy, which looked very bad for the United States. It was first introduced to prevent bribery occurring in international deals wherein foreign officials were bribing American businessmen to acquire high-profit business contracts, although now regulates virtually every instance of reported corruption in the U.S. Companies, in accordance with the FCPA, must look after their records carefully to reduce and detect fraud and bribes.

The growing concern around corruption was certainly not unfounded, and there was, at that time, a lot of corruption taking place. The FCPA, however, has seen levels of corruption reduce significantly. The FCPA allows for criminal and civil enforcement, and since its inception, it has resulted in billions of dollars in fines, sanctions, and the arrest of many corrupt business owners. The FCPA has, to date, proved its worth in both private and public business, and is an invaluable asset to the U.S. government, and to business owners.


How Does Non-Compliance Impact Business Owners?

The FCPA is enforced by government bodies, such as the Securities and Exchange Commission (SEC) and the U.S. Department of Justice (DOJ). These agencies almost exclusively deal with the investigation of corruption and the prosecution thereof. They take FCPA violations gravely and will vehemently pursue and prosecute anybody suspected of being involved in a violation of the FCPA. The reason for this is, both of these agencies understand the economic impact that corruption, even at a small level, can have. Prosecutions under the FCPA in recent years have targeted businesses and individuals.

Non-compliance with the FCPA can risk federal prosecution and sanctions being brought against you as a business owner.


Compliance With FCPA

If you do international business or business with foreign bodies, you are required to introduce compliance programs specifically designed to detect, prevent, and catch out anybody involved in corruption or bribery. If bribery is brought to your attention, you are required to report it immediately to the governing bodies of the FCPA (the DOJ and SEC). By complying with the FCPA, you will be considered favorably in the eyes of federal authorities, which is, of course, something that can do nothing but benefit you.


Why Is FCPA Compliance Important to Business Owners?


Ethical Behaviour

Anti-corruption laws such as the FCPA ensure ethical behavior. As a business owner, you should want ethical behavior at all levels of your business. By adhering strictly to FCPA regulations, you ensure that you send a clear message to every level of your business (and other businesses) that corruption is not tolerated, and any instance of corruption or bribery will instantly be reported, and that the parties involved will certainly be met with prosecution at the hands of the FCPA’s governing bodies and agencies.


Foreign Corruption

By engaging with FCPA regulations, you fight foreign corruption. Unfortunately, many countries in the world have a very relaxed policy to corruption, and in many countries, you can find corruption going all the way up to the top of government. In the U.S., this is unacceptable and not allowed. As a business owner, by engaging with FCPA regulations, you personally take the fight against corruption and give back to the United States, ensuring that the global economy cannot be impacted, and more importantly for you, that the U.S. economy cannot be impacted.


Internal Culture

Not only does FCPA adherence promote ethical conduct, but it promotes a healthy internal culture, wherein no corruption of any kind is tolerated, and it ensures that every level of your business is aware of how wrong corruption is. This means that should any of your employees become aware of the corruption, that they will be far more likely to report it. Having an internal culture of ethical conduct in your business is something you should strive for, and if you have cultivated it, it should be something you are extremely proud of.

With the help of this page, you now hopefully know why FCPA compliance is very important for business owners, and why you, as a business owner, should go out of your way to comply with FCPA regulations. We hope that with this article, you now understand FCPA a little clearer, and are ready to take your own personal fight against corruption.


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