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Knowledge and Intent

A company can be liable under the FCPA where you are “deliberately ignorant” of the fact or likelihood that corrupt payments are being made on your behalf. Or, given the location, you should have known there was a high probability such a payment would be made.

It is critical to understand that actual knowledge is not a prerequisite for a violation of theFCPA.

Under the FCPA, a person’s actions must be undertaken “corruptly” and/or “willfully”.

  • The word “corruptly” in the FCPA is intended to mean that the offer, payment, or promise of a benefit to a foreign official or an employee of a state-owned or controlled enterprise was intended to influence that person to misuse his or her official position or award you business.
  • The word “willfully” means that the act was committed voluntarily and purposely, with the intent to do something the law forbids; that is, with the bad purpose to disobey or disregard the law.
  • “Knowing” as defined by the FCPA includes conscious disregard and deliberate ignorance of issues that a reasonable person would review before proceeding with a particular transaction.

While the person must have acted with intent to do something the law forbids, model jury instructions used in individual prosecutions have stated that in order to establish willfulness, the person need not be aware of the specific law or rule that his conduct may be violating.

Practice Tips:

  1. Do not make payments to a third party knowing, or with any reason to know, that the payment will end up in the hands of a foreign official or an employee of a state-owned or controlled enterprise.
  2. Conduct due diligence on agents and always have an agreement in place with relevant FCPA language included, with any such third party.