Shifting U.S. enforcement priorities may soon create a crisis in international anti-corruption efforts. For decades, the United States spearheaded those efforts through prosecutions under the Foreign Corrupt Practices Act (FCPA). On February 10, however, President Donald Trump issued an Executive Order pausing enforcement of the FCPA. During the pause, the Justice Department plans to reevaluate the enforcement strategies and presumably approve a new approach that could weaken future U.S. prosecutions. The move will surely create a void that needs to be filled.

Due to the increasingly transnational nature of FCPA prosecutions and the proven models of detection and enforcement endorsed by the Organisation for Economic Co-operation and Development (OECD), liberal democracies across the globe are well equipped to fill that void. They could do it through a sort of “Reverse Marshall Plan” that would have them take the lead in rolling out an effective international anti-corruption regime.

An early sign that they are willing and able came on March 21, when the UK’s Serious Fraud Office, France’s Parquet National Financier (PNF), and the Office of the Attorney General of Switzerland (OAG) announced a new International Anti-Corruption Prosecutorial Taskforce to collaborate on the enforcement of the countries’ wide-reaching anti-bribery laws.

If the UK, France, Switzerland and other countries are committed to aggressive anti-bribery enforcement that includes the best practices of the U.S. FCPA program, anti-bribery enforcement could expand in the years ahead, regardless of U.S. priorities.

FCPA Prosecutions Are Already Transactional

On their face, most current FCPA prosecutions are U.S. cases. In reality, however, they are deeply transnational in nature.

First, non-U.S. citizen-whistleblowers aggressively take advantage of the FCPA’s robust whistleblower law passed as part of the Dodd-Frank Act. Between 2011 and 2021 (the last year statistics were published), over 5,911 non-U.S. citizens from over 135 countries filed claims under the Dodd-Frank whistleblower law that covers FCPA.

Second, successful prosecutions now overwhelmingly focus on foreign companies. Between 2014 and 2024, approximately 71 percent of FCPA sanctions were levied against foreign companies. These sanctions were collected in cases in which the U.S. prosecuted 166 businesses and individuals headquartered outside the United States under the U.S. law, resulting in $21.3 billion in fines paid to the United States by foreign companies. Moreover, according to FCPA Clearinghouse, nine out of the 10 largest FCPA actions – measured by U.S. monetary sanctions per entity group – were against foreign companies. They included the largest FCPA enforcement action ever: a $3.5 billion case in 2016against Odebrecht S.A., a global construction conglomerate based in Brazil, and Braskem S.A. a Brazilian petrochemical company.

At the same time that U.S. cases have increasingly focused on foreign misconduct, foreign law enforcement agencies have worked closely with U.S. authorities to use the FCPA to hold companies in their own countries accountable. The list of foreign authorities that have cooperated with the U.S. on FCPA enforcement matters since 2014 is extensive. In successful prosecutions over the past decade, agencies from sixty-two countries cooperated with U.S. cases and were officially thanked by the United States for their help.

Given the  transnational nature of FCPA-style enforcement, it is a small step for countries with weak anti-bribery laws, or a lack of political will to fully enforce them, to alter their policies and fill the void created by changes to U.S. policies.

The OECD Has Provided a Strong Foundation

Since 1997, the OECD Anti-Bribery Convention has been adopted by forty-six countries, including the United Kingdom, Switzerland, Japan, South Korea, Canada, Australia, and every country in the European Union. Each has passed its own version of the FCPA. The convention lays the foundation for an effective transnational anti-bribery regime, with the potential for far larger jurisdictional reach and impact than the current U.S.-based FCPA.

Furthermore, the OECD has completed detailed audits of the U.S. FCPA program, which offer insights into the successes of its approach.^[1] The OECD closely examined the U.S. law, both its formal legal requirements and how it was being implemented in practice. Its overall conclusions speak for themselves: “The lead examiners commend the United States for its robust detection, reporting and investigation mechanisms.” This “holistic” approach “enable[s]” the United States and other concerned countries to use these laws to prosecute bribery cases “comprehensively with effective, proportionate, and dissuasive sanctions, while also providing legal certainty to the companies involved.”

The OECD attributed the success of the U.S. FCPA to the combination of three basic elements: detection and reporting (i.e. a strong whistleblower law), investigation (i.e. a professional and competent law enforcement or regulatory agency with the legal authority to conduct civil or criminal investigations), and an enforcement process that can issue appropriately large civil or criminal sanctions. These three components need to be incorporated into locally adopted FCPAs.

As to a strong whistleblower law, the OECD audits are clear that the U.S. model of awards works. The auditors identified the U.S. Dodd-Frank Act’s “multifaceted” approach to protecting and encouraging whistleblowers to come forward: “The SEC’s Dodd-Frank whistleblower programme has coincided with obtaining substantial recoveries for the U.S. government. Since the programme’s inception, the SEC has ordered wrongdoers to pay over USD 2.5 billion in monetary sanctions (including more than USD 1.4 billion in disgorgement of ill-gotten gains and interest) in enforcement actions brought with information provided by meritorious whistleblowers.”

By drafting and creating a consensus around best practices to combat international bribery in business transactions, the OECD has successfully completed the first and perhaps hardest step in establishing a truly international anti-corruption program.

Conclusion

Based on the significant jurisdictional reach of countries like the United Kingdom, Canada, Japan, and Australia (all of whom are part of the OECD’s FCPA program), FCPA prosecutions could be expanded if these countries step in where the U.S. is stepping out.

Instead of leveraging the U.S. program and relying on evidence provided by whistleblowers to the U.S. Department of Justice or Securities Exchange Committee, nations could upgrade and invest in their own programs. Significantly, FCPA enforcement (along with enforcement of related laws such as anti-money laundering statutes) have been highly profitable for the United States, bringing in billions of dollars a year from enforcement cases. It would be shortsighted if democracies, when upgrading their laws and initiating their own FCPA prosecutions, did not also ensure that the sanctions paid by wrongdoers are commensurate with United States levels.

Under a Reverse Marshall Plan for anti-corruption, the United Kingdom, the European Union, and other democracies can become the leaders in ensuring that bribery does not corrupt international markets. These countries would have the ability to police corporations headquartered in the United States, just as the United States has policed numerous companies headquartered in Europe and the United Kingdom.

The OECD Anti-Bribery Convention, and the numerous FCPA laws already on the books, create a powerful foundation to strengthen existing anti-corruption laws. Modernized and enforced FCPAs can generate billions in income, while holding anyone who pays or receives a bribe accountable. If they can find the will, European and other democracies can reverse any setback in anti-corruption enforcement.

ENDNOTE

^[1]  The OECD audits demonstrate that the United States has, by far, prosecuted the most FCPA cases and obtained the largest verdicts.  The results for other countries have been mixed.  For example, the OECD’s most recent monitoring report for France confirmed that France was making “notable progress in enforcing its foreign bribery” laws, and between October 2012 and July 2021 had filed 14 cases, imposing sanctions on “19 individuals and 23 legal persons.”  See, https://www.oecd.org/en/publications/implementing-the-oecd-anti-bribery-convention-phase-4-report-france_2c7d8500-en.html. But Canada’s prosecutorial history has been far less rosy: “. . . enforcement of the foreign bribery offence remains exceedingly low 25 years after the adoption of [Canada’s anti-bribery law], considering the size of Canada’s economy and the industrial sectors in which its companies operate. Since the entry into force of the [law] in 1999 . . . conclusion of foreign bribery cases with sanctions remains scarce, with only two individuals convicted for foreign bribery and four companies sanctioned,” https://www.oecd.org/en/publications/implementing-the-oecd-anti-bribery-convention-phase-4-report-canada_a063fdd3-en.html.

This post comes to us from Stephen M. Kohn, a partner in the law firm of Kohn, Kohn and Colapinto and an adjunct professor at Northeastern University School of Law. It is based on his working paper, “A Reverse Marshall Plan for Anti-Corruption: Liberal Democracies Can Fill the Void Left by The Changes in U.S. Policies,” available here.