NACD Board Leadership Conference NACD Chapter System

The Foreign Corrupt Practices Act: A Trap for the Unwary

December 8, 2015
Princeton, NJ



Join us for some holiday good cheer and hear from our panel of experts about the unexpected developing problems being encountered by American business under the Foreign Corrupt Practices Act.  Topics to be covered include:


  • Why was it enacted?
  • The surprising meaning of "corruption"!
  • Why should both public and private companies be concerned?
  • What are the current "hot areas" of SEC enforcement?
  • What does Company leadership need to do to reduce the risk of falling into this trap?


Ross Miller, Director Flexcon, W.A. Cleary Corporation
Adam Kozielec, Director Advisory Services, KPMG
Neil Schumacher, Paul Hastings


  NJ Dec Recap

Event Notes




On December 8, 2015, a distinguished panel of experts updated the Chapter membership on recent trends under the Foreign Corrupt Practices Act (or FCPA) that was originally enacted in response to foreign bribery scandals during the Nixon administration. Joining Moderator Ross Miller, Chapter Board member and a multicompany director with extensive foreign business experience, were Adam Kozielec, KPMG internal director of FCPA related services, and Neil Schumacher, FCPA compliance attorney in the Washington D.C. office of law firm Paul Hastings.

FCPA includes anti-bribery and internal control provisions. But recent SEC enforcement actions show that neither traditional notions of bribery nor even specific misconduct is necessary for exposure. Simply put, “corruption” isn’t what it used to be!

The statute contains no materiality requirement, so even small amounts that that change hands can be problematic. Anything “given in value” can trigger the statute, such as transfers at less than fair market value. Any act that takes place on US soil in furtherance of the giving of value can be prosecuted, so long as it occurs on foreign soil. Nor does it matter if the company itself is technically the value giver. Acts by foreign subsidiaries or suppliers to foreign subsidiaries can be prosecuted. For example, JP Morgan Chase recently was the subject of an investigation because it allegedly gave a job in New York to the son of a high Chinese official with authority over the bank’s outpost in Hong Kong. And individuals as well as companies can and have been held liable.

Although FCPA is enforced by the SEC, the statute applies to all companies, not just public ones. So the statute should be of concern to directors of both private companies and nonprofits as well. Recent enforcement has gotten more aggressive in recent years, with more than 75 criminal cases brought in the last five years. Frequently small companies without good compliance infrastructure have been targets. Whistleblowers are often the source of information that triggers an investigation.

What can directors do to protect themselves and their companies? It starts with the right “tone at the top,” by making it crystal clear that bribery, no matter how far away from the C suite, will not be tolerated. Good recordkeeping and absolute transparency about where and why money is being spent or value given on foreign soil are key to building an effective compliance program. But if despite these protections, a director becomes aware of something questionable, should it be reported to the authorities? This is a large gray area where good judgement must be exercised.

FCPA is not the only concern directors must have in this area, as other countries, such as the UK, have similar anti-bribery laws and regulations.

Location and Time


Westin at Forrestal Village
201 Village Boulevard
Princeton, NJ 08540

Holiday Good Cheer, Buffet Dinner & Networking 6:30 p.m. - 7:15 p.m.

Program 7:15 p.m. - 8:45 p.m



Question about this Event?

Contact New Jersey Chapter 32 Leonardine Avenue, South River, NJ, 08882 phone: 732-698-7771 fax: 732-698-7772 email: