Morgan & Morgan
Here’s a tip for potential Foreign Corrupt Practices Act whistleblowers: travel expenses clearly fall within FCPA guidelines.
A FCPA whistleblower is often an employee or insider who often times assumes incorrectly that a bribe only constitutes a violation of the FCPA if actual cash changes hands to an elected foreign official. One common FCPA whistleblower misperception is that a company can always pay for the travel expenses of foreign officials.
This is simply not true.
The FCPA prohibits the payment of “anything of value” but the statute itself does not define this term. The DOJ, SEC and courts have given this language a broad definition to include the standard travel expenses associated with a business trip, including entertainment, meals, airfare, gifts, lodging and drinks. Importantly, there is not a de minimis threshold.
Here are five red flags for travel related FCPA whistleblower violations.
Understand that it is absolutely legitimate and certainly does not violate the FCPA for a U.S. company to pay for the travel expenses of foreign officials – in their capacity as a customer or potential customer - to travel to meet company personnel, inspect products or company facilities, or even to execute a contract. But the payment does potentially become a FCPA violation, however, if it is to cover a non-business expense.