The Foreign Corrupt Practices Act: It’s Time to Cut Back the Grease and Add Some Guidance

Abstract

Congress enacted the Foreign Corrupt Practices Act to combat an epidemic of illicit payments by U.S. businesses and individuals to foreign officials. The FCPA prohibits any bribe to a foreign official to influence any official act, induce unlawful action, or obtain or retain business. The FCPA, however, carves out an exception for facilitating grease payments made to foreign officials to expedite or secure performance of routine government actions. This exception allows for modest payments to low-ranking officials to expedite non-discretionary clerical activities. The FCPA fails to provide a monetary threshold for what constitutes a permissible grease payment. This Note explains that the carve-out for grease payments impedes the Congressional goal of stamping out corruption. To alleviate the problems associated with grease payments, this Note advocates for Congressional repeal, or amendment of, the statute; DOJ promulgation of guidelines defining permissible grease payments; corporate activism; and institutional reform.