Reporting FCPA Violations and Other Crimes Abroad

International businesses and ministries face a variety of challenges, not least of which is discerning and reporting various crimes—from financial fraud to child abuse. A previous blog post covered why and how to report crimes to the FBI. This post will discuss what types of suspected crimes you might need to report, then review some of the appropriate jurisdictions and agencies responsible.

What Crimes to Report

The FBI pursues cases involving a host of national and international “white-collar” crimes, including:

• Falsification of financial information, such as false accounting entries, misrepresentation of financial condition, or illicit transactions designed to evade regulatory oversight;
• Self-dealing by corporate insiders, including insider trading and tax fraud; and
• Fraud in connection with any otherwise legitimately-operated mutual hedge fund, such as falsification of net market values and certain market timing schemes.

Additionally, the Foreign Corrupt Practices Act (FCPA) prohibits the use of bribes to foreign officials in gaining or retaining business and contains requirements for bookkeeping transparency. In addition to U.S. law on foreign corrupt practices, you may need to keep track of stringent laws from other countries, such as the U.K. Bribery Act of 2010.

Other crimes that will likely need to be reported include:

• Child abuse, exploitation, and pornography;
• Internet harassment;
• Human trafficking or sexual assault of any kind;
• Bomb threats or internet trafficking of explosive devices or weapons; and
• Intellectual property crimes such as copyright piracy, trademark counterfeiting, and theft of trade secrets.

Jurisdiction

For the most part, only a legal process can determine whether a crime has actually been committed, so before reporting a suspected crime, it is important to know what jurisdiction or agency it falls under.

Depending upon the scope of the crime, it may need to be reported to appropriate law enforcement agencies at the local, state, federal, or international level. For local reporting, you should refer to local laws, and should work with local counsel to determine complexities such as defining the crime or statute of limitations. In the case of international business, you will usually need to report in the country in which the suspected crime occurred, but you may also need to report in the home country of the business or individual.

For instance, for reporting child abuse or bribery in the United Kingdom, use the U.K.’s laws, even if the event happened overseas. For reporting in the United States, use U.S. law. It may sometimes be desirable to report in countries where the crime did not occur—for instance, the U.S. federal Protect Act permits prosecution of sexual crimes against children by U.S. citizens overseas. And even if there is no prosecution, it may be helpful to flag that someone could be an offender.

In some cases, specific agencies exist to deal with certain crimes. For example, the Securities and Exchange Commission is responsible for enforcing the accounting provisions of the FCPA, and the anti-bribery provisions are enforced by the Department of Justice. The FBI’s Internet Crime Complaint Center (IC3) handles a wide range of domestic internet crimes, from hacking and password trafficking to internet fraud to child pornography and exploitation.

The FBI’s International Operations Division is the primary agency responsible for combating international terrorism, organized crime, and cyber-crime, and for handling general criminal matters, especially those that threaten United States citizens abroad. FBI personnel serve under the authority of the Department of State and U.S. embassies; they carry out justice in accordance with executive orders, statutes, treaties, Attorney General Guidelines, FBI policies, and interagency agreements.

At times, it may be useful to report crimes to an embassy or consulate, or to a licensing board (such as a medical licensing board), even for crimes that occurred overseas.

Conclusion

As with any legal matter, there is often ambiguity surrounding a suspected crime, both with respect to whether an action is considered a crime, and as to whether an agency can take jurisdiction over the crime. In order to decide whether something should be reported to the authorities, enlist the assistance of legal counsel to determine whether the alleged actions, if true, would be considered a crime in the concerned jurisdiction, whether reporting it will be possible, and whether there are other implications to consider, such as safety. Legal counsel will need to be aware of international law but may also need to work with local counsel.

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Featured Image by Rebecca Sidebotham.