5 Key Trends in Global Anti-Bribery Enforcement

5 Key Trends in Global Anti-Bribery Enforcement

Share this post

October 15, 2015

It seems the headlines this year have been dominated by one corruption scandal after another, and the resulting enforcement actions. The Global Enforcement Report (the “GER”), published annually by TRACE, summarizes worldwide trends in anti-bribery enforcement. The information is based primarily on investigations and cases tracked in the TRACE Compendium, an online database of cross-border anti-bribery cases. Below are five key trends reflected in the GER that have practical implications for compliance professionals.

  1. Enforcement of anti-bribery laws remains a priority across the globe, not just in the U.S. Companies face the risk of prosecution from U.S. and non-U.S. authorities for violation of anti-bribery laws. While the U.S. leads the world in total number of investigations and enforcement actions, more and more countries are beginning to take action against companies and individuals who have bribed foreign officials. Non-U.S. enforcement actions have more than doubled in the past few years. In fact, in 2014 the number of non-U.S. enforcement actions (15) surpassed the number of U.S. enforcement actions (13). [gap size="20px"]
  2. An increasing number of countries are focusing on bribery of their own government officials. Companies also face the risk of prosecution for violating local anti-bribery laws.  Almost twice as many countries are investigating bribery of their own officials compared to bribery of foreign officials. This may be an upward trend. Countries have brought a number of enforcement actions in the past for bribery of domestic officials; however, according to the GER, there were twice as many ongoing investigations as of December 31, 2014 than those past enforcement actions. Even if only a portion of these investigations results in enforcement actions, the next few years could far exceed the prior rate. [gap size="20px"]
  3. U.S. regulators continue to have non-U.S. companies in their sights. Companies headquartered outside of the U.S. should not overlook their risk of prosecution under the FCPA. As of December 31, 2014, approximately 40% of investigations by U.S. authorities involved non-U.S. companies, and of those the majority were European.  Non-U.S. companies account for almost all of the top 10 largest FCPA enforcement actions, with only two U.S. companies making the list (France now has three companies in the top 10, with the addition of Alstom’s $772 million settlement in 2014). [gap size="20px"]
  4. Anti-bribery enforcement actions are highest in China, Iraq, Nigeria, India, Russia, Brazil and Indonesia. Virtually every country in the world has been impacted by bribery. But operating or doing business in certain countries comes with an increased risk of prosecution for bribery. China, Iraq, Nigeria, India, Russia, Brazil, and Indonesia have seen the highest level of enforcement activity. China took the top spot with Chinese officials having allegedly received bribes in 90 separate enforcement actions. This type of information from the GER and tools like the TRACE Matrix can help companies more accurately assess risk when thinking of expanding business to a foreign country. [gap size="20px"]
  5. The extractive industries continue to have the highest number of anti-bribery enforcement actions worldwide. The extractive industries remain the focus of enforcement activity throughout the world (followed by engineering, manufacturing, and aerospace and defense industries). In addition to the extractive industries, the U.S. has seen a higher number of investigations in the technology, financial services, and entertainment and film industries.

The trends identified in the GER highlight the challenges facing companies in the current enforcement environment, but also provide compliance professionals an opportunity to strengthen compliance programs. With this information, companies can tailor their compliance programs and avoid becoming another enforcement statistic. A version of this piece was originally published by Alexandra Wrage in The Compliance & Ethics Blog.

For more on this topic, please see the following resources:

Global Enforcement Report
TRACE 2014 Global Enforcement Report: Non-U.S. Enforcement Actions Outpace U.S. Enforcement in 2014
A Sea Change in Global Anti-Bribery Enforcement

Gray Mail IconClick here to subscribe to TRACE Trends: A Compliance Conversation and receive email notifications as new posts are published.

New French Anti-Bribery Law Expected in 2016
Guatemala: Corruption Scandals – The Beginning of the End?
Justina Song 5 Key Trends in Global Anti-Bribery Enforcement


Leave a Reply

Leave this field empty:

Your email address will not be published. Required fields are marked *

    FIFA president Gianni Infantino's controversial proposal for a 48-team tournament will come under the microscope when the decision makers at soccer’s governing body discuss the bidding process for the 2026 World Cup this week.
    To read the full article, click...
    Recent News Feed 10/11/2016 Read More
    The U.S. election is drawing near and pundits are turning their attention to the positions candidates might take on less-discussed topics. This includes international corruption and the candidates have, over time, championed very different positions.
    To read the full...
    Recent News Feed 10/6/2016 Read More
    Audits can play a large role in ensuring supply chain compliance. A common safeguard against compliance risks, they are a key element of third-party due diligence. However, audits tend to compete with other business needs, leading to internal debate about the conduct,...
    Recent News Feed 9/30/2016 Read More
    INCONSISTENCIES in the enforcement of legal penalties for businesses engaged in corrupt practices around the world could be one of the main reasons why foreign bribery may be perceived as an attractive investment by some countries,writes Thelma Etim.
    To read the full...
    Recent News Feed 9/20/2016 Read More
    Some GCs say that, in the year since the infamous Yates Memo took effect last September, it has turned in-house counsel into investigators for the DOJ and damaged their credibility with employees.
    To read the full article, click here.
    Recent News Feed 9/8/2016 Read More
    1. What is the current state of corruption in Mexico and what risks does this pose to foreign companies?
    Mexico is ranked 88th out of 197 countries on the TRACE Matrix, which measures business bribery risk by country. With an overall risk score of 54, Mexico represents...
    Recent News Feed 9/2/2016 Read More
    RECENT studies on how bribery undermines business performance highlight the benefits of logistics industry executives taking a strong stance on compliance, warns Russian lawyer Katya Lysova (pictured, below right), an associate at Annapolis-based anti-corruption business...
    Recent News Feed 8/30/2016 Read More
    The Panama Papers have already resulted in fallout for a variety of organizations and high-ranking politicians. As investigators and prosecutors delve further into the cache of leaked documents and governments begin instituting financial reforms, the maritime industry will...
    Recent News Feed 8/29/2016 Read More
    Anonymous shell companies are impressively flexible tools. They can be used to launder money, evade taxation, covertly channel the payment of bribes, stash away a nation’s stolen wealth, and facilitate trafficking in drugs, weapons, and human beings. It’s a...
    Recent News Feed 8/29/2016 Read More
    A strange thing occurred this month in the American political universe when a business organization wrote a letter to several key Congressmen advocating on behalf of a bill that would increase government oversight over companies. Yes, you read that right: companies are...
    Recent News Feed 8/26/2016 Read More
    Shipowners that ‘consciously disregarded’ red flags with respect to their third-party activities can be just as liable for bribery, writes Katya Lysova, associate of member services and advocacy at Trace.
    To read the full article, click here.
    Recent News Feed 8/26/2016 Read More
    TRACE International, a global anti-bribery organization, awarded the OCCRP a prize for investigative journalism on Wednesday for reporting that exposed a billion dollar corruption scandal involving Azerbaijan’s ruling family and Nordic telecommunications giant...
    Recent News Feed 7/21/2016 Read More
    We all know how important it is to conduct meaningful due diligence on third-party intermediaries. While these parties can perform crucial functions for companies seeking to expand their worldwide presence - opening up new markets, providing access to decision-makers,...
    Recent News Feed 7/1/2016 Read More
    Maurice Gilbert: How long has TRACEpublic been in the works? Recent headlines make the need for it apparent, but this is clearly something that takes time to develop.
    Alexandra Wrage:For 15 years, TRACE has been collecting information about true beneficial ownership of...
    Recent News Feed 7/1/2016 Read More