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Business Overseas? Careful It's Not White Collar Crime

White Collar Crime includes foreign crime.  When it comes to punishing major drug companies, the United States government has made it very clear that you can run, but you cannot hide. The Justice Department and the Securities and Exchange Commission (SEC) has spent over three years investigating some of the largest drug manufacturers for violations of the Foreign Corrupt Practices Act (FCPA).

This law allows the U.S. to fine companies for allegedly bribing foreign officials of government-run hospitals. In an effort to have a far-reaching effect to include companies that are based overseas, the Act considers doctors working in these hospitals to be foreign officials.

The end result is the ability for the U.S. to enforce the FCPA on a company like Teva Pharmaceuticals Industries Ltd, an Israeli-based drug manufacturer. The SEC has recently announced that it is looking into whether Teva has violated the FCPA by, among other things, bribing physicians to purchase its medicines. What is so startling about this is that the SEC is focusing on Teva's actions in Latin America, not the U.S.

However, this is not the first time that the actions of a drug manufacturer have been penalized by the SEC. In 2011, Johnson and Johnson paid $70 million in a settlement agreement after it was discovered that its subsidiaries paid Greek doctors who used their surgical implants, and paid doctors in Poland and Romania for prescribing certain drugs.

While recent headlines have focused on drug companies, the FCPA makes it unlawful to bribe a foreign official in an effort to retain or direct business to any one or any business. The law is purposely broad in defining who constitutes a foreign official. Thus, the SEC can wield its power over numerous companies around the world

Not only is this an extreme power granted to the SEC and Justice Department, but it is a lucrative power as well. Through the FCPA, the U.S. can impose fines on almost any company in the world found to be in violation of "bribing" a foreign official. The amount of the fine is determined by how much the violator expects to receive through the use of the bribe.  What the bribe is and how much was given is of no relevance to the SEC and Justice Department. This makes the punishment for this white collar crime completely unpredictable and often a very threatening charge to the business that's been accused.

If you are suspected of committing international crime or violating the Foreign Corrupt Practices Act, contact an experienced criminal defense attorney as soon as possible. Not doing so could mean the difference between a favorable outcome or prison.

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