The Foreign Corrupt Practices Act (FCPA) prohibits any U.S. citizen, resident, national, or corporation from bribing foreign politicians or government officials. In the last five years, there have been two noticeable FCPA trends: 1) increased enforcement; and 2) increased sanctions.
FCPA and Indemnification
To avoid personal exposure for any loss, not just losses under the FCPA, directors and officers will first seek indemnification from the corporation under any relevant corporate documents, such as the corporate charter or bylaws, or any employment agreements. If that fails, they will likely turn to directors and officers insurance coverage. Neither indemnity nor insurance, however, may be sufficient to protect a director or officer from personal exposure created by the FCPA.
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