A company that does not perform adequate due diligence prior to a merger or acquisition may face both legal and business risks. Perhaps, most commonly, inadequate due diligence can allow a course of bribery to continue—with all the attendant harms to a business’s profitability and reputation, as well as potential civil and criminal liability. In contrast, companies that conduct effective FCPA due diligence on their acquisition targets can evaluate more accurately each target’s value and negotiate for the costs of the bribery to be borne by the target. Equally important is that if a company engages in the suggested actions, they will go a long way toward insulating, or at least lessening, the risk of FCPA liability going forward.
