Some believe that it is not in the interest of the United States to enforce the Foreign Corrupt Practices Act against non-U.S. companies who have subjected themselves to U.S. jurisdiction.
These views, however, consistently fail to consider the worldwide effects of bribery and corruption on U.S. interests as diverse as the war against terrorism and U.S. commercial interests. These myopic views also fails to consider the direct impact of corruption on U.S. citizens. We are reminded of this in two recent ongoing corruption scandals emanating from Brazil.
The Petrobras scandal has made its way to Texas concerning corruption surrounding the sale of a petro-chemical plant in Pasadena, Texas. Belgian company Astra Oil purchased the refinery in 2005 for $42.5 million, and then sold the refinery to Petrobras in a series of transactions beginning in 2006 for $1.2 billion. It appears Petrobras overpaid for the purchase, and part of this overpayment price was used as funds to pay bribes to corrupt Petrobras officials. The hefty purchase price has prevented the plant, which is one of the highest cited plants for environmental violations in Texas, from maintaining up-to-date pollution controls.
Another developing corruption scandal involves Brazilian meat-packing company J&F Participações, the holding company of meatpacker JBS, concerning allegations that it is at the head of a vast corruption operation to bribe meat inspectors and government officials to get its product shipped out of Brazil into international markets, including the United States. At this point, there is no way to determine which products, if any, shipped into the United States and were not inspected due to bribery and corruption of meat and poultry inspectors engaged by JBS. Like the Petrobras scandal, this type of corruption negatively impacts the United States and its citizens, and it demonstrates why a robust FCPA enforcement regime is in the interest of the United States.