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Waters So Deep

There are things we know we don't know, said the former boss at the Pentagon. But then again, he added, there are things we don't know we don't know. That distinction came to mind as we read the latest email from a correspondent who always holds us to a high standard. He said this:

"I, and other readers of the blog, could benefit from a discussion of what distinguishes a criminal violation of the FCPA's antibribery provisions brought by the DOJ from a civil violation of the antibribery provisions brought by the SEC. Of course, prosecutorial discretion is relevant, but I do not see in the statute any distinction between the two (i.e. no additional elements necessary for a criminal charge vs. a civil charge). Compare this to the books and records and internal control provisions which state at 15 USC 78m(b)(4) that 'no criminal liability shall be imposed' for violation of the books and records and internal control provisions except for 'knowing circumvention' or 'knowingly failing' to implement a system of internal controls or 'knowing falsification' of books and records."

Our correspondent said he'd been thinking about this since the SEC charged Halliburton Company and KBR Inc. with civil antibribery violations, while the DOJ charged only Kellogg Brown and Root LLC with criminal violations, even though the SEC's complaint sets forth all the "criminal" elements of an antibribery violation.

So what's the story?

Well, we're stumped. As we told our correspondent, we've read the U.S. Attorney?s Manual 9-28.000 / Principles of Federal Prosecution of Business Organizations (here). But we still don't know how decisions get made by the folks at the DOJ and SEC about who to charge with criminal or civil antibribery offenses. To which our correspondent replied, "From a policy standpoint, you hate to think that whether behavior x is charged civilly or criminally depends on the whim of a prosecutor and not proving additional elements needed to charge a crime."

So here's an invitation to all readers. Tell us, if you know, how decisions are made to charge companies or individuals under the Foreign Corrupt Practices Act with violations of the antibribery provisions either criminally or civilly. Is everything left to prosecutorial discretion? Are there published guidelines? How about unpublished guidelines? Secret handshakes?

To promote this discussion, we've adopted our own Stimulus Plan. The best response -- make that the best several responses -- will earn a copy of Bribery Abroad.

Download the DOJ's criminal information against Kellogg Brown and Root LLC here.

Download the SEC's February 11, 2009 civil complaint against KBR Inc. and Halliburton Company here.
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Full post as published by The FCPA Blog on February 18, 2009 (boomark / email).