District Court Creates Limiting Principle for FCPA Enforcement

By Alexander Diamond

In a proceeding related to the Department of Justice’s prosecution of Alstom, a French-based energy company that paid 722 million dollars worth of fines after accusations of corrupt activity worldwide, the DOJ pursued charges against Lawrence Hoskins, a British citizen working with the company in France. Although Hoskins had never lived in the United States and was not accused of furthering any corrupt scheme within United States territory, the DOJ argued that personal jurisdiction existed under accomplice liability theory, as explained in the DOJ’s FCPA guidance policy since 2012. However, the U.S. District Court of Connecticut read the FCPA as prohibiting charges against foreign nationals as Congress chose not to include them within the definition of “domestic concerns” subject to liability (for individuals, the definition entails only citizens, nationals and residents). Although higher courts have not yet reached this issue, the scant case law defining the scope of the FCPA means this ruling could affect DOJ prosecution of foreign citizens for years to come.