Federal Statutory Liability Flashcards
What does FCPA stand for and what did it do?
Foreign Corrupt Practices Act. Response to illegal foreign bribes.
What are the 2 provisions of FCPA?
- Anti-bribery provisions
2. Accounting provisions
What are the criminal penalties for violating FCPA?
- Individual: max of $100,000 and/or 5 years in jail
- Corporation: max of $1,000,000
What is the civil penalty for violating FCPA?
Max of $10,000
What is the RICO Act and its purpose?
Racketeer Influenced and Corrupt Organizations (RICO) Act. Prevent organized crime’s infiltration into legitimate business.
What are the 4 elements of RICO?
- Conducted/Participated in conduct.
- Of an enterprise.
- Through a pattern.
- Of racketeering activity.
Define “pattern” under RICO.
2 acts of racketeering. Within 10 years. Are related and threaten a continuity of racketeering activity.
What are 2 examples of racketeering activity?
- Mail fraud
2. Wire fraud
T/F The Racketeer Influenced Corrupt
Organizations Act provides for only criminal penalties.
False. The Act provides for extended criminal penalties
and a civil cause of action for organized crime.
What actions are considered a crime under the Sarbanes-Oxley Act with regard to the destruction of evidence?
- Destruction of records
- Willful failure to retain audit review work papers
- Corrupt tampering with documents to be used in
an official proceeding
Describe the Sarbanes-Oxley federal securities crime
provision.
- Defraud any person connected to a public company.
2. Obtain money/property under false or fraudulent pretenses.
Before a RICO file is claimed, what needs to be proven first?
Criminal liability
T/F FCPA does not apply to a company if it does not do business abroad.
False
T/F FCPA’s accounting provisions apply only to SEC-registered corporations
True
T/F As part of SOX, an audit firm needs to be switched every 7 years.
False. SOX did not require rotation of audit firms, only of the audit engagement partner and the reviewing partner and some other key partners.
