Mandatory Debarment for FCPA Violations Is a Bad Idea

From law firm Sheppard Mullin, a critical look at the “misguided proposal” to require mandatory debarment for companies that violate the Foreign Corrupt Practices Act:

“… a proposal [requiring mandatory debarment] is completely wrong-headed. Debarment is a severe, forward-looking administrative remedy – the corporate ‘death penalty’ – not a vehicle to ‘boost’ the penalties for past criminal FCPA violations…[D]ebarment is an inappropriate ‘all or nothing’ remedy. Its use might destroy responsible companies – even essential companies – that have thousands of employees and contribute immensely to the economies of the U.S. and the world. That is why debarment should be used only rarely, and only after an extensive review of what prompted the transgression, how the company responded, and other important factors.”

Read the full update, Mandatory Debarment for FCPA Violations? A Bad Idea Whose Time Should Never Come, Sheppard Mullin Richter & Hampton LLP»