By Innocent Anaba
LAGOS—Socio-Economic Rights and Accountability Project, SERAP, has asked the United States Securities and Exchange Commission, SEC, to establish an efficient case-by-case process for the payment of all US Foreign Corrupt Practices Act, FCPA, civil penalty and disgorgement proceeds for the benefit of the victimised foreign government agencies or the citizens of the affected foreign countries, such as Nigeria.

SERAP said: “Civil society groups in the home country, or US-nonprofit organisations such as the Bill and Melinda Gates Foundation and The Carter Centre serving that country, should be eligible to apply for such proceeds as well, or instead, for use for “public benefit projects” in the affected foreign countries, subject to anti-corruption safeguards.”

The group in a request addressed to Robert Khuzami, Director of the Enforcement Division of SEC, said: “At the moment, the civil penalty and disgorgement proceeds that companies agree to pay to resolve US FCPA investigations are retained by the US government.

“Yet, procurement and investment agreements corrupted by foreign bribery invariably lead to increased costs, not only in higher prices but also in needlessly expanded and ultimately inefficient projects in victimized societies.  This has often been the case in Nigeria, where damage remedies are often elusive.

“Our request would not impede the Division’s enforcement priorities. We are well-qualified to propose and help implement sensible discretionary remedies for victims of FCPA.

“Victimised governmental agencies are typically without a practical remedy for recovering their economic injury attributable to foreign bribery and corruption.  The US FCPA and similar laws in other OECD member states do not provide for private enforcement.

International arbitration, if available under the terms of a contract, and if the home country government even permits a victimized entity to pursue it, is expensive and highly time-consuming, particularly when large multinational companies are defendants.

“While local law can, in theory, provide for a remedy, litigation in the local courts is often fraught with political risk, and can be time-consuming and expensive in the best of circumstances; even if such cases are eventually successful, enforcement of judgments, locally and internationally, present formidable challenges as well.  In SERAP’s experience, all of this is true in the Nigerian context.

“The FCPA not only seeks to ensure that US public companies and their foreign subsidiaries maintain accurate and complete books and records but also seeks, for national security and foreign policy reasons as well, to prohibit virtually all bribery of foreign government officials by individuals and companies subject to US jurisdiction.”