A recent report discussed the EB-5 program in relation to the Foreign Corrupt Practices Act (FCPA). The FCPA is designed to penalize U.S. individuals and businesses whom offer payments as an attempt to gain or retain business from foreign government officials. In this vein, FCPA contains stiff penalties for these bribery actions. The U.S. government takes FCPA violations seriously, which is why EB-5 programs and regional centers need to meet with an EB-5 attorney to ensure that they have the proper policies in place to comply with FCPA regulations.
Avoid These Common Mistakes That Can Lead to FCPA Violations
Regional centers or EB-5 program sponsors need to ensure that their in-country and abroad market teams avoid these all too common pitfalls, which can lead to hefty FCPA violations:
- Avoid providing compensation to government officials and their family.
- Don’t offer to pay for airplane tickets or travel expenses for government officials or their family members.
- Don’t provide compensation to government officials to promote certain deals.
- Avoid engaging an EB-5 attorney, broker, or market maker that is wholly-owned or partially-controlled by a government official or the immediate family member of a government official.
- Avoid paying fees to government officials in the hopes that they endorse investments.
If you plan on marketing your EB-5 deal abroad, then you need to take the necessary precautions to avoid FCPA violations. Make sure that you know the party that you are going to be doing business with. In this vein, ensure that the party is not a government official or the immediate family member of a government official. Finally, make sure that you seek verified legal counsel to ensure that your marketing and sales activities are in line with FCPA regulations, as well as the country where you hope to market your deal.
Working with a trusted EB-5 attorney, such as a member of David Hirson & Partners, LLP can help you to successfully market your EB-5 deal abroad, while avoiding potential FCPA violations. Managing Partner David Hirson is a nationally recognized EB-5 investment immigration attorney with over 30 years of experience. For more information on EB-5 programs and FCPA violations, contact David Hirson & Partners, LLP via phone at 949.383.5358, or email [email protected].