President Donald Trump signed an executive order on Monday directing the Department of Justice (DOJ) to pause enforcing a nearly half-century-old law prohibiting American companies and foreign firms from bribing officials of foreign governments to obtain or retain business for 180 days.
This pause includes halting new investigations and reviewing existing ones. The order aims to reassess FCPA enforcement policies to enhance American economic competitiveness and national security.
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The Foreign Corrupt Practices Act (FCPA) was enacted for the purpose of making it unlawful for certain classes of persons and entities to make payments to foreign government officials to assist in obtaining or retaining business. This includes all Americans, and certain foreign issuers of securities, and, according to a 1998 amendment, foreign firms and people who caused such bribes to take place within the United States.
The broadly written law applies not only to direct bribes that are paid, but also to bribes that are offered or planned or authorized by a company’s management. Trump claimed that it “sounds good, but hurts the country.”
“Many, many deals are unable to be made because nobody wants to do business, because they don’t want to feel like every time they pick up the phone, they’re going to jail,” Trump said, elaborating on the matter. A White House official also said: “A pause in enforcement [is necessary] to better understand how to streamline the FCPA to make sure it’s in line with economic interests and national security.”
Presently, both individuals and corporations can be prosecuted under the FCPA. Violators of the FCPA face a maximum possible criminal sentence of 15 years in prison and a maximum fine of $250,000, or three times the monetary equivalent of the thing of value demanded by a foreign official.
The DOJ in 2024 announced enforcement actions in 24 cases related to alleged violations of the FCPA, and There were 17 such enforcement actions announced in 2023.
One prominent case includes the indictment of Indian billionaire Gautam Adani, founder of the Adani Group, and several associates. In November 2024, Adani and seven top executives were charged in the United States District Court for the Eastern District of New York for allegedly orchestrating a scheme to pay over $250 million in bribes to Indian government officials to secure solar energy contracts. The indictment includes charges of conspiracy to violate the FCPA, securities fraud, wire fraud, and conspiracy to obstruct justice.
This case is among the significant FCPA enforcement actions undertaken by the DOJ in 2024, highlighting the department’s commitment to combating international corruption and holding individuals accountable for violating U.S. laws.
Will the charges on Gautam Adani be dismissed?
Trump’s executive order could have significant implications on Adani’s case. The DOJ is now mandated to review ongoing FCPA cases, which may lead to delays or potential reassessment of the charges against Adani and his associates. Legal experts suggest that the outcome will depend on the DOJ’s review and any subsequent policy changes.
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It’s important to note that while the executive order pauses FCPA enforcement, it does not automatically dismiss existing charges. The DOJ retains discretion over ongoing cases and may choose to proceed based on the specifics of each case and the forthcoming revised enforcement guidelines.
President Trump’s executive order introduces a period of uncertainty for the Adani Group’s legal situation in the U.S. The ultimate impact will hinge on the DOJ’s actions following its review of FCPA enforcement policies.
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This is the latest among the numerous executive orders issued by President Trump ever since he took office. Previously, he issued executive orders concerning a number of issues, from immigration, to electric vehicles and cryptocurrency.