Cautionary Lessons in Analyzing Foreign Misconduct

How to Navigate Claims Involving Potential Extraterritorial White-Collar Crime

The rising enforcement of global anti-corruption legislation has led to overlapping investigations and prosecutions in foreign jurisdictions around the world. U.S. companies with international subsidiaries or affiliates may face commercial claims filed in U.S. courts stemming from overseas activity. To successfully litigate these extraterritorial claims requires a deep understanding of the legal, regulatory and cultural environment of those foreign jurisdictions.

Using parts of Latin America as examples, some areas of potential misunderstandings are:

A history of labyrinthine taxation rules may have created a culture of widespread tax avoidance and evasion, to the extent that what the U.S. might consider outright fraud may be a less serious infraction when viewed in the local context.
Some governmental bodies that publish investigatory audits and reports may or may not directly correlate to U.S. regulatory and enforcement agencies in terms of legal force and judicial standing.
Forms and documentation of business processes may vary widely from U.S. practice and using them without a full understanding of the institutional structures they support may lead to misinterpretation of the actual intent of their authors.

Republished with the permission of the American Bar Association. © Copyright 2019. The views expressed herein are those of the author and do not necessarily represent the views of FTI Consulting, Inc. or its other professionals.