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Anti-corruption In The United States

1. Bribery in the home (private to public)

1.1 The Legal Environment

Multiple federal acts ban bribery of federal officials in various circumstances, but 18 U.S.C. 201 is the most important statute that directly criminalizes federal public corruption. Section 201 is divided into two sections: Section 201(b) criminalizes the payment, offer, and receipt of bribes, and Section 201(c) forbids the payment, offer, and receipt of illicit “gratuity.” Violations of section 201(b) are penalized more harshly than those of section 201(a). Bribery of state and local government officials is prohibited under other federal and state law.

1.2 What does bribery mean?

(a) Bribery (section 201(b))

Bribery is prohibited under Section 201(b) of the Criminal Code. 201(b) requires the prosecution to demonstrate that something of value was corruptly delivered, offered, or promised to a public officer, either directly or indirectly.

b) Illegal Gratuity—Section 201(c)

Illegal official “gratuity” is dealt with in Section 201(c). The prosecution must establish that something of value was provided, offered, or promised to a public officer under 201(c). It is necessary to establish that something of value was demanded, sought, received, accepted, or agreed to be received or accepted by a public authority in the case of the receiver. The illegal gift must be “for or because of any official act performed or to be conducted by such public person,” according to 201(c).

Whereas, illegal gratuity just needs that the unlawful gift be given or received “for or because of” any official conduct. Bribery, unlike illegal gratuity, which can be directed either forward or backward at a past or future official act, necessitates a specific intent to give or receive something of value in exchange for a future official act—in other words, a specific quid pro quo or direct link between the value given and a specific future act.

Bribery and gratuity charges under 201 do not require that an illicit gift be paid or that the purpose of the unlawful gift be reachable. Section 201 forbids behavior that occurs after an offer (in the case of the giver) or acceptance (in the case of the recipient) has been made.

1.3 What does it mean to be a public official?

Bribes and gratuities given or offered to, or received or sought by a public officer are prohibited under Section 201. The phrase “public official” is defined as any of the following:

The prohibitions of Section 201 apply to all “persons who have been selected to be a public official,” not just present public officials. To put it another way, the act covers “any individual who has been nominated or appointed to be a public officer, or [who] has been officially informed that such person would be nominated or appointed.” 201(a) of the United States Code (2).

The definition also establishes that 201 is primarily concerned with federal law, rather than state or local law. Although the US Supreme Court has held that 201 may be used to prosecute corruption of state and local officials, as well as private individuals, who administer federal programs and occupy “a position of public trust with official federal responsibilities,” the definition establishes that 201 is primarily focused on federal, rather than state or local public officials. United States v. Dixson, 465 U.S. 482, 496 (1984).

The statute’s use against solely private business bribery is prohibited by the term of public official in section 201.

1.4 Bribery’s Consequences

The providing or offering of a bribe or gratuity, as well as the accepting of one, are prohibited under Section 201.

Bribery is punishable under Section 201(b) by up to 15 years in jail, a fine of USD 250,000 (USD 500,000 for organizations), or three times the bribe’s value, whichever is greater, as well as disqualification from holding any federal office.

Illegal gratuity is penalized under Section 201(c) by up to two years in prison and a fine of USD 250,000. (USD 500,000 for organizations).

1.5 Contributions from politics

Under Section 201, political contributions are not forbidden. Such contributions are generally lawful in the United States, as they are protected to some extent by the US Constitution, as long as they are made in accordance with federal and state campaign finance laws and regulations (for example, federal laws that impose limitations on how much individuals and organizations can donate to campaigns and political parties). Despite being nominally provided as a campaign contribution, payments given as a quid pro quo for an official act would still be illegal.

1.6 Hospitality expenses are subject to certain restrictions (gifts, travel, meals, entertainment, among others)

Section 201 does not clearly ban hospitality expenses for public officials, such as gifts, meals, or entertainment.

Such expenditures, on the other hand, may be considered “items of value” that, if given or received in order “to influence” or “for or because of” any official conduct (bribery) or “for or because of” any official act (gratuity), may give rise to criminal responsibility under Section 201.

A “item of value” is defined broadly in both the bribery and gratuity provisions of 201, and encompasses anything that has economic or subjective worth to the recipient. As a result, the word comprises not just cash, but also meals, travel, entertainment, other “in kind” commercial gifts, and even gifts with totally subjective worth to the recipient. The question of whether the provider or the recipient acted with corrupt intent is frequently at the heart of assessing whether such activities were legal.

Furthermore, while Section 201 does not directly prohibit hospitality expenses, various federal, state, and municipal rules and regulations restrict how such expenditures can be made to and accepted by public officials. Members of Congress, for example, are bound by the Rules of the House of Representatives and the Standing Rules of the Senate, which govern their travel and receiving of gifts.


2. Bribery in the home (private to private)

2.1 The Legal Environment

Domestic bribery can be prosecuted by the US Department of Justice (DOJ) and the Securities and Exchange Commission (SEC). To prosecute commercial bribes, the DOJ has employed state laws in conjunction with federal laws such as the Travel Act, 18 U.S.C. 1952, and the mail and wire fraud statutes, 18 U.S.C. 1341, 1343, and 1346. Domestic bribery that violate the SEC’s books and records and internal controls rules (the “accounting provisions” – Sections 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act) can be punished civilly by the SEC. Additionally, the SEC has the authority to submit cases of intentional breach of accounting provisions to the DOJ for criminal prosecution.