American companies often rely on mining, manufacturing, and banking operations in foreign countries. Most of the time, these operations operate legally. But when scarce resources intersect with lucrative business opportunities, these companies sometimes resort to bribing foreign officials to gain a competitive advantage. Even though this misconduct takes place on foreign soil, it can still violate U.S. law.

In a recent series, the New York Times has highlighted one area in which bribes may become increasingly common. This series investigated the impact of the “green energy revolution,” in which businesses and governments are attempting to transition away from the use of fossil fuels by using ever-improving battery technology that proponents hope will someday power entire cities.

These sophisticated batteries, however, require materials found in only a few places on Earth: lithium, cobalt, and rare earth metals. Their scarcity has set off “a familiar cycle of exploitation, greed and gamesmanship” in which state governments and private companies jockey for control of precious resources.

In the Democratic Republic of Congo, for example, where nearly seventy percent of the world’s cobalt is produced, “a wave of adventurers and opportunists” have arrived “to do business in a country with a reputation for labor abuses and bribery.” These investors are seeking to acquire or partner in mining interests owned by the Congolese government, with billions of dollars at stake. The risk of bribery and corruption is high. Albert Yuma Mulimbi, the former “chairman of a government agency that works with international mining companies to tap the nation’s copper and cobalt reserves,” has been accused of brazen corruption, “abus[ing] his position to enrich friends, family members and political allies.”

Meanwhile, “[e]ight foreign companies have been competing in recent months to establish pilot lithium projects” in Bolivia, which has a quarter of the world’s known lithium. These companies are aggressively lobbying the Bolivian government for access to the country’s lithium deposits, much of which has been unextractable until recent technologies were developed.

The Green Energy Revolution and the FCPA

These business ventures carry the promise of extraordinary profit, but they also carry the risk of widescale corruption. As companies attempt to gain control of scarce mineral reserves, they may be willing to pay bribes to government officials to gain an advantage over their competitors. This behavior may run afoul of the Foreign Corrupt Practices Act (FCPA).

The FCPA prohibits individuals or companies from paying bribes to foreign officials for assistance in obtaining or retaining business. The FCPA doesn’t just apply to businesses headquartered in the United States. The U.S. Securities and Exchange Commission (SEC) has jurisdiction over any company that issues securities on American exchanges—such as American Depository Shares traded on the New York Stock Exchange. Thus, even foreign companies—such as Petróleo Brasileiro S.A., which recently paid $850 million to settle claims that it facilitated bribes to Brazilian government officials—can be held liable under the FCPA.

The FCPA Whistleblower Program

Whistleblowers are essential in helping the government identify and punish violations of the FCPA. Whistleblowers whose information leads to a successful enforcement action may be eligible for monetary awards. If the SEC collects monetary sanctions over $1 million, the whistleblower may receive between 10% and 30% of the amount the government collects. Anyone can report an FCPA violation, not just a U.S. citizen. It is important to partner with an experienced whistleblower attorney who can help you put together the strongest case and maximize your recovery.

Federal law provides whistleblowers with important protections. Whistleblowers reporting FCPA violations can remain anonymous as long as they are represented by an attorney. Retaliation against whistleblowers is prohibited, and if a whistleblower is unlawfully retaliated against by their employer, they can receive reinstatement, back pay, and other compensation.

Most whistleblowers are current or former employees of the company committing an FCPA violation. Other whistleblowers are individuals who have been harmed by the fraud committed by the violator, those who work in the same industry as the violator, or individuals who have personal relationships with the violator.

Contact Baron & Budd

With more than 30 years of experience, the attorneys on Baron & Budd’s whistleblower representation team have represented dozens of clients in government fraud cases returning over $6.0 billion to federal and state agencies, with whistleblower recovery shares as high as 49%. They are ready to help if you have evidence of an FCPA violation.