Introduction
President Trump’s Executive Order (“EO”) and the United States Department of Justice’s (“DOJ”) Guidelines for Investigation and Enforcement of the Foreign Corrupt Practices Act (“Guidelines”) (“FCPA”) begin a new era in FCPA enforcement. The FCPA Executive Order and the Guidelines, however, do not address how the Securities and Exchange Commission (“SEC”) will civilly enforce the FCPA. That is, the SEC is an administrative agency that operates independently of the DOJ and the President.
To influence SEC policy, Trump signed two new executive orders limiting the functions and budgets of all regulatory agencies and departments within the US Government. This article discusses how Trump’s FCPA Executive Order on enforcement dated February 18th, 2025, the DOJ’s New FCPA Guidelines, and the Executive Order of February 19th, 2025, are being used to rein in the SEC’s civil enforcement of the FCPA.
This discussion is divided into four parts. Part I provides a brief overview of Trump’s FCPA Executive Orders and the new DOJ Guidelines on FCPA enforcement. Part II explains how Trump’s February 18th and February 19th, 2025 Executive Orders have been used to curtail the SEC’s ability to carry out FCPA investigations and enforcement. Part III explains the challenges facing US companies due to the SEC’s new approach to FCPA enforcement and provides US companies with recommendations how to deal with FCPA compliance under Trump. Part IV explains challenges facing non-US companies in response to the SEC’s changes in FCPA enforcement and European authorities’ recent efforts to step up cross-border antibribery enforcement.
- Trump’s Executive Order Pausing FCPA Enforcement and DOJ’s New Guidelines Affecting SEC Enforcement of the FCPA
On February 10, 2025, President Trump issued an Executive Order titled “Pausing Foreign Corrupt Practices Act Enforcement to Further American Economic and National Security”. Trump’s FCPA Executive Order represented a dramatic shift in FCPA enforcement philosophy. The February 10th Executive Order declared that the FCPA: “has been systematically, and to a steadily increasing degree, stretched beyond proper bounds and abused in a manner that harms the interests of the United States.” The Executive Order states that FCPA enforcement over the years “impedes the United States’ foreign policy objectives and therefore requires the President to exercise his Article II authority over foreign affairs to limit the scope of FCPA investigations. Rather than viewing FCPA enforcement as preventing bribery and corruption around the world, the Trump Administration believes that FPCA enforcement is an overreach by the US Government that harms the economic interests of the United States and US corporations abroad.
On June 9, 2025, the United States Department of Justice issued its new Guidelines. Under the new Guidelines, the DOJ’s FCPA enforcement will focus on four main areas when evaluating potential FCPA enforcement actions and prosecutions: (1) Total Elimination of Cartels and Transactional Criminal Organizations; (2) Safeguarding Fair Opportunities for US Companies; (3) Advancing US National Security Interests; and (4) Prioritizing Investigations of Serious Misconduct as opposed to “Routine Business Practices.” The February 10, 2025, Executive Order and the new DOJ Guidelines do not apply directly to the SEC’s FCPA enforcement because the SEC is an administrative agency that is independent of the office of the President. But they signal to the SEC how the Trump Administration wants the SEC to proceed with FCPA civil enforcement.
- Trump’s Executive Orders Limit the SEC in its FCPA Enforcement
Two Executive Orders were issued by President Trump that directly and significantly have affected the SEC’s ability to conduct civil investigations and civil prosecution of the FCPA. They were issued on February 18th and 19th 2025.
The February 18th Executive Order requires all federal agencies, including the SEC: (1) to work with directors of the Office of Management and Budget (“OMB”), White House Domestic Policy Council, and the White House National Economic Council; (2) to create the position of White House Liaison for their agencies and departments; (3) for directors of OMB to establish performance standards and objectives; and (4) for the President and Attorney General to provide interpretations of law for the Executive Branch.
The February 19th, Executive Order requires agency heads to work with the Department of Government Efficiency (“DOGE”) and the Director of OMB to implant the related Executive Orders.
The SEC has changed its FCPA policy in response to the Executive Orders. On July 15, 2025, the SEC dismissed its civil prosecution of Gordon Coburn and Steven Schwartz, two former executives from Cognizant Technology Solutions, for allegedly authorizing a $2 million bribe to Indian officials to obtain permits for the construction of a 2.7 million square-foot Cognizant Office in Chennai, India. The SEC dismissed the case against Coburn and Schwartz, with prejudice. This followed the DOJ’s decision in April 2025 to drop its criminal charges against Coburn and Schwartz. The SEC states that its decision to withdraw the civil prosecution was a policy-based move and was not based on the merits of the allegations.
The SEC has recently closed other FCPA investigations:
(1) SEC froze its FCPA probe of Calavo Growers, Inc. – 3/2025
(2) SEC closed its FCPA probe of Inotiv, Inc. – 6/2025
(3) SEC closed its FCPA probes of a GE healthcare spinoff in China – 7/2025
The SEC leadership has signaled a reduction in enforcement activities in areas outside “core” areas, including investigation and prosecution under the FCPA.[1] The SEC has indicated that its policy on FCPA enforcement will be consistent with that of the DOJ. This is a dramatic policy shift from the SEC’s more aggressive FCPA enforcement of previous administrations. The SEC is more likely to decline enforcement actions against companies that cooperate with investigations and that remediate conduct.[2]
- Challenges Faced by US Companies Due to SEC’s New Approach to FCPA Enforcement and Recommendations
Based on the new Executive Orders, the new DOJ Guidelines and actions taken by the SEC to terminate several existing SEC civil investigations, clearly FCPA investigations and prosecutions during the remainder of the Trump Administration will be substantially curtailed.
The SEC’s civil investigation and prosecution will focus mainly on the four areas established under the DOJ’s new FCPA Guidelines and as specified above.
Unless bribery and violations of the FCPA touch on one of these four main areas, the SEC will not open a civil investigation nor prosecute. Because the Executive Orders and the DOJ FCPA Guidelines limit the SEC’s independence and budget to investigate possible FCPA violations, there is a disincentive for employee-whistleblowers to report their companies’ violations. That is, if the SEC does not investigate and establish a violation, employee-whistleblowers will not receive incentive bonus payments under the SEC whistleblower program.
But the FCPA remains the law of the United States, irrespective of how the Trump Administration may choose to enforce it in the next several years. Under the FCPA, the statute of limitations for violations is five years, while record-keeping violations have a six-year statute of limitations. US companies engaging in international business will face uncertainty regarding how the next administration will handle FCPA violations, and they should avoid the risk of facing both civil and criminal prosecution due to lax oversight. For US companies with technical violations, it is recommended that they consider using the existing self-reporting framework with the SEC and the DOJ to enter into non-prosecution agreements and to receive leniency in penalties to avoid prosecution should the next administration return to prosecution of FCPA violations.
- Impact of the New Executive Orders and DOJ Guidelines on FCPA Enforcement Against Non-US Companies
The SEC’s FCPA enforcement against non-US listed companies may become more aggressive. The Trump Administration’s clear directive to the SEC is not to enforce FCPA violations against US companies unless they fall within the four focus areas, and especially where enforcement would “harm the national interest of the US,” and impede “economic development and foreign policy objectives of the United States.” The Trump Administration’s clear directive to the SEC (and the DOJ) is to enforce the FCPA where enforcement would constitute “safeguarding fair opportunities for US Companies,” and “advance US national security interests.”
Non-US companies listed on US stock exchanges must maintain rigorous self-monitoring, training, internal audits, and investigations concerning potential FCPA violations. Non-US companies should be wary of their US competitors who may find it beneficial to report non-US competitors.
That is, non-US companies may face an uncertain future of FCPA enforcement during the Trump Administration. They must worry about the Trump Administration’s policy to favor US corporations over non-US corporations by targeting FCPA investigation of foreign companies over US companies.
Even after the Trump Administration, there will be exposure. The statute of limitations for FCPA violations is five years, and the statute of limitations for failure to keep records under the FCPA is six years.
Furthermore, non-US corporations must also be concerned about their own countries’ and regional authorities’ enforcement of the FCPA. Immediately after Trump’s executive order paused FCPA enforcement in February 2025, on March 20, 2025, the United Kingdom, France, and Switzerland announced the formation of a new International Anti-Corruption Prosecutorial Task Force (“Task Force”) to deal with cross-border prosecution. The Task Force announced that it is committed to combat international bribery and corruption around the world wherever it occurs. Leaders in the United Kingdom, France, and Switzerland have already urged the European Union, Commonwealth of Global South countries, and the OECD to increase support for the OECD Working Group on Bribery to strengthen the United Nations Convention Against Corruption. While the Task Force can mobilize against corrupt activities by companies from their own countries, they could also target US companies, to offset what may be seen as the Trump Administration’s targeting of non-US companies.
It remains to be seen whether European authorities or the OECD will have the will or the resources to fill in the vacancy in FCPA enforcement left by the SEC and the DOJ. They may, themselves, and in retaliation, prosecute US corporations for FCPA violations. In any event, non-US corporations should be concerned about European authorities or OECD stepping up their own cross-border antibribery enforcement.
Conclusion
There are reasons why both US corporations and non-US corporations engaged in international business must prioritize compliance with the FCPA despite changes in enforcement of the FCPA. Although FCPA investigations by the SEC may slow due to limitations on investigations and cuts in SEC budget, corporations now have a unique opportunity to self-report technical violations and negotiate favorable outcomes, such as non-prosecution agreements with the SEC and DOJ. The change in focus creates a challenging environment. That is, US corporations can report their European competitors’ FCPA violations to gain a competitive advantage. Non-US corporations, especially those in Europe, should also be concerned that European authorities will step into the void left by the DOJ and the SEC to enforce cross border antibribery laws.
[1] O’Connor, R.D. Debunk, J.R., Okoji, C, & Matthews, N.P. (2025 May 23), SEC Speak 2025: Key Takeaways from Division of Enforcement Panels. Ropes & Gray.
[2] Lawrence, A.M. & Herilihy, C.S. (2025 April 30). SEC Enforcement Policies Suggest a Return to Basics. Skadden Arps, Slate, Magher & Flom.
Nguyen Hong Thai
