SEC Chairman Nominee Won’t Abandon Anti-Bribery Law

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By Andrew Ramonas

SEC chairman nominee Jay Clayton signaled his support for using the Foreign Corrupt Practices Act to combat corruption abroad, calling it a “powerful and effective” tool.

Fighting corruption involving companies and foreign governments is an “important governmental mission,” according to his written answers to questions from Sen. Sherrod Brown (D-Ohio), ranking member of the Senate Banking Committee.

The responses, obtained by Bloomberg BNA April 3, are Clayton’s most extensive remarks on the FCPA since President Donald Trump nominated him in January. Questions about the nominee’s views on the FCPA arose after a 2011 report he helped author was critical of the act. Clayton’s responses to Brown are contrary to views expressed by Trump, who has called the FCPA a “horrible law.”

“Bribery and corruption have no place in society,” Clayton wrote. “Moreover, they often go hand-in-hand with many other societal ills, including inequality and poverty, and have anti-competitive effects, including disadvantaging honest businesses.”

The Senate Banking Committee is set to hold a vote on his nomination April 4.

International Help

Prior to his nomination, Clayton chaired a New York City Bar Association drafting committee that put out a report saying the current anti-bribery regime was causing “lasting harm” to U.S. companies’ competitiveness by placing “disproportionate burdens” on them and incentivizing other countries to take a “lighter touch.”

Clayton, a Sullivan & Cromwell partner, wrote to Brown that U.S. authorities could bolster their anti-corruption efforts if officials in other countries are committed to helping.

“Fortunately, international enforcement efforts appear to be more prevalent than they were a decade ago,” he wrote.

Spokespersons for Clayton and Brown didn’t immediately respond to a request for comment on the nominee’s FCPA plans.

Advising Clients

Clayton’s response to Brown came after the senator asked the nominee at his March 23 nomination hearing whether he would advise a client to do business in a country notorious for corruption. The nominee said he would tell his client to “think long and hard” about problems that may arise before pursuing a business opportunity in such a country.

“I’m hopeful that the standard will be high,” Brown said at the hearing. “We shouldn’t be sending the message American businesses can be so successful partnering with corrupt entities.”

To contact the reporter on this story: Andrew Ramonas in Washington at aramonas@bna.com

To contact the editors responsible for this story: Phyllis Diamond at pdiamond@bna.com; Seth Stern at sstern@bna.com

For More Information

To view Clayton's written responses, visit http://src.bna.com/nBm.

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