California Attorney General Reminds Public: FCPA Violations Still Enforceable Under State Law

Recently, California Attorney General Rob Bonta emphasized that the Foreign Corrupt Practices Act (FCPA) violations are still actionable under California state law. This move serves as a reminder to businesses that making improper payments to foreign government officials to gain or retain business is illegal and punishable under California’s Unfair Competition Law (UCL) even if federal enforcement of the FCPA is currently paused.

The UCL in California aims to uphold fair business competition and consumer protection by prohibiting illegal business practices. It grants private individuals the right to take legal action against violators and allows state and local prosecutors to bring civil enforcement actions against companies engaged in illegal or fraudulent practices. The UCL has previously been used to address a variety of violations, including false advertising, consumer fraud, and antitrust issues. Moreover, the California Supreme Court highlighted in 2003 that a UCL claim can be based on FCPA violations.

President Trump’s executive order in February 2025 directed the temporary suspension of FCPA investigations and enforcement to reevaluate enforcement priorities. While this shift may impact federal oversight, California Attorney General Bonta stressed the state’s commitment to combating corruption within its jurisdiction. He reaffirmed that bribing foreign officials remains illegal under California law, echoing the state’s dedication to upholding ethical business practices regardless of federal actions.

In light of potential gaps in federal anti-corruption oversight, state attorneys general across the country are gearing up to bolster enforcement efforts in various critical areas. With the Department of Justice halting FCPA enforcement and uncertainty surrounding Securities and Exchange Commission actions, state and local authorities are stepping up to fill enforcement voids. This includes conducting thorough investigations and coordinating joint efforts across multiple states, leading to more comprehensive and extensive examinations that could prove burdensome for companies.

Attorney General Bonta’s message to businesses is clear: illegal activities, such as paying bribes to foreign officials, are intolerable and have serious implications, not just ethically but also from a business perspective. Despite federal changes in enforcement priorities, companies are advised to maintain robust internal controls and effective compliance programs to deter and detect corrupt practices. Developing risk-based compliance programs that consider the regulatory landscape at the local and state levels is critical to mitigate potential risks and ensure legal compliance moving forward.

As state AGs gear up for stepped-up enforcement efforts, companies are urged to assess their exposure to anti-corruption risks at the state level and bolster their compliance programs accordingly. This proactive approach can help companies navigate the evolving enforcement landscape and avoid legal and financial repercussions resulting from non-compliance with anti-corruption laws.