Question 1

Brendon Inc.required a permit to open its business in the country of Cadmia.Although it had met all the requirements for the permit,the officials concerned delayed providing Brendon Inc.with the permit.To expedite the process,the company made a payment to a customs official.Which of the following types of payments is this an example of?

Accepted Answer

The payment made by Brendon Inc. to expedite the process of obtaining the permit is an example of a facilitation payment. Facilitation payments are small bribes or payments made to officials to speed up or facilitate routine governmental actions, such as obtaining permits or processing paperwork. While facilitation payments are prohibited in some countries, they are legal and common in others, including Cadmia.

Question 2

Prior to the passing of the Foreign Corrupt Practices Act,unethical corporate behavior was regulated by the _____,which required full disclosure of funds that were taken out of or brought into the United States.

Accepted Answer

The Bank Secrecy Act regulated unethical corporate behavior before the passing of the Foreign Corrupt Practices Act. This act required full disclosure of funds that were taken out of or brought into the United States. The Dodd-Frank Wall Street Reform and Consumer Protection Act and the Consumer Protection Act are both laws that were passed in response to the financial crisis of 2008 and were not in effect prior to the passing of the Foreign Corrupt Practices Act. The Securities and Exchange Commission is a regulatory agency responsible for enforcing securities laws, but it did not specifically regulate unethical corporate behavior prior to the Foreign Corrupt Practices Act.

Question 3

In what way do bribes differ from grease payments under the FCPA?

Accepted Answer

Bribes are meant to induce officials to act in violation of their lawful duty, while grease payments are used to expedite routine governmental actions. The FCPA allows for grease payments, but prohibits bribes.

Answer: B 
 Bribery involves offering or giving something of value to influence an official, while grease payments are small payments made to expedite routine governmental actions. Donations to bona fide charitable organizations are not considered bribes or grease payments under the FCPA.

Answer: C 
 Bribes are used to secure a routine governmental action, while grease payments are used to expedite the same. The FCPA allows for grease payments, but prohibits bribes.

Answer: D 
 Bribes are used to facilitate processes that are not approved of by law, while grease payments are used to expedite routine governmental actions that are otherwise lawful. The FCPA allows for grease payments, but prohibits bribes.

Question 4

The Foreign Corrupt Practices Act:

Accepted Answer

The Foreign Corrupt Practices Act encompasses all the measures that were previously in use to curb unethical overseas transactions. It was enacted in 1977 to prevent US companies from bribing foreign government officials to secure business advantages.

Question 5

Payments made with the knowledge that any portion of the payment is to be passed along to a foreign official for a prohibited purpose under the Foreign Corrupt Practices Act are known as _____.

Accepted Answer

Payments made with the knowledge that any portion of the payment is to be passed along to a foreign official for a prohibited purpose under the Foreign Corrupt Practices Act are known as bribes. Grease payments and facilitation payments are legal forms of payment under certain circumstances, while black funds are unreported or hidden funds.

Question 6

Why was the Foreign Corrupt Practices Act criticized?

Accepted Answer

The Foreign Corrupt Practices Act has been criticized for formally recognizing the concept of facilitation payments. While some argue that these payments are necessary to conduct business in certain countries, others view them as a form of bribery.

Question 7

Bribes are those payments which:

Accepted Answer

Bribes are payments made to induce officials to act in violation of their lawful duty, which is illegal and unethical.

Question 8

Which of the following is a routine governmental action?

Accepted Answer

Providing police protection for the transit of goods across a country is a routine governmental action aimed at maintaining law and order and protecting the interests of citizens and businesses within a country.

The other options are not routine governmental actions and can potentially involve unethical or illegal practices. Allocating funds for facilitation payments, accepting payment in return for an exclusive contract are forms of corruption, while providing legal immunity for foreign company employees may lead to impunity and a lack of accountability for possible wrongdoing.

Question 9

Which of the following is true of the Foreign Corrupt Practices Act?

Accepted Answer

The Foreign Corrupt Practices Act (FCPA) is violated even if a bribe was unsuccessful, as it prohibits the offer or promise of a bribe, not just the successful exchange.

Question 10

The _____ refers to legislation introduced to control bribery and other less obvious forms of payment to overseas officials and politicians by American publicly traded companies.

Accepted Answer

The Foreign Corrupt Practices Act (FCPA) was introduced to control bribery and other less obvious forms of payment to overseas officials and politicians by American publicly traded companies. The Comstock Act had to do with obscenity laws, the Rehabilitation Act addresses discrimination against disabled individuals, and the Equal Opportunity Act prohibits discrimination in education and training programs.

Question 11

Payments to foreign officials in order to expedite or secure the performance of a routine governmental action are known as _____.

Accepted Answer

Payments made to foreign officials to expedite or secure the performance of routine governmental actions are known as 'grease payments'. Induced payments, insulated payments, and allurements are not commonly used terms in relation to this concept.

Question 12

Which of the following is true of facilitation payments under the Foreign Corrupt Practices Act (FCPA)?

Accepted Answer

Facilitation payments, also known as "grease payments," are payments made to expedite or secure the performance of routine government actions. While the FCPA does not formally recognize them or differentiate between them and bribes, it permits facilitation payments if they involve routine governmental actions, such as issuing permits, licenses, or visas. However, facilitation payments cannot be used to secure new business or contracts for a company.

Question 13

Which of the following did the government formulate to penalize corporate wrongdoing?

Accepted Answer

The Sarbanes-Oxley Act was formulated in 2002 and is aimed at penalizing corporate wrongdoing by imposing stricter regulations on public companies and auditing firms. It was enacted in response to corporate accounting scandals like Enron and WorldCom that shook the financial markets and eroded public trust in the integrity of corporate reporting. The act established a new independent oversight board for the accounting profession, increased penalties for white-collar crimes, strengthened protections for whistleblowers, and established new disclosure requirements for public companies.

Question 14

Which of the following is true of the penalties under the Foreign Corrupt Practices Act?

Accepted Answer

The answer of Which of the following is true of...

Question 15

Sebastian and Amy are arguing over secondary legislations that were in place prior to the passing of the Foreign Corrupt Practices Act (FCPA).Amy is of the opinion that the FCPA encompasses all secondary measures that were in use to prohibit corrupt practices.Sebastian disagrees with Amy on this point.Which of the following,if true,would strengthen Amy's argument?

Accepted Answer

Choice C strengthens Amy's argument by stating that the FCPA requires corporations to fully disclose all transactions conducted with foreign officials in line with the SEC provisions. This shows that the FCPA goes beyond just prohibiting specific corrupt practices and includes broader provisions for disclosure and transparency. Choices A, B, and D are irrelevant to the argument as they do not address whether the FCPA encompasses secondary legislation.

Question 16

Which of the following is one of the key pieces of U.S.legislation designed to discourage,if not prevent,illegal conduct within businesses?

Accepted Answer

The U.S. Federal Sentencing Guidelines for Organizations are key legislation designed to discourage and prevent illegal conduct within businesses by providing guidelines for sentencing organizations convicted of white-collar crimes, such as fraud and bribery. The guidelines take into account the level of cooperation by the organization in preventing and detecting criminal conduct, making it a powerful incentive for businesses to establish strong compliance programs. The other options (B, C, D) are not related to preventing or discouraging illegal conduct within businesses.

Question 17

_____ is the area of the Foreign Corrupt Practices Act that requires corporations to fully reveal any and all transactions conducted with foreign officials and politicians,in line with the Securities and Exchange Commission provisions.

Accepted Answer

The term that refers to revealing all transactions conducted with foreign officials and politicians is disclosure. This is a requirement under the Foreign Corrupt Practices Act, and it is in line with provisions outlined by the Securities and Exchange Commission. The other choices (enclosure, foreclosure, and exposure) do not accurately describe this requirement.

Question 18

The Federal Sentencing Guidelines for Organizations:

Accepted Answer

The Federal Sentencing Guidelines for Organizations holds businesses liable for the criminal acts of their employees and agents. This encourages organizations to establish effective compliance programs and reduce the likelihood of criminal behavior.

Question 19

Which of the following regulated unethical corporate behavior prior to the passing of the Foreign Corrupt Practices Act?

Accepted Answer

The Securities and Exchange Commission had the authority to regulate unethical corporate behavior prior to the passing of the Foreign Corrupt Practices Act. Specifically, they were responsible for enforcing the Securities Exchange Act of 1934, which required companies to maintain accurate financial records and prohibited bribery of foreign officials.

Question 20

Payments that are acceptable (legal)provided they expedite or secure the performance of a routine governmental action are called _____.

Accepted Answer

Facilitation payments are payments made to government officials in order to expedite or secure routine governmental actions, such as obtaining a permit or processing paperwork. While these payments are technically illegal under many countries' laws, they are often overlooked or sometimes even encouraged in certain circumstances. However, it is important to note that facilitation payments are distinct from bribes, which involve payments made with the intention of influencing an official's decision-making.

Quiz 6: The Role of Government