Bribery Enforcement in Russia Focuses on Low End Fraud

The Russian general prosecutor’s office has published year-end statistics for corporate bribery enforcement in 2018. According to a summary in the FCPA blog, the figures are selected to demonstrate a tough stance on fighting corruption, but there is one major flaw in the strategy – it targets small and mid-scale bribery in day-to-day business almost exclusively, while oligarchs and well-connected gangsters get a pass. Authorities opened 487 investigations for bribery resulting in an impressive 439 convictions. The entities that were convicted coughed up total penalty payments of $10.7 million. All entities convicted of bribery are prohibited from bidding in state procurement tenders for two years. Most bribes were paid to low-ranking public officials to avoid paying administrative fines, to acquire state licences or accelerate registration procedures. In some cases, the companies paid bribes to public officials to win municipal tenders. The takeaway for companies doing business in Russia is that the main risk is not the penalty but being exposed in the public register of offenders, and taking prescribed anti-corruption measures can be a defense against liability for corporate bribery.