Travel and Entertainment Corruption Risks: Five Hallmarks of an Acceptable Hospitality Expenditure (Part One of Three)

Flying clients to visit factories, putting them up in hotels while they attend meetings and picking up the tab for their dinner can all be regular and acceptable business activities. But when those clients are officials of foreign governments, companies must tread carefully to ensure that genuine business expenses don’t become impermissible bribes. The abuse of travel and entertainment expenses was one of the first areas of focus for the government when it escalated FCPA enforcement over a decade ago and now many companies have established T&E compliance programs. However, as recent settlements involving T&E demonstrate, companies cannot afford to become complacent. This article, the first in a three-part series, sketches in the contours of the boundary between acceptable entertainment and corruption and identifies five hallmarks of appropriate travel and entertainment. Subsequent articles will address what a solid travel and entertainment policy should look like and how companies can actively monitor their T&E programs to prevent fraud and corruption. See also “A Guide to Detecting and Preventing Expense-Reimbursement Fraud (Part One of Three)” (Apr. 16, 2014); Part Two (Apr. 30, 2014); and Part Three (May 14, 2014).

To read the full article

Continue reading your article with an ACR subscription.