The Halo Platform Companies (Halo Platform Development, LLC, HXE Corp., Halo Platform Technology, S.A., Halo Capital Corp. and its subsidiaries, collectively, the “Company” or “Halo Company”) conducts business activities in both the U.S. and foreign locations. This can present the unique challenge of trying to observe local laws and business customs while still complying with applicable U.S. and other laws prohibiting corruption, money laundering and other criminal violations. The U.S. Foreign Corrupt Practices Act (“FCPA”) and other anti-corruption laws prohibit any payment, or offer of payment, to a “foreign official” for the purpose of influencing that official to engage in unlawful conduct, e.g., assist in obtaining or retaining business, or gaining an improper advantage.
The Halo Platform Companies are committed to conducting business with integrity and honesty. Accordingly, it has established this Policy to ensure that all employees, officers and directors of the Company, its agents, and its affiliates are aware of the FCPA and obligations to comply with its requirements. This Policy is focused on the FCPA because of its broad application; however, it is the Company’s Policy to comply with all applicable anti-corruption laws and anti-money laundering laws for all countries in which it conducts business.
The Company’s Anti-Corruption Policy prohibits any Company director, officer, employee, vendor or other third party acting on behalf of or as agent of the Company, to give or to offer anything of value to a “foreign official” or government employee, or to any person in exchange for something, e.g., obtaining an improper advantage, retaining business. Under this Policy, every officer, employee, and third party acting on behalf of the Company:
FCPA Anti-Bribery Provisions. This Policy applies to the Company and its subsidiaries, as well as its officers, directors, employees, agents, shareholders and third party representatives and vendors. The FCPA and this Policy prohibit any offer, payment, promise to pay, or authorization of payment of anything of value to a “foreign official” for the purpose of influencing that official in his official capacity, inducing that official to do or omit to do, an act that violates his lawful duty, or for securing any improper advantage.
This provision is extremely broad, e.g., (i) the mere offer to a foreign official is a violation even though the official declines the offer, (ii) the authorization of such payment by a corporate official such as the CFO is a violation even if no such offer or payment occurs. Note the term “anything of value.” This Policy covers not only cash, crypto-currencies, watches or other obvious goods, but also “anything of value,” e.g., a beach house/ski lodge at below rental market value, helping a family member with admission to a University, business opportunities, stock options.
The term “foreign official” is broadly defined and includes:
Some government entities may be engaged in commercial activities and appear to be separate and distinct from the government, but are owned or substantially owned by the government, e.g., state-owned banks or airlines. The FCPA and this Policy apply to such entities even though they are engaged in commercial activities and may appear to be independent or separate from the government.
Sometimes third parties or independent contractors, rather than the Company itself or its employees, are used to offer or make an illegal payment. These entities are called intermediaries and it is illegal to offer or to pay a bribe using such intermediaries. A typical scenario involves hiring a local consulting firm who has “contacts” in the government entity to assist with the desired result, e.g., obtaining a business license from a Ministry or banking authority. Often, a lump sum is paid to the intermediary to assist in obtaining the desired result, with no obligation to account for the use of those funds, e.g., $80,000 to obtain the license.
Use of such intermediaries is a violation of the FCPA, just as if the Company itself had engaged in the illegal conduct and will expose the Company to liability under the FCPA. Great care should be taken in retaining such agents or consulting firms. An appropriate level of due diligence and investigation should be undertaken to ensure that the agent or firm understands its obligations under the FCPA and does not intend to engage in any improper practices. In determining whether to engage a particular representative, many factors should be considered, such as:
If the investigation uncovers a “red flag” for the person or firm, the Compliance Officer should be notified before entering into a contract or engaging that agent or firm.
Contracts that retain such agents or consulting firms should include provisions that require the entity to acknowledge its obligation to comply with the FCPA and anti-money laundering laws and to maintain accurate records of all payments and expenses associated with its representation. Cash payments should be prohibited. Training the agent or consulting agency should be offered, if necessary, so they understand their legal obligation. The Halo entity engaging that agent or consulting firm has an affirmative duty to monitor the expenses and payments of the hired entity.
Sometimes, foreign officials will subtly encourage contributions to his/her “favorite charity” in return for business, obtaining or renewing a contract, or to obtain some improper advantage. Sometimes such charities are owned or operated by the foreign official or a family member or relative. Such requests for payments or donations, or efforts to “steer business” are highly suspect and are likely to violate the FCPA and should be reported immediately to the Compliance Officer for evaluation before agreeing to or making such payments and be reviewed by the Halo Platform Legal Department.
In addition to its anti-bribery provisions, the FCPA also imposes certain accounting requirements on companies, called the “books and records” provision. Few, if any companies, have accounting line-items for “Bribes Paid” because most illegal payments are “buried” in the books under Misc. Expenses, Entertainment Expenses, or padded expenses for legitimate items. Hiding such payments means that the books and records of the company do not clearly represent the transactions of the company. The “books and records” provision requires that all records and accounts must be kept in reasonable detail, must be accurate, and should accurately reflect all transactions made by the Company. Accordingly, an internal accounting control system must be in place to ensure that the Company’s books and records accurately represent its operations.
This Policy incorporates these recordkeeping requirements. In order to comply with these requirements, it is imperative that Company employees, agents and others acting on the Company’s behalf maintain complete and accurate records with respect to all transactions and dispositions undertaken on behalf of the Company.
The consequences of failing to comply with the FCPA are very serious.
Violation of the FCPA and related laws by a Company employee can result in both criminal and civil violations which could include millions of dollars in fines against the Company. Individuals also can be subject to prosecution, criminal fines, and imprisonment, as well as disciplinary action by the Company, including dismissal. Note that the FCPA states that fines and penalties imposed upon individuals may not be paid directly or indirectly by any corporation for which they may have acted.
This Policy applies to all levels of the Company, including directors, officers and upper management. It is the responsibility of all members of senior management to supervise, monitor and train the employees under their supervision to ensure that the objectives of this Policy are fulfilled. It is the responsibility of each employee to comply with this Policy and with procedures and guidelines established in furtherance of this Policy. Failure to comply with the Policy is grounds for disciplinary action, which may include termination.
If you have any doubt about whether a person is a foreign official, the offer or payment could be a violation, or suspect any other illegal activity or money-laundering conduct, notify the Compliance Officer as soon as practicable, who will obtain advice from the Company’s legal counsel. Further, consistent with the “books and records” provision, officials should maintain complete and accurate records sufficient to show compliance with the above rules, the FCPA generally, and any other Company policies. This means, among other things, that when a payment is intended to go to a particular party or entity for a particular purpose, the records must accurately reflect the true recipient and the true purpose of the payment.
n certain parts of the world, it is common for low-level government employees to request small payments (“grease payments”) in order to expedite or secure non-discretionary “routine governmental action,” such as obtaining a visa or a permit, connecting electricity. All countries have laws prohibiting bribes, which sometimes are selectively enforced or not enforced. However, such payments almost always are violations of local law and may be subject to local prosecution, even though those payments may be customary and “how business is done.” In any event, these payments may violate U.S. law, depending on the circumstances. You must notify the Compliance Officer of such situation and obtain approval, regardless how common or ordinary the payment may seem.
In many countries it is a common practice for government officials to own or operate a business enterprise. The FCPA and related laws do not prohibit legitimate business relationships with business enterprises owned or controlled by foreign officials. However, such business enterprises can serve as a “backdoor” to funnel funds to a government official involved in the Company’s business activities. Great care must be taken to avoid any association with any such enterprise in circumstances that might constitute an evasion of the FCPA. If you intend to engage in business with a company that is owned by one or more government official or entities, or sense that your are being “encouraged” or “steered” to such a business enterprise, you must contact the Company’s Compliance Officer.
No person acting on behalf of the Company may enter into any transaction with agents, contractors, consultants, lawyers or other persons that is intended or designed to permit such persons to circumvent currency, tax or other laws of a foreign country. Any transaction that has the appearance of permitting any person to circumvent such laws must be avoided. Particular care must be taken in respect to “split payments” (i.e., payments for services that are made outside the country where the services are performed, other than payments in the country in which the provider of the services is incorporated and has an established presence, or payments inside the country in other than the local currency).
Any transaction, no matter how seemingly insignificant, that might give rise to a violation of the FCPA or this Policy must promptly be reported to the Company’s Compliance Officer [set up a special email for this to separate from your day-to-day emails, e.g., email@example.com. All such reports will be treated as confidential and will be shared with authorized individuals only on a need-to-know basis. The Company will take no adverse action against any person making such a report, provided a good faith effort has been made to comply with this Policy.
Officers, employees and third party agents should note that the failure to report known or suspected wrongdoing when that person has knowledge of such conduct may, by itself, subject the individual to disciplinary action, including termination.
Any questions concerning the FCPA, anti-money laundering or other related issues or reporting requirements should be addressed to the Compliance Officer.
The Company is committed to honesty and integrity in its business activities and appreciates your understanding and compliance with this Policy.
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Questions, comments and requests regarding this FCPA policy should be addressed to firstname.lastname@example.org.
Last modified: July 2018