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Foreign Corrupt Practices Act

IN THE WAKE of Watergate and several corporate scandals in the 1970s, Congress and the Security and Exchange Commission (SEC) turned their attention to investigate corporate business practices. A SEC survey covering a large number of American corporations revealed that about 350 corporations were involved in bribing of foreign officials and were contributing to political campaigns of foreign politicians to the tune of $750 million in order to receive lucrative government contracts.

Major oil companies (for example, Gulf Oil, Mobil Oil) and defense contractors (Lockheed, Northrop, Boeing, McDonnell Douglas) were involved in some of the well-known bribery cases. For example, the Lockheed Corporation admitted paying out more than $22 million to officials and political organizations in several different countries including Indonesia, Iran, and the Philippines.

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