Or the Exchange Act (15 U.S.C. § 78m(b)(5)) provides that “[nJo person shall knowingly circumvent or knowingly fail hapter : to implement a system of internal accounting controls or The FCPA: knowingly falsify any book, record, or account ....””” The | SSTEUINAING) [NCS ON Exchange Act defines “person” to include a “natural person, company, government, or political subdivision, agency, or instrumentality of a government.” controls, falsifying books and records, making false state- An issuer’s officers and directors may also be held civ- ments to accountants, and signing false certifications.” He illy liable for making false statements to a company’s audi- consented to the entry of an injunction and paid disgorge- tor. Exchange Act Rule 13b2-2 prohibits officers and direc- ment and a civil penalty.**! He also later pleaded guilty in tors from making (or causing to be made) materially false the United Kingdom to conspiring to corrupt Iraqi and or misleading statements, including an omission of material Indonesian officials." facts, to an accountant. This liability arises in connection with any audit, review, or examination of a company’s finan- Criminal Liability for Accounting Violations cial statements or in connection with the filing of any docu- Criminal liability can be imposed on companies ment with SEC?” and individuals for knowingly failing to comply with the Finally, the principal executive and principal finan- FCPA’s books and records or internal controls provisions. cial officer, or persons performing similar functions, can As with the FCPA’s anti-bribery provisions, individuals are be held liable for violating Exchange Act Rule 13a-14 by only subject to the FCPA’s criminal penalties for violations signing false personal certifications required by SOX. of the accounting provisions if they acted “willfully.”* Thus, for example, in January 2011, SEC charged the for- For example, a French company was criminally mer CEO of a US. issuer for his role in scheme