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7344505
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Decisions of Questionable Corporate Payments Abroad [Fact Sheet]
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7344505
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document
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Decisions of Questionable Corporate Payments Abroad [Fact Sheet]
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White House Press Releases (Ford Administration)
Press Releases
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7344505
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14
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1976-06-14
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1976
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Digitized from Box 27 of the White House Press Releases at the Gerald R. Ford Presidential Library
FOR IMMEDIATE RELEASE
JUNE 14, 1976
Office of the White House Press Secretary
THE WHITE HOUSE
FACT SHEET
DECISIONS ON QUESTIONABLE CORPORATE PAYMENTS ABROAD
The President today announced three decisions based on his
review of an interim report by the Cabinet Task Force on
Questionable Corporate Payments Abroad. The decisions are:
(1) to propose new corporate "disclosure" legislation with
regard to questionable payments abroad; (2) to endorse legis-
lation proposed by the SEC intended to assure the integrity
of corporate reporting procedures and the accountability of
corporate executives; and (3) to seek priority treatment at
forthcoming international meetings for the United States'
proposed international agreement on questionable payments.
I.
Background. The President created the Cabinet Task
Force on Questionable Corporate Payments Abroad on
March 31, 1976. The Task Force is chaired by Commerce
Secretary Elliot Richardson. Its members include:
Secretary of State; Secretary of Treasury; Secretary
of Defense; Attorney General; Special Representative
for Trade Negotiations; Director, Office of Management
and Budget; Assistant to the President for Economic
Affairs; Assistant to the President for National
Security Affairs; and Executive Director, Council
on International Economic Policy.
In creating the Task Force the President directed it
to conduct a comprehensive policy review and to explore
whether "additional avenues should be undertaken in
the interest of ethical conduct in the international
marketplace and the continued vitality of our free
enterprise system." He instructed the Task Force to
provide him with interim reports and a final report
by the end of the current calendar year.
The President's decisions followed his receipt of the
first interim report of the Task Force.
II. The Decisions
A. "Disclosure" Legislative Initiative. The President
announced that he had decided to submit legislation to
the Congress requiring reporting and disclosure of
certain payments by U.S. controlled corporations made
with the intent of influencing, directly or indirectly,
the conduct of foreign government officials. The
President instructed the Task Force to develop detailed
specifications for such legislation as quickly as
possible -- in order to allow Congressional action
on the proposal in this session of Co:
more
2
In announcing these decisions, the President expressed
confidence that the overwhelming majority of American
businessmen have conducted themselves as good citizens
both at home and abroad. The President's decisions
derived in part, he said, from a need to halt the growing
trend of spreading cynicism and to help restore confidence
in basic American institutions and principles.
B. Corporate Accountability Decision. The President
endorsed legislation proposed by SEC Chairman Roderick
Hills in his Report of May 12. The legislation would
amend the Securities Exchange Act of 1934:
-- to prohibit falsification of corporate accounting
records;
-- to prohibit the making of false and misleading
statements by corporate officials or agents to
persons conducting audits of the company's books
and records and financial operations;
-- to require corporate management to establish and
maintain its own system of internal accounting
controls designed to provide reasonable assurances
that corporate transactions are executed in accord-
ance with management's general or specific authori-
zation, and that such transactions are properly
reflected on the corporation's books.
C. Acceleration of International Efforts. The President
announced his intention to seek priority treatment for
the United States' proposed international agreement on
questionable corporate payments abroad.
The proposed agreement was first put forward by the
United States in a United Nations forum on March 5,
1976. If successful, it would result in an international
treaty based on the following principles:
-- It would apply to international trade and investment
transactions with Governments, i.e., government
procurement and other governmental actions affecting
international trade and investment as may be agreed;
-- It would apply equally to those who offer or make
improper payments and to those who request or accept
them;
-- Importing Governments would agree to establish clear
guidelines concerning the use of agents in connection
with government procurement and other covered trans-
actions, and establish appropriate criminal penalties
for defined corrupt practices by enterprises and
officials in their territory;
-- All Governments would cooperate and exchange infor-
mation to help eradicate corrupt practices;
more
3
-- Uniform provisions would be agreed for disclosure
by enterprises, agents and officials of political
contributions, gifts and payments made in connection
with covered transactions.
The President's initiative will supplement related U.S.
international initiatives taken in the OAS, OECD, GATT
and UN.
III. Ongoing Activities.
A. Policy Development and Coordination. The Task Force
will continue to have responsibility for policy develop-
ment and coordination within the Executive Branch in
accordance with the President's directive of March 31.
B. Investigations. Responsibility for investigative
activities will remain with the appropriate investigative
agencies and not the Task Force. Investigative and
enforcement actions of the audit agencies, the IRS, the
FTC, the SEC and the Department of Justice are ongoing
in accordance with the dictates of current law.
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