Foreign Agent Disclosure Bill: DOJ Gains New Investigative Powers, Sets Fines Up to $200K for Violations

The "Sovereign Wealth Fund Transparency Act," despite its name, primarily focuses on overhauling the Foreign Agents Registration Act (FARA) – that's the law requiring individuals and organizations lobbying or doing public relations for foreign governments or political parties to publicly disclose their activities and funding. This new bill hands the Attorney General fresh tools to dig into potential FARA violations, including the authority to issue Civil Investigative Demands (CIDs) for a five-year period. It also lays out a new schedule of civil fines for failing to comply with FARA's registration and reporting rules.

Not Just Business: Redrawing the Lines on Foreign Advocacy

First up, the bill takes a closer look at who needs to register under FARA. Currently, FARA has exemptions for purely commercial activities. Section 2 of this act clarifies that these commercial exemptions get tricky if an agent's work, even if it looks like standard business, is also about "promoting the public or political interests of a foreign government or political party." Essentially, if your work for a foreign client bleeds into advancing their political agenda, the usual commercial pass might not apply. This means folks working for foreign entities in roles that mix business with what could be seen as political promotion might find themselves needing to register when they previously didn't. The exact scope of "public or political interests" isn't minutely defined, suggesting a potentially wider net and increased scrutiny for activities that could be interpreted as influencing U.S. policy or public opinion on behalf of a foreign power.

The Investigator's New Toolkit: Enter Civil Investigative Demands

Perhaps the biggest shift comes in Section 3, which gives the Attorney General (or their designated deputies) the power to issue Civil Investigative Demands, or CIDs. Think of a CID as a formal request, like a subpoena, that can be used to get documents or information before any civil or criminal court case is filed. If the Department of Justice (DOJ) has a hunch that someone is violating FARA, they can now use a CID to gather evidence.

There are rules, of course: each CID has to state what alleged FARA violation is being investigated and what specific information is needed. There are also protections for sensitive materials that would normally be shielded in legal proceedings. This CID authority isn't permanent; it's set to expire five years after the bill becomes law, and the Attorney General has to send annual reports to Congress detailing how these CIDs are being used. For individuals or organizations, this means the DOJ can start asking for records and testimony earlier in an investigation, potentially speeding things up but also requiring compliance with these demands outside of a formal lawsuit.

The Price of Silence: Stiffer Penalties for FARA Foul-Ups

Finally, Section 4 gets down to brass tacks on what happens if you don't follow FARA rules. The bill introduces a clearer set of civil penalties:

• Late or Incomplete Registration: Failing to file a timely or complete initial registration statement (required under FARA's section 2(a)) can result in a fine of up to $10,000 for each failure. Importantly, this fine can't be paid by the foreign principal – the agent themselves is on the hook.
• Late or Incomplete Supplements: Forgetting to file timely or complete updates to that registration (section 2(b) supplements) could cost up to $1,000 per instance.
• Ignoring Deficiency Notices: If the DOJ tells you your filing is deficient and you knowingly don't fix it within 60 days, you could face a fine up to $200,000, depending on how serious the issue is.
• Other Knowing Violations: Knowingly breaking any other FARA provision can also lead to a fine of up to $200,000.

Any money collected from these fines will be funneled back into covering the costs of enforcing FARA. The takeaway here is clear: the financial stakes for not complying with FARA are going up, putting more pressure on agents of foreign principals to get their paperwork in order and keep it accurate.