CPA, FEPA, FTO Exposure: Navigating Heightened U.S. Compliance Risks in Guyana

Part 4

Welcome to the fourth of our five-part blog series about Guyana, an American ally that has emerged as one of the fastest-growing economies in the world, driven by an oil boom that has transformed the country’s economic trajectory. Read Part 1: Guyana: A Primer on a Strategic U.S. Caribbean & South American Ally, Part 2: Guyana’s FDI Boom and Tourism Growth Outpace Infrastructure Capacity, and Part 3: Guyana’s Petroleum Act and Local Content Rules: What Energy Investors Need to Know.

Key Takeaways from Part 4 are:

• There are heightened U.S. compliance risks for investors in Guyana. American businesses must navigate strict anti-corruption laws like the FCPA and FEPA. DOJ enforcement resumed in mid-2025 with a sharper focus on national security threats, making robust compliance programs and partner due diligence essential.
• Cartel designation as FTOs raises operational and reputational stakes. U.S. treatment of drug cartels as foreign terrorist organizations means businesses in Guyana face increased scrutiny. Even indirect links to high-risk entities can trigger sanctions exposure, requiring enhanced supply chain mapping, customer screening, and proactive risk management.
• Trade and customs vulnerabilities demand vigilance. Guyana’s role as a transit point for smuggled goods creates significant sanctions and compliance risks. Companies must verify source countries, conduct end-user checks, and monitor counterparties to avoid inadvertent violations and reputational damage.

The final article, slated for release on December 22, 2025, will focus on corporate governance and structuring in Guyana.

International Trade and Customs Around Guyana

While Guyana’s regulatory modernization has improved investor confidence, American entities must also consider the extraterritorial reach of U.S. law, particularly the Foreign Corrupt Practices Act (FCPA) and its sister statute,[1] the Foreign Extortion Prevention Act (FEPA).[2] The FCPA prohibits U.S. individuals and companies from offering bribes to foreign officials, and it remains one of the most vigorously enforced anti-corruption laws in the world. On the flip side, FEPA, passed in 2023, aims to close a gap with the FCPA by targeting the demand side of corruption (not just the supply side), and making it illegal for foreign officials to solicit or accept bribes from U.S. individuals or companies. 

In early 2025, FCPA enforcement experienced a temporary pause under a U.S. executive order aimed at reducing regulatory burdens on American businesses. However, this pause was short-lived.[3]  The Department of Justice (DOJ) resumed enforcement in June 2025, issuing updated guidelines to refocus the FCPA on protecting U.S. national and economic security interests.[4]  Going forward, DOJ enforcement will emphasize serious misconduct, with an emphasis on conduct that involves cartels or FTOs, or otherwise threatens national security.

This updated approach suggests that American investors in Guyana, particularly in the oil and gas sector, will remain under close scrutiny. Given the prominence of state actors and regulatory officials in oil licensing, infrastructure, and permitting, even routine business interactions can trigger FCPA and FEPA exposure. Investors should implement robust anti-corruption compliance programs, conduct thorough due diligence on local partners and agents, and maintain internal reporting mechanisms to ensure alignment with DOJ expectations. Transparency, documentation, and a commitment to ethical conduct are not optional on this front; rather they are strategic imperatives, as recent DOJ indictments have indicated.

Compliance Concerns Raised by U.S. Treatment of Cartels as FTOs

On his first day in office, U.S. President Donald Trump signed an executive order designating drug cartels “foreign terrorist organizations.”[5] While Guyana does not have powerful, established drug cartels like Mexico or Colombia, businesses operating in Guyana, particularly those with international connections or those in industries susceptible to organized crime, should be aware of the broader implications. Indeed, Guyana is a significant transit point for drug trafficking, has porous borders, and still relies upon many underdeveloped and loosely monitored ports, remote airstrips, and intricate river networks for trade. In June 2025, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned four Guyanese nationals and two Colombian nationals responsible for trafficking large quantities of cocaine from South America to the United States, Europe, and the Caribbean.[6] Moreover, several key Guyanese businesses and individuals, including some of the wealthiest families in Guyana, have faced scrutiny by the U.S. in recent years, negatively impacting U.S. investments and operations in Guyana.[7] As recently as early October 2025, Nazar and Azruddin Mohamed, two Guyanese nationals, were indicted by a federal grand jury in Miami on wire fraud and money laundering charges related to a complex gold trading scheme.[8]

These developments highlight an important consideration for investors operating or investing in Guyana: U.S. authorities are paying closer attention to foreign partnerships and counterparties in regions historically affiliated with organized crime and cartels. Investors should understand that shifts in a local partner’s legal or regulatory status can lead to significant operational, legal, and reputational challenges for them, and therefore necessitate a proactive approach to risk management.

For starters, since business practices in the region historically lag behind compliance standards followed by more advanced economies, conducting proper due diligence with partners is of utmost importance. Such considerations cannot be overlooked by businesses, who need to be attuned to several concerns:

• Financial Institutions: Banks and other financial institutions operating in Guyana should seek to mitigate the risk of inadvertently dealing with FTOs and associated entities and individuals. Effective mitigation efforts would include enhanced customer screening and ongoing monitoring against U.S. Treasury Department lists, such as OFAC’s Specially Designated National (SDN) list; verification of Ultimate Beneficial Ownership (UBO) of third-party entities, and the use of compliance tools to detect suspicious activity.
• Supply Chain Concerns: Companies sourcing goods or services from regions known to be influenced by designated cartels could face disruptions or be subjected to additional due diligence requirements. Businesses should consider conducting more expansive supply chain mapping and third-party screening, by verifying the identity, ownership structure, and jurisdiction of key suppliers and subcontractors.
• Reputational Risk: Even if a company’s operations are not directly linked to a designated cartel, there’s a potential reputational risk for businesses perceived as operating in areas where these groups are present or influential. To mitigate this, businesses operating in the region will likely implement media monitoring, stakeholder engagement plans, and crisis response protocols in parallel with legal compliance measures. Businesses may also monitor publicly accessible information relating to high-risk customers to avoid exposure to potential reputational, operational, and legal risks.

American companies doing business in Guyana, as well as any international corporations falling under the jurisdiction of the Department of Justice and doing business in Guyana, should take steps to reduce their exposure and risk. For examples, businesses should strengthen their “Know Your Customer” and “Know Your Business” procedures to identify potential links to designated cartels or their affiliates. This includes collecting detailed information on counterparties’ ownership structures, beneficial owners, jurisdictions of incorporation, and business history. Robust screening, risk rating, and ongoing monitoring should be conducted for all clients, including correspondent banks and legal representatives. In addition, companies should conduct thorough due diligence on all suppliers and partners, especially those based in higher-risk regions. This may include requiring disclosures of subcontractors, conducting third-party risk assessments, engaging external risk-management consultants, and implementing annual re-certification processes to monitor changes in risk exposure.

Further, businesses should implement or strengthen their AML, counter-terrorism financing (CTF), and sanctions compliance programs. These programs should include updated internal controls and written policies, designated compliance personnel, mandated employee training on compliance red flags, established escalation procedures, and robust protocols for filing Suspicious Activity Reports (SARs).

Trade & Customs Sanctions

Guyana’s geographic location presents complexities for businesses operating in the region, especially after the designation of many regional drug cartels as FTOs and the expansion of sanctions on entities and individuals in neighboring countries like Venezuela. A growing number of goods, including gasoline, gold, and agricultural goods, is smuggled into Guyana each year, in attempts to evade tariffs and export controls. Guyana’s port cities, specifically, Georgetown and Berbice, have therefore inadvertently become transit points for illicit commerce. Venezuelan products are reexported out of Guyana’s port cities, often without clear country-of-origin documentation, in violation of U.S. and international trade laws.

This dynamic has exposed American businesses to significant risk. Smuggled Venezuelan gasoline, for example, is sold at steep markups in Guyana, incentivizing black market trade that can implicate legitimate businesses. U.S. investors operating in Guyana may face exposure to secondary sanctions or increased scrutiny if their supply chains are deemed noncompliant. Similarly, gold, often melted down and stripped of identifying markers, is exported from Venezuela to Guyana to avoid the sanctions placed on Venezuela, leading to additional black-market trade and tariff evasion schemes. Businesses must therefore be especially cautious when dealing in sectors like gasoline and gold, and can do so by exercising proper due diligence – particularly in verifying source countries, conducting end-user checks, and screening counterparties’ supply chains — to avoid inadvertent violations of U.S. sanctions or exposure to illicit financial flows.

[1] See 15 U.S.C. §§ 78dd-1, 78dd-2, and 78dd-3.

[2] See 18 U.S.C. § 1352.

[3] See Pausing Foreign Corrupt Practices Act Enforcement to Further American Economic and National Security, The White House (Feb. 10, 2025), available at https://www.whitehouse.gov/presidential-actions/2025/02/pausing-foreign-corrupt-practices-act-enforcement-to-further-american-economic-and-national-security/.

[4] See Guidelines for Investigations and Enforcement of the Foreign Corrupt Practices Act (FCPA), U.S. Department of Justice (June 9, 2025), available at https://www.justice.gov/dag/media/1403031/dl?inline.

[5] See Designating Cartels And Other Organizations As Foreign Terrorist Organizations And Specially Designated Global Terrorists, The White House (Jan. 20, 2025), available at https://www.whitehouse.gov/presidential-actions/2025/01/designating-cartels-and-other-organizations-as-foreign-terrorist-organizations-and-specially-designated-global-terrorists/; see also Olivia Singelmann, Parker White, Vanessa Singh Johannes, Gegory Husisian, and Alejandro N. Gomez, What Every Multinational Company Should Know About … Mitigating Risks Posed by the New Trump Administration Focus on Drug Cartels and TCOs, Foley & Lardner LLP (June 17, 2025), available at https://www.foley.com/insights/publications/2025/06/multinational-company-mitigating-risk-focus-drug-cartels-tco/.

[6] See Treasury Targets Network Trafficking Cocaine to the United States and Europe, U.S. Department of Treasury (June 5, 2025), available at https://home.treasury.gov/news/press-releases/sb0156.

[7] See Treasury Targets Corruption Network in Guyana, U.S. Department of Treasury (June 11, 2024), available at https://home.treasury.gov/news/press-releases/jy2401; Sabrina Valle and Rami Ayyub, U.S. Imposes Sanctions on Former Exxon Contractor in Guyana over Alleged Fraud, Reuters (June 11, 2024), available at https://www.reuters.com/world/us/us-imposes-sanctions-guyanese-mining-magnate-over-alleged-fraud-2024-06-11/.

[8] See Kemol King,Guyana Arrests Opposition Figure and Gold Magnate Wanted by U.S., Reuters (Oct. 31, 2025), available at https://www.reuters.com/world/africa/guyanese-politician-wanted-by-us-arrested-local-media-2025-10-31/.