Episode 442 — When Forced Labor Risk Hits the P&L

In this episode of Corruption, Crime and Compliance, Michael Volkov explains why forced labor compliance has shifted from a sustainability afterthought into a direct financial and operational threat. He walks through the U.S. Trade Representative’s new two-tier Section 301 tariff structure targeting 60 trading partner economies over forced labor practices, the rebuttable presumption under the Uyghur Forced Labor Prevention Act that can freeze finished goods at the border over a single noncompliant sub-tier component, illustrated by a real case where thousands of finished luxury vehicles were impounded because of one blacklisted electronic part, and the EU’s forthcoming forced labor regulation, which will allow European authorities to block imports, pull products from shelves, and order their disposal starting in late 2027. Volkov argues that these overlapping pressures require companies to abandon simplistic, country-based risk scoring in favor of a residual-risk approach that accounts for how mature and verifiable a supplier’s actual labor controls are, and he outlines the specific warning signs of coercion, debt bondage, document confiscation, wage manipulation, forced overtime, and deceptive subcontracting, that a credible due diligence program must be trained to detect. The episode closes with a practical call to action: build an honest baseline of where supply chain risk is concentrated today and use it to prioritize a due diligence program capable of producing real evidence, not just policy documents, before regulators or customs officials come asking.











