While reading the Embraer settlement documents, I read over the facts implicating a senior legal executive and his/her involvement in the Embraer bribery scheme. Truthfully, I had a slight gasp as I read about a fellow lawyer crossing the line – from lawful to unlawful. Not only did the Embraer legal executive know about the bribery scheme, the executive was the one who came up...
The Embraer FCPA settlement action contains a number of important lessons learned and compliance reminders. In several significant respects, the Embraer case confirms in several areas why proactive compliance programs are important to prevent and detect possible bribery schemes. Given the length of the Embraer investigation, we can only hope that many compliance programs have moved beyond the deficiencies highlighted in the case. Nonetheless, there...
After years of investigation, disclosures, and press reports, the Embraer FCPA case finally came to a close. Hopefully, we will not see more of these long-term, seemingly endless investigations. The Justice Department and the SEC have publicly committed to moving FCPA investigations more expeditiously. In any event, Embraer settled its case for $205 million with the Justice Department and the SEC. The case itself has...
There is no doubt that corporate boards operate under greater scrutiny. The trend is clearly to hold boards and individual members accountable. But this is not the result of government prosecution; rather, this trend reflects increased regulation and changes in investor and shareholder efforts to monitor corporate boards and CEOs. As corporate boards assume greater responsibility for supervision and monitoring of company activities, they have...
If you work in compliance in the healthcare industry, you have a tough job. The number and variety of risks that healthcare providers face is daunting. The False Claims Act is a mighty weapon in the hands of federal prosecutors. Hospitals are under the enforcement microscope given the significant role they play in the delivery of healthcare. Tenet Healthcare Corporation, a national hospital chain, recently...
When looking through the wreckage of a major corporate compliance disaster, it is relatively easy to spot the important events when business needs (or money) are consciously elevated over compliance concerns or even reputational risks. It is easy to spot the circumstance, and with perfect hindsight announce to everyone (assuming someone is listening) that you would not have followed that course of action. In the...
The anti-corruption field has the benefit of many great leaders, bloggers, academics, researchers, NGOs and other contributors who are committed to the battle against corruption. Many people dedicate themselves with little to no compensation but selflessly work to advance the global battle against corruption. I recently met Pavlo Bespalov, one of the editors of a blog, Compliance Periscope, (Here), at the recent SCCE meeting in...
Compliance and enforcement headlines have focused on the Wells Fargo scandal. And for good reason. On September 8, 2016, the Consumer Financial Protection Bureau, the Comptroller of the Currency and the Los Angeles County Attorney announced the regulatory settlement against Wells Fargo. The enforcement action included a detailed discussion of the facts. What was interesting in the public announcement was that the Justice Department had...
If you review the last ten years of FCPA enforcement, the unmistakable pattern is rising expectations with regard to corporate compliance programs, particularly with regard to third party due diligence and risk management. Over the course of numerous enforcement actions, DOJ and the SEC have reached the point now where they are questioning not just the conduct of due diligence but the quality of due...
The Wells Fargo scandal represents a textbook case of compliance and culture failures. Recently, the scandal and Wells Fargo’s defensive crisis management strategy resulted in CEO Stumpf’s resignation. Stumpf’s demise was inevitable. He will go down in history as the only CEO of a major bank forced to resign in the aftermath of a public scandal. It is important to review what happened at Wells...
