The difference between the almost right word & the right word is really a large matter–it’s the difference between the lightning bug and the lightning — Mark Twain (1888). It is hard to understand why there are still advocates for an FCPA compliance defense. The issue is dead and gone, and is unlikely to come back in any form. I guess there are people who...
I was honored to participate in a RAND roundtable meeting on May 28, 2014, Transforming Compliance: Emerging Paradigms for Boards, Management, Compliance Officers, and Government. The meeting included three white paper submissions, one of which I authored on the changing relationship between chief compliance officers and general counsels. The report and the papers are fascinating and address cutting edge ethics and compliance issues. The report...
Compliance professionals like to emphasize that accountability is essential to create an ethical culture. There is no question that if a company does not hold anyone accountable for ethics and compliance issues a company is unlikely to foster a meaningful culture. To put it another way, if senior management is not held accountable for their actions or failures to act, then it is hard to...
I have urged compliance professionals to avoid scare-tactics as a way to enhance their importance in the corporate organization. It is too easy to run around and spread fear about the importance of compliance to prevent a government investigation and prosecution. That message is too negative and turns off listeners. Moreover, everyone in senior management knows the risks of a government enforcement action. They do...
I have always admired the ability of intelligent people to explain complex ideas in simple terms. Prosecutors have to explain complex facts and crimes to a jury. If you ever watch TED talks online, you can see a variety of speakers who have mastered difficult concepts and explain them in terms that are accessible to a wide audience. This same approach is needed in the...
Global anti-corruption enforcement is fast becoming a complicated affair. No longer can companies just focus on the FCPA, with momentary blips of concern for the UK Bribery Act. The OECD and other international organizations want to see aggressive enforcement around the globe, and they are doing a great job of pushing countries on this issue. Of course, the more cynical view is that more countries...
Due diligence of third parties can drive you crazy. You know you are in trouble when you start babbling to yourself and others about red flags, more red flags, and even more red flags. You can start thinking that the movie, “The Shining” was a documentary depicting your third-party due diligence process. When this happens, you need an intervention. Someone has to say, enough is...
If anyone wants proof that the compliance profession is on the rise, if anyone still doubts that the young professional of compliance is rapidly growing, all you have to do is attend an annual meeting of the Society of Corporate Compliance and Ethics (“SCCE”). I had the honor of attending and speaking the recent SCCE meeting in Chicago. What an amazing event. The energy and...
Compliance officers face lots of challenges when conducting third-party due diligence. One issue that frequently arises is determining who exactly owns a potential agent or distributor. In many circumstance compliance officers have a difficult time peeling back the layers of legal ownership, examining related party ownership stakes and other complexities designed to obfuscate the true ownership of the third-party. In the financial industry, the inquiry...
The debate over corporate wrongdoing, punishment and deterrence continues. Corporations are not people but are entities that operate through collective behavior. It is interesting to consider whether individual punishment versus corporate entity punishment effectively deters corporate wrongdoing. After all, a company is only liable for individual conduct that is attributed to the organization. The issue of corporate wrongdoing is on the front burner at the...
