Category: General

How Do You Define a Compliance Program Failure?

In our perpetual quest for simplicity, sometimes we fail to understand the complexity of an issue.   In the corporate world, if you ask board members and CEOs how they would define a compliance program ”failure,” I am sure most  would answer that a compliance program fails when the government brings an enforcement action. In other words, when the government investigates a company and when...

Double Whammy for United Healthcare: Two False Claims Act Cases in Two Weeks

The False Claims Act is the government’s weapon of choice in fighting healthcare fraud.   In the beginning of the Obama Administration, Congress amended the False Claims Act and enacted a wish list from DOJ prosecutors. Healthcare companies have no choice but to negotiate settlements since they risk exclusion from federal healthcare programs, the equivalent of a death sentence for healthcare businesses. United Healthcare is...

The Perfect Compliance Combo: Culture and Controls

Compliance practitioners divide their commentary and insights into two general categories – ethical culture and compliance controls. It is easy to divide compliance issues into these two categories. Ethical culture articles are a little less concrete; compliance controls are practical and focused on policies and procedures. A compliance program cannot be deemed effective, however, unless there is a combination of these two important functions. An...

FCPA Risks and Acquisition Integration Challenges

Chief compliance officers have devoted significant efforts to conducting pre-acquisition due diligence of a proposed target companies. I do not intend to diminish the importance of pre-acquisition due diligence, but I have noticed companies are increasing attention to post-acquisition integration planning and execution. There is no question that disruption in the integration process can be very harmful to the overall success of an acquisition. Companies...

Anti-Corruption Compliance: The Need to Look Under the Cloak of Materiality

Sarbanes-Oxley revolutionized the auditing profession. Section 404 imposed stringent requirements for disclosure of the state of a company’s internal controls and financial reporting. The company’s independent auditor is required to report on the effectiveness of the company’s internal controls, and include bribery, theft and fraud. The requirements are intended to prevent a material misstatement of the company’s financial statements. The key term of art surrounding...

The Strange Case of OFAC Against Exxon for Sanctions Violations

In a bizarre enforcement action, The Treasury Department’s Office of Foreign Asset Control (“OFAC”) assessed a $2 million civil monetary penalty against ExxonMobil (“Exxon”) for violations of the Ukraine sanctions. (Copy Here). OFAC’s enforcement action boiled down to Exxon’s execution of eight legal documents with Igor Sechin, the CEO of Rosneft OAO (“Rosneft”), who is a Specially Designated Nation and Blocked Person on what is...

Is Your Company At-Risk for a Government Enforcement Action?

For some reason, I have always believed that picking successful stocks should not be very difficult. Unfortunately, my record in the stock market does not back up my self-assessment. On the other hand, when it comes to compliance and corporate misconduct, I am confident about identifying and defining “at risk” companies. What is an “at-risk” company? An at-risk company is a company that suffers both...

Should You Record Internal Investigation Interviews?

As a former federal prosecutor, I noticed a renewed discussion of the important question of whether witness interviews should be recorded (either audio or video). I have always found this issue to be interesting and have welcomed discussion of the pros and cons of recording witness interviews. In this era of focus on prosecutorial misconduct, the issue has taken on greater importance. For example, in...

United States v. Nixon – An Important Reminder

In these days of political turmoil, it is always important to know specific and relevant events from our country’s past. I was fascinated by the Watergate scandal and was enamored with the role played by prosecutors and Congressional investigations that eventually uncovered the full scope of President Nixon’s involvement in the Watergate burglary and cover-up. One of the more significant events, with continuing ramifications today,...

Important Polling Results from BvD Webinar on Beneficial Ownership

On June 28, 2017, Bureau van Dijk, a sponsor of my blog, conducted a webinar on the importance of beneficial ownership information to corporate compliance functions. The blog posting by Alistair King is here, and the replay of the important webinar is here. I have emphasized in a number of postings the importance of beneficial ownership information to compliance functions. It is not enough to...