Corruption, Crime & Compliance

Featured Articles:

4 Mar, 2019

The Criminal Pursuit of Huawei China: DOJ Brings Two Indictments

The Department of Justice has launched two separate criminal cases against Huawei China, the controversial Chinese telecommunications equipment provider. For years, US government officials have questioned the ownership, control and practices of Huawei, claiming that it is owned by the Chinese government and acting as an agent for Chinese interests. At the end of January, the Justice Department announced two separate indictments against Huawei, and...

General

27 Feb, 2019

AppliChem Pays OFAC $5.5 Million for Cuba Sanctions Violations

OFAC continues to pile up enforcement actions for sanctions violations. In yet another example of a failure of companies to address compliance, to follow up on compliance and to ensure ultimate compliance, AppliChem, a German company agreed to pay $5.5 million for 304 violations of the Cuban Assets Control Regulations during the time period between May 2012 and February 2016. Specifically, AppliChem engaged in 304...

General

27 Feb, 2019

CCO and CLO “Authority”: A Fundamental Requirement

A basic compliance program control, which is often overlooked (or assumed to exist), is the requirement that a chief compliance officer and/or chief legal officer have the authority to stop a specific contract or business transaction. To simplify this statement, compliance and legal have to approve certain business transactions before they can proceed. If a compliance officer or legal officer is consulted just for “advice,”...

General

25 Feb, 2019

U.S. Marijuana Laws Cause Uncertainty for Financial Institutions

Noah Smith, Associate at The Volkov Law Group, rejoins us for an interesting blog posting on the compliance challenges for financial institutions and other businesses involved in legal marijuana transactions. Noah can be reached at [email protected]. The quasi-legal status of marijuana in today’s United States is raising serious questions about federalism and enforcement for U.S. financial institutions. It is well known that marijuana is still...

Podcasts

24 Feb, 2019

Episode 78 — Ethical Cultures and Proactive Measures to Mitigate Organizational #MeToo Risks

The corporate world has been rocked by major governance failures surrounding #MeToo incidents and complaints. Recently, Google suffered global walkouts by employees who were upset by Google’s payment of lucrative severance packages to senior executives forced to resign because of sexual misconduct issues, and a culture of sexual misconduct that included 48 sexual misconduct incidents resulting in the departure/termination of employees. Companies have to address...

General

20 Feb, 2019

Lessons Learned from the Cognizant FCPA Resolution (Part IV of IV)

The Cognizant FCPA enforcement action will go down as a problematic resolution for the policy reasons mentioned in my last post. Putting those concerns aside, there are some important lessons learned and observations that should be examined. Credit for Pre-Existing Compliance Program: From a compliance perspective, DOJ’s declination letter explicitly credits Cognizant’s compliance program, citing “the existence and effectiveness of the Company’s pre-existing compliance program,...

General

19 Feb, 2019

Reflections on the Cognizant FCPA Resolution: Does DOJ Mean What it Says? (Part III of IV)

It’s easier to fool people than to convince them they have been fooled. — Mark Twain The only difference between reality and fiction is that fiction needs to be credible. — Mark Twain We live in an era where credibility and truthfulness are character values that are often challenged, questioned and indeed overrun. Trust and integrity are values of utmost value and importance. In an...

General

18 Feb, 2019

The Anatomy of a Bribery Scandal: Digging into the Cognizant Bribery Scheme (Part II of IV)

The Cognizant bribery scheme is another in the line of illegal conspiracies orchestrated by senior management – but this one is even more disturbing for a number of reasons. Cognizant’s former president and general counsel directed the scheme in full consultation and with full knowledge and intent with the chief operating officer and the vice president of administration. Add Cognizant to the list of companies...

General

17 Feb, 2019

Tom Fox and Michael Volkov Discuss Cognizant Technologies FCPA SEC Settlement, Declination and Criminal Indictment of Two Executives

Tom Fox and I discuss the recent FCPA enforcement action involving Cognizant Technologies. Cognizant settled FCPA violations with the SEC for approximately $25 million, received a declination from the Justice Department under the FCPA Corporate Enforcement Policy, and Cognizant’s former president and general counsel were indicted for criminal FCPA violations and charged by the SEC with civil violations. Tom and I recorded a podcast to...