Corruption, Crime & Compliance

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10 Aug, 2023

Justice, Commerce and Treasury Departments Issue Comprehensive Tri-Party Voluntary Disclosure Guidelines for Sanctions and Export Control Violations

In another significant step notifying global businesses of the new realities – companies are about to face aggressive coordinated criminal and civil prosecutions for sanctions and export control violations. The last piece in launching this new effort was the announcement of a joint voluntary disclosure program to ensure alignment among the agencies for civil and criminal enforcement of such violations. The Joint Compliance Note (“JCN”)...

General

8 Aug, 2023

SEC Adopts Robust New Cybersecurity Disclosure Rules

In late July 2023, the Securities and Exchange Commission (“SEC”) adopted new rules requiring public companies to disclose cybersecurity incidents and cybersecurity governance policies and practice. The SEC largely adopted its original proposal issued in March 2022, with some modifications applicable to cybersecurity disclosure requirements. The SEC voted to adopt the new rules in a 3-2 vote. The new disclosure requirements however are effective no...

General

7 Aug, 2023

Do You Have an Effective Internal Investigation Program? (Part III of III)

Chief Compliance Officers are truth-tellers. It comes with the territory. Each and every CCO knows whether its internal investigation program is effective or not. There is not a lot of grey in this area – CCOs know what an effective internal investigation program looks like and they can quickly spot a weak one. This comes from experience. Too many companies fail to understand how valuable...

Podcasts

7 Aug, 2023

Episode 284 — How to Implement a Compliance Compensation System

The Justice Department’s recent revisions to its Corporate Enforcement Program and its Evaluation of Corporate Compliance Programs stressed the importance of compensations systems and consequence management. The theoretical underpinning of DOJ’s expanded focus is to increase the consequences to individuals who engage in misconduct or supervisors who turn a blind eye to misconduct. Individuals already face potential criminal prosecution for engaging in misconduct but the...

General

4 Aug, 2023

The Key Elements of an Employee Reporting System (Part II of III)

Corporate leaders know what to say and when to say it – for example, a CEO may state at an employee meeting, “We want to hear your concerns. We want you to bring these concerns forward and we will address them. We are committed to this as part of ethical culture.” The CEO’s comment is all well and good – it is a positive step...

General

3 Aug, 2023

A Robust Consequence Management System (Part I of III)

The Department of Justice has laid down a marker – companies would be smart to understand the significant change in ethics and compliance program expectations. Companies that ignore this new landscape are gambling with their financial security and their reputational value. Every company that has suffered through a DOJ investigation knows how damaging and draining such an experience can be. The purpose of an ethics...

General

1 Aug, 2023

Quarterly Trade Compliance Update – July 2023

Each quarter, we send many of our clients a quarterly trade compliance update, highlighting important developments over the last few months and summarizing key points for important sanctions programs. Click here to download the quarterly update for July. Below is a summary of events this past quarter: About the document: This handy one-pager is designed to be used by our clients to provide a quick...

General

31 Jul, 2023

U.S. Department of Justice Unseals Indictment against Celsius Network’s Alexander Mashinsky

On July 13, 2023, U.S. prosecutors unsealed an indictment against Alexander Mashinsky, the founder and former CEO of beleaguered Celsius Network LLC (“Celsius”) charging him with securities fraud, commodities fraud, and wire fraud. The DOJ alleges that Mashinsky defrauded customers by misleading them about Celsius’s operations, specifically related to the company’s success and profitability, along with the investments that Celsius ultimately made utilizing customer funds. ...

Podcasts

31 Jul, 2023

Episode 283 — Bank of America Hit with $250 Million Penalty for Consumer Account Abuse

Bank of America joined the club of consumer abusers – Wells Fargo had been the well-established leader of this club and the poster-child for abusive consumer practices. For years, Bank of America avoided federal enforcement for abuses and could distinguish itself from the poster-child, Wells Fargo. Bank of America’s conduct is inexplicable. In response to the Wells Fargo scandal, you would have expected that Bank...

General

26 Jul, 2023

Ripple and the SEC Both Claim Wins in Split Court Decision

On July 13, 2022, Judge Analisa Torres issued her long awaited ruling on the summary judgment motions in the SEC’s case against Ripple Labs, Inc. (“Ripple”). The 34-page order provided a win for both the SEC and for Ripple Labs, suggesting that some sales of Ripple’s XRP token constituted securities, but that other sales did not. Proponents of the cryptocurrency industry celebrated this ruling, as...