The legal profession is transforming itself, especially in the area of compliance. Lawyers are an invaluable part of a compliance program. They provide important perspective and understanding of risk, they help a company to assess and navigate legal risks and they interface with regulators and enforcement agencies. The most effective compliance programs usually are built around a strong partnership between a chief compliance officer and...
Tom Fox and I recorded a podcast recently on the Johnson Controls enforcement action. In our podcast we discuss a number of issues relating to the Justice Department’s decision to reward Johnson Controls with a declination. You can listen to our podcast here. It is always a pleasure to work with Tom and our discussion centered on a number of issues, including DOJ’s FCPA Pilot...
The messaging behind the need for companies to implement robust compliance programs continues to suffer from a narrow conception of the overall compliance function. It is easy to get lost in the weeds on compliance programs and focus on compliance tasks, policies, resources, assessments and audits. I have promoted a different messaging approach – one that gives full credit and priority to a robust compliance...
We all face a number of risks every day. Yet, we do not respond to each and every risk. We engage in risk-ranking our responses. Some are more risk than others and some are more catastrophic than others. So, we engage in risk ranking each day and allocate our time and attention accordingly. The same applies, or should apply, when managing a compliance program. Resources...
Chief compliance officers face an overwhelming level of risk in the healthcare sector. I do not mean to belittle the risks of corruption, AML, sanctions and other risks typically associated with global companies. Healthcare companies face an extraordinary mix of risks, including fraud, data security, bribery/anti-kickback, and Stark Law violations. The False Claims Act statute is a prosecutor’s dream, and organizations and individuals face extraordinary...
The New York DFS finalized its new AML and Sanctions screening regulations. Interestingly, the NYDFS backed off its original proposal to require a Chief Compliance Officer to certify to a compliance “finding” that the bank or other covered entities maintain an adequate AML and sanctions compliance program. In its place, the NYDFS regulations require an annual certification from senior management, i.e. those responsible for “management,...
There’s something happening here, but what it is ain’t exactly clear – “For What It’s Worth,” Buffalo Springfield At first glance, the SEC’s recent enforcement action against Johnson Controls for $14 million for FCPA violations in China, along with a Justice Department declination under its new Pilot Program, appears to be a “routine” enforcement matter. Unfortunately, this case was anything but routine and there are...
The political campaign season has included plenty of discussion surrounding reforming our criminal justice system, and in particular sentencing for drug offenses. We have not heard much discussion about white-collar criminal sentencing. There is a fair amount of controversy surrounding while collar criminal sentencing as well. Ever since the Supreme Court’s decision in United States v. Booker, in which the Supreme Court relegated the U.S....
The Supreme Court’s decision in the McDonnell case was expected. It was evident that the Supreme Court was going to reverse the convictions when it granted a stay of McDonnell’s sentence and agreed to hear the case. Sometimes we all suffer from FCPA myopia and see the world only through the FCPA lens. The McDonnell case has very little that is directly applicable to the...
Corporate governance issues can quickly divide directors, management and shareholders. For years there has been a continuing debate over the efficacy and importance of shareholder democracy. In theory, and using loaded political words, like “democracy,” activists who promote shareholder democracy usually have strong talking points. Shareholders own a company. Directors and senior managers act as agents for the shareholders/owners. Directors have fiduciary duties to the...
