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Howard Sklar's Convergence: Export Controls and the FCPA

Howard Sklar's Convergence: Export Controls and the FCPA

Howard Sklar Last year, the U.S. government imposed record penalties of nearly $2 billion in the FCPA and $1 billion in various penalties for U.S. sanctions and export controls. In some cases, these violations “converged” – meaning they arose from similar deficiencies in a company’s compliance program. For those companies that engage in international business, they need to focus on the FCPA’s prohibitions on the...

The Critical Compliance Gatekeeper — The Internal Auditor

The Critical Compliance Gatekeeper — The Internal Auditor

It is unfortunate but true – compliance actors in a company can sometimes engage in internal turf battles which undermine overall compliance efforts. Every organization suffers from internal inefficiencies caused by personalities, protecting spheres of influence and sometimes, even organizational insecurities. Without trying to insult general counsels and even compliance officers, the internal auditor in a company is uniquely positioned to identify corruption risks. All...

Congress and Corruption: Practicing What They Preach?

Congress and Corruption: Practicing What They Preach?

In the aftermath of the debt ceiling fiasco, Congress’ reputation took another blow in the court of public opinion. Even before the debt ceiling brinkmanship, Congress’ record on ethics was getting trampled through the mud yet again. Washington is a city filled with double standards and perhaps there is no better one when you compare the new and aggressive enforcement policies which have been launched...

When Does the SEC Act and the Justice Department Decline to Act?

When Does the SEC Act and the Justice Department Decline to Act?

With the recent Diaego settlement of FCPA charges, the question arises – when does the SEC act while the Justice Department declines to act? More accurately, when does the SEC see an FCPA violation which the Justice Department does not see? The easiest answer to the questions is burden of proof: The SEC has civil responsibility, meaning a preponderance of evidence; and the Justice Department...

Corporate Boards and Risk Management

Corporate Boards and Risk Management

We always hear about the Corporate Compliance Officer, the Audit Committee or the Compliance Committee, if a company has created one, and how they are all supposed to act.  But let’s look at the most important actor of them all — the Corporate Board.  Of course, there are numerous corporate committees which have important responsibilities, but in the end, when the rubber meets the road,...

How Far Should AML Laws Go?

How Far Should AML Laws Go?

For “financial institutions” (banks, mutual funds and broker-dealers), AML compliance requirements are established by statutes and regulations implemented by the Department of Treasury.  These entities are required to adopt a written AML program that includes policies and procedures reasonably designed to detect and cause the reporting of suspicious transactions, designation of an AML compliance officer, regular and independent auditing/testing of the AML program; and a...

Do DPAs and NPAs Promote Balanced Justice?

Do DPAs and NPAs Promote Balanced Justice?

In the Bush Administration, the Justice Department turned deferred prosecution agreements (DPAs) and non-prosecution agreements (NPAs)into relevant terms for defense counsel.  Now, even the SEC has joined the club entering into the first DPA and NPA. The distinction between a DPA and an NPA is critical — the DPA invokes the Court’s supervisory jurisdiction and requires the Justice Department to lodge a criminal information to charge the...

DOJ's Expansive View of "Obtain or Retain Business"

DOJ's Expansive View of "Obtain or Retain Business"

The News Corp scandal has focused attention on the interpretation of the FCPA element which requires that bribes be paid (or attempted) to “obtain or retain business.”  Some commentators have claimed that the News Corp facts cannot satisfy this element because the bribes paid to police officers were made for “information.”  In the past few years, the SEC and DOJ have broadly interpreted the “obtain or...

Russia: The Anti-Bribery Frontier

Russia: The Anti-Bribery Frontier

More multinational companies are expanding into Russia.  China has become passe.  Years ago, every company was considering expanding into China.  Now, Russia is the new frontier.  India is a close second on the frontier competition.     China and India pose real corruption risks.  Corruption is built into China’s government and social fabric.  India has extensive layers of government regulation and market structures which increase corruption risks. Russia presents...

Criminal Antitrust: The Continuing Risk

Criminal Antitrust: The Continuing Risk

While everyone is focused on anti-corruption enforcement and compliance issues, global antitrust enforcement continues as a significant risk.  Over the last few years the most important trend has been the rising role of European antitrust enforcement against cartels and imposition of higher fines.  Even with this steady rise in European enforcement, US criminal antitrust enforcement has returned in 2011 from a slower 2010.   The pace...