The Justice Department’s recent enforcement action against Smith & Nephew underscored an important point – companies can be responsible for FCPA violations committed by distributors of the company’s products.  FCPA compliance professionals already knew that the FCPA can apply to distributors. Reams of paper have been used to explain due diligence procedures for third party agents.  These same procedures should be applied to distributors and...

Health care fraud enforcement continues to rack up successes.  Prosecutors are employing aggressive investigative techniques and using non-health care fraud related statutes to prosecute individuals.  At the core of the government’s enforcement strategy is effective interagency collaboration through the Medicare Strike Force and Health Care Fraud Prevention Enforcement and Action Team (HEAT), which consists of representatives from the Department of Justice (DOJ), the Federal Bureau...

Everyone in the compliance community likes to cite the required elements of an anti-corruption compliance program.  The Justice Department and the SEC have described the required elements over and over again in Schedule C of their settlement papers.  Forgive me for deviating a little bit from their script but I have a different take on the principles and the practical steps that are required to...

The term “due diligence” is bandied about among compliance professionals.  Let’s stop a moment and consider the different contexts.  Anti-money laundering “due diligence” is a lot different than FCPA “due diligence.”  FCPA due diligence relates to review of third-party agents for corruption risks or potential acquisitions or joint venture partners for corruption risks. AML due diligence relates to customers (“Know Your Customer” or “KYC”), and...

Everyone in the compliance industry acts like they understand the concept of “transaction testing.”  Next time you are in a meeting and the term comes up; ask one of the nodding heads to explain what it means.  I bet they start to choke up, or you might hear an explanation like “It is when you test your transactions.” In fact, transaction testing is an important...

 Who would have ever guessed that the largest corporate penalty paid in 2012 would be an OFAC enforcement action.  The Justice Department has many major FCPA enforcement actions in the queue awaiting approval and public release, but it will be hard to match the penalty paid by ING Bank for $619 million.  Two days after the ING Bank settlement was announced, OFAC also settled a...