Silicon Valley should take note. They are ripe for aggressive FCPA enforcement. The high-tech industry is a risk industry for bribery violations. Yet some say that the high-tech industry is behind the curve when it comes to anti-corruption compliance. The high-tech industry outsources a significant amount of manufacturing. They rely on production and related services in countries where the risk for corruption is extremely high,...
The Justice Department has promised to issue guidance on the meaning of the FCPA and the application of the law to infinite permutations in the real world. As I try to remind everyone, there is little chance that such guidance will resolve many of the more nettlesome issues facing companies, Audit Committees, compliance officers, general counsels and other professionals. The most important point may be the...
For those who like to focus on anti-corruption enforcement and compliance issues, I am sure there are times readers wonder why I post articles about corporate governance. In any company, “tone-at-the-top,” requires good corporate governance. Senior management can do everything necessary to make a compliance program work but without effective governance at the board level, the tone at the top may be drowned out by other problems...
With all of the dangers surrounding healthcare companies, it is worthwhile to develop a targeted compliance plan focused on your significant risks. It is critical to avoid False Claim Act liability. The government’s HEAT strike force effort has been successful in ferreting out fraud and extracting large recoveries for false claims. But the strike force is using sophisticated data mining and data analysis to identify...
With the improving economy, companies are expanding their efforts to look for strategic acquisitions in emerging economies. The potential benefits from such deals are real and it is hard for companies to turn down such opportunities. The success of such a strategy may depend on proactive compliance and realistic risk assessments. Due diligence procedures are even more critical when engaging in an aggressive acquisition strategy....
The headlines these days focus on the SEC whistleblower rules and the implications for corporations. While the whistleblower rules are important and justify vigilant compliance efforts, there is a more significant, and possibly damaging, trend for FCPA enforcement. Corporations now have to consider the risk that the government will conduct wiretaps of target telephones. In the Shot Show sting, the government demonstrated it was willing...
With the new SEC whistleblower rules, companies now face a difficult decision of whether and when to disclose to the SEC and DOJ potential FCPA violations. The issue is not new but the dynamic will certainly be different. For example, when it is clear that whistleblower intends to report allegations to the SEC, the company needs to consider whether to make a pre-emptive report to...
For those companies dedicated to compliance, the first and most critical step is a commitment to empower its compliance office. A company must assign adequate personnel and allocate adequate resources to fulfill its mission. An effective compliance officer must be regarded as equal to, or even senior to, the company’s Chief Financial Officer or General Counsel. Gone are the days when compliance offices are a...
Everyone in the FCPA field knows how to mouth the key words. Practitioners always identify “ongoing assessment” as an essential part of any anti-corruption compliance program. What exactly does that mean? You can define the responsibility for ongoing assessment narrowly or broadly, depending on how much of a commitment you want to make. It is easy to define an ongoing assessment requirement to just an...
As promised, I wanted to address some of the nuts and bolts of a due diligence review of a third party agent. The focus of a due diligence inquiry is “reasonable inquiries” to identify and assess the risks that a third party will engage in bribery. Of course, the specific aspects of the inquiry will change depending on the particular facts surrounding the third party,...
