Tagged: internal controls

25 Feb, 2018

Episode 27 — Internal Controls and Enforcement Risks

The FCPA includes a specific requirement that a public company maintain an adequate set of internal controls. A company’s compliance program is one component of a company’s internal controls. Sarbanes-Oxley expended and reinforced this important requirement. The Department of Justice and the SEC have aggressively enforced the internal controls requirement. The SEC, in particular, has expansively enforced the internal controls requirement even where a failure...

Podcasts

14 Jan, 2018

Episode 21 — Interview of Jean-Michel Ferat, FCPA Forensic Accounting Expert, Senior Managing Director, Ankura Consulting

Jean-Michel Ferat, a leading FCPA Forensic Accountant, and Senior Managing Director at Ankura Consulting, joins Michael Volkov, in Episode 21 of the Podcast, Corruption Crime & Compliance. Jean-Michel Ferat is a leading forensic accountant and has vast experience in uncovering complex bribery schemes and financial crimes. Jean-Michel also works with large, mid-size and small companies to design and implement effective financial accounting controls and remediate...

Uncategorized

8 Nov, 2017

COSO Framework: Breaking Down the Silos and Bringing Everyone Together (Part II of II)

The COSO framework contains important principles for structuring a global organization and its internal controls, including compliance policies and procedures. Compliance officers have to learn and use the COSO framework when communicating and convincing the CFO to embrace a new world with both compliance and financial controls within an effective governance framework. Global companies are recognizing (sometimes slowly) that management silos in a company prevent...

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6 Nov, 2017

CCOs and CFOs: Bringing Everyone Together

Chief compliance officers are politicians and have to possess great interpersonal skills. They have to “get along” and persuade key constituencies — most especially their business partners – to commit and devote time and resources to ethics and compliance. In order to operationalize their programs, CCOs have to build relationships with important partners – human resources, legal, internal audit, procurement, and finance. Up to this...

General

25 Sep, 2017

Ethics and Compliance Controls – Different Means to the Same Objective

People are getting confused. A company’s ethical culture is not a touchy-feely concept that makes everyone warm and cozy all over. At the same time, compliance controls are not hard and fast rules that are mechanically enforced with no regard to purpose or results. I always get frustrated when people like to classify concepts as either black and white. People are uncomfortable with grey concepts,...

General

1 Jun, 2017

Ensuring Compliance with Controls

Let’s start with some basics – a public company is required to implement a set of internal controls. A compliance program is a critical part of a company’s internal controls. A company’s compliance program is only as effective as its board, executives, managers and employees adhere to the compliance policies and procedures. If a company’s constituents do not comply with the compliance program and policies,...

General

6 Mar, 2017

Review, Revise and Re-Organize Your Company’s Internal Controls (Part II of II)

Assuming you made it through Part I of this two-part posting about internal controls, we need to consider a new approach to the design and implementation of internal controls. The first hurdle to overcome, as always, is acknowledgement that a new approach is needed. The CFO and the financial team will inevitable resist because this has long been an area where they are the experts,...

General

5 Mar, 2017

A New Approach to Internal Controls (Part I of II)

The Justice Department and the Securities and Exchange Commission have dedicated more time and energy to understanding a company’s internal controls and enforcing basic requirements that companies maintain effective internal controls. For prosecutors, companies often fall short when it comes to following their internal controls. If you follow my blog, you know that I have often predicted that DOJ will eventually prosecute criminally an individual...

General

31 Jan, 2017

C-Suite Misconduct Results in Sociedad Quimica Y Minera FCPA Resolution with DOJ and SEC

In an unusual FCPA enforcement action, the Justice Department and the SEC resolved FCPA violations against Sociedad Quimica y Minera, a Chilean chemical and mining company, for a total of $30.5 million, for paying approximately $15 million in bribes to Chilean officials. SQM agreed to a deferred prosecution agreement (DPA) with DOJ and to assignment of a two-year independent compliance monitor. The odd aspect of...

Uncategorized

11 Dec, 2016

The SEC’s Continuing Refinement of Internal Controls Enforcement

My good friend and colleague, Tom Fox, has written an interesting post (here) on the SEC’s recent United Airlines settlement for $2.4 million for domestic bribery. As Tom has noted, the interesting aspect of the SEC’s enforcement theory is that United violated its Business Code of Ethics (and Continental’s Code of Ethics, which was in force in 2011 as well), resulting in the failure to...