Tagged: risk management

Retaining a “Risky” Third-Party

Every company has done it. Chief Compliance Officers have had to hold their respective noses and push forward with due diligence to retain a risky third party. Rather than reject the third party, a CCO convinces him or herself that the company can mitigate the risks by contract representations and warranties, annual certifications, and a plan to monitor and audit the third party in the...

When Diligence is Not Given its “Due”

I find myself quibbling with compliance terms – hyper focus on small issues is not a positive trait. I often urge clients and colleagues to focus on issue of more significance and leave the smaller ones for another day. Hence, my recent criticism over “due diligence” policies and procedures for third party intermediaries. A more appropriate title is “risk management.” A due diligence inquiry of...

Third Party Risk Management Not Just Due Diligence

The term “due diligence” is an overused expression in the compliance world. It has become a term to mean heightened concern or investigation. No one can really define what it means except to say it has different meanings in different contexts. Some would say it is a term of art in the legal and compliance world. It is misleading to add the term “investigation” to...

Webinar: Cutting Edge Issues in Third Party Risk Management

July 26, 2016, 12 Noon EST Sign Up Here Global companies continue to elevate their due diligence and audit programs to mitigate third party risks. With the advent of new technology platforms and improved information collection products, global companies need to “stay ahead of the curve” when it comes to managing third party risks. Global companies face a variety of third party risks depending on...

AML Risks and Foreign Correspondent Banking

With the Panama Papers scandal and government promises of continued aggressive AML enforcement, financial institutions face a variety of risks that require increased vigilance and mitigation strategies. One of the most challenging risks facing all financial institutions is foreign correspondent banking. In essence, a foreign correspondent banking relationship is built on the effectiveness of a foreign bank’s AML compliance program and ongoing monitoring capabilities. Such...

Global Construction and Corruption

With increasing focus on infrastructure projects and greater public demand for improvements, governments are preparing to ramp up construction projects. Part of the budgeting process has to acknowledge the cost of corruption. It does not take a rocket scientist to figure out that construction and corruption go hand-in-hand. Corruption occurs in construction projects because of the incendiary mix of money, government bureaucracy, and lack of...

Corruption Risks and Corporate Social Responsibility Spending

Global companies have been embracing socially responsible spending projects to build stronger relationships with local communities. The idea makes a lot of sense and real projects can result in real benefits. As with any significant source of money, there are risks. Major global companies have been caught in some embarrassing situations, some of which can have real legal and reputational consequences. Think of the irony...

Learning from Schlumberger’s Mistakes: Doing Business Under Iran General License H

Lauren Connell, Managing Associate at The Volkov Law Group, rejoins us for a posting on sanctions compliance.  She can be reached at lconnell@volkovlaw.com. Implementation Day has been hailed as a new stage in Iran-US relations. There has been significant media coverage of how sanctions are being lifted, with various outlets suggesting that Iran is now “open for business.” In reality, that is far from true....

Beneficial Ownership: Sanctions and FCPA Compliance

Financial institutions have been pushing back hard on FinCEN’s proposal to require banks, investment banks and other financial institutions to identify beneficial owners of account holders. As time goes on the impact of FinCEN’s proposal is diminishing. Why? In general, businesses have other reasons to secure beneficial ownership information. One key concern is sanctions compliance. To the extent an account holder engages in international transactions,...

Cyber Security Compliance: The Role of the CCO

For years, cyber security has been the province of IT specialist and technicians. Those days are long gone. If you ask a Board of Directors to identify a company’s most significant risk – cyber security is tops. That is no big surprise. When you consider the consequences of a cyber intrusion or a more likely breach, companies suffer serious reputational and financial harm. Directors, senior...