Just like the ups and downs of the business cycle, SEC enforcement of accounting fraud cases follow an up and down trend as well. For example, during the financial crisis, SEC enforcement of accounting fraud cases took a back seat to enforcement actions surrounding disclosure and conflicts of interest in relation to the financial meltdown. The SEC, in the last two years, has returned to...
A number of companies have adopted the requirement that a new Chief Compliance Office come from the ranks of former federal prosecutors. I am not sure exactly why companies have adopted this requirement. Perhaps company leaders think this will give the company an advantage when dealing with the Justice Department or the SEC. With full disclosure here, I admit my bias in favor of federal...
Maybe I am a Luddite; maybe I just do not understand the new world and the impact of globalization. New ideas do not scare me, like others we know. New ideas present real opportunities for progress and innovation. I understand the impact that globalization has had on our economy, our society and our country. There are many positive benefits that flow from this incredible transformation...
Since 2010, the Justice Department and the SEC have been “investigating” a number of private equity and hedge funds for FCPA violations. The launch of the inquiries was a big deal with lots of fanfare and focus on private equity corruption risks. In time, nothing happened. Well, that is about to change. DOJ and the SEC are getting close to announcing a large settlement with...
Let’s start with a big “If.” I know that sounds like a real turn off but bear with me. Assuming that the Justice Department is ready to turn over a new approach to criminal enforcement and aggressively prosecute culpable individuals in white collar crime investigations, would it be a good idea to offer a pass, or leniency to the company if the company self-reports the...
Just to add to the cacophony of voices campaigning during this primary season, DOJ, SEC, FINRA, and CFTC officials launched their own campaign promoting recent initiatives to increase corporate self-reporting of potential violations. After months of announcements, which were preceded by internal wrangling and bureaucratic leaks, DOJ has put in place its new initiative – the Yates memorandum to focus on individual culpability and a...
How to Conduct FCPA Audits May 4, 2016, 12 Noon EST Sign Up Here As companies implement anti-corruption compliance programs, the need for auditing and monitoring of their compliance programs increases. Companies have to structure an audit program to address significant risks and to identify potential weaknesses and problems. Mitigating those deficiencies can be a real challenge. Join Michael Volkov, CEO of The Volkov...
William Shakespeare’s Hamlet included this often used phrase – hoist with his own petard (a small bomb). Shakespeare never knew that his eloquence would apply to today’s SEC enforcement of internal controls. The FCPA requires companies to make and keep accurate books and records and to devise and maintain an adequate system of internal accounting controls. The FCPA also prohibits individuals and businesses from knowingly...
The SEC continues its cutting edge FCPA enforcement program, bringing in a variety of enforcement cases and employing some new strategies. In its latest foray, the SEC settled with Las Vegas Sands, owned by Sheldon Adelson, for $9 million for deficiencies in its internal accounting controls concerning its operations in China and Macao. The SEC’s enforcement action reflects one important theme – they could not...
Hui Chen, the Department of Justice’s Compliance Counsel, recently stated that 2015 was the year of due diligence and third-party compliance. A recent survey conducted by Kroll and Ethisphere provided a status check on how the due diligence compliance effort is going. Many companies have heard the message about the importance of due diligence compliance and instituted due diligence systems, hopefully using automated programs. Companies...
