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Trekking Through Compliance

Trekking Through Compliance – Episode 59 – Investigative Lessons from And the Children Shall Lead

In this episode of Trekking Through Compliance, we consider the episode And The Children Shall Lead, which aired on October 11, 1968, Star Date 5027.1.

Story Synopsis

This episode explores themes of manipulation and the power of belief. The Enterprise crew responds to a distress signal from the Federation colony on Triacus and discovers all the adults dead from an apparent suicide, leaving only the children alive.

Captain Kirk and his team find the children seemingly unaffected and playing happily, which raises suspicion. Dr. McCoy’s medical scans show no physical harm or unusual conditions, but the children’s behavior is concerning. It soon becomes evident that the children are under the influence of an alien entity named Gorgan, who appears to them as a friendly figure promising them power and control. Gorgan manipulates the children to help him take over the Enterprise.

The children use their telekinetic abilities, granted by Gorgan, to take control of the ship, causing chaos among the crew. They create illusions that play on the crew members’ deepest fears, further destabilizing the situation. Kirk and Spock investigate and uncover historical data about the previous encounters with Gorgan and how he exploits the innocence and trust of children to achieve his goals.

Realizing that Gorgan’s power depends on the children’s belief in him, Kirk devises a plan to break his hold. He confronts the children with the truth about their parents’ deaths and shows them how Gorgan has deceived them. The children, seeing the reality of their actions and the consequences, withdraw their belief and support from Gorgan.

Without the children’s belief to sustain him, Gorgan loses power and vanishes. The children, freed from his influence, begin to process their grief and the reality of their situation. The episode concludes with the Enterprise leaving Triacus and restoring order and safety to the ship.

Commentary

I consider this episode the worst episode of the original Star Trek series. The episode, which first aired on October 11, 1968, involves the Enterprise crew investigating the mysterious mass suicide of adults on the scientific colony Triacus and the subsequent manipulation of their children by an alien entity known as the Gorgon. Despite the episode’s shortcomings, Fox identifies key compliance and investigative lessons, including thorough fact-finding, identifying patterns, adapting techniques, engaging with vulnerable parties, addressing ethical dilemmas, and leveraging cross-functional expertise.

Key Highlights

  • Story Synopsis: And the Children Shall Lead
  • Critical Reception and Fun Facts
  • Compliance and Leadership Lessons

Resources

Excruciatingly Detailed Plot Summary by Eric W. Weisstein

MissionLogPodcast.com

Memory Alpha

Categories
Daily Compliance News

Daily Compliance News: July 30, 2024 – The Hidden Debt Edition

Welcome to the Daily Compliance News. Each day, Tom Fox, the Voice of Compliance, brings you compliance-related stories to start your day. Sit back, enjoy a cup of morning coffee and listen to the Daily Compliance News. All from the Compliance Podcast Network.

Each day, we consider four stories from the business world: compliance, ethics, risk management, leadership, or general interest for the compliance professional.

In today’s edition of Daily Compliance News:

  • Mozambique wins the ‘hidden debt’ case.   (Barron’s)
  • The ABA says lawyer’s using AI must heed ethical rules. (Reuters)
  • DOJ says the short seller used bait and switch.   (NYT)
  • Julius Baer was criticized yet again. (Bloomberg)

For more information on the Ethico ROI Calculator and a free White Paper on the ROI of Compliance, click here.

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Innovation in Compliance

Innovation in Compliance: John Byrne and Corlytics – Innovations in Regulatory Compliance

Innovation comes in many areas, and compliance professionals need to be ready for it and embrace it. Join Tom Fox, the Voice of Compliance, as he visits with top innovative minds, thinkers, and creators in the award-winning Innovation in Compliance podcast.

In this episode, Tom speaks with John Byrne, founder and CEO of Corlytics.

John shares his background as a serial entrepreneur focusing on technology and finance and discusses the inception and mission of Corlytics. The conversation delves into the complexities of regulatory compliance, the need for real-time risk assessments, and the integration of AI and machine learning in regulatory monitoring.

John also explores how Corlytics helps financial institutions navigate evolving regulations, including ESG metrics, and forecasts the future regulatory landscape. This episode offers valuable insights for professionals interested in compliance, risk management, and the role of technology in these fields.

Key Highlights:

  • Founding Corlytics and Its Mission
  • Real-Time Risk Assessment
  • Policy Management and Global Compliance
  • Impact of Current Events on Financial Institutions
  • The Rise of ESG in Financial Institutions
  • Future of Regulation and AI

Resources:

John Byrne on LinkedIn.

Corlytics

Tom Fox

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Facebook

YouTube

Twitter

LinkedIn

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Blog

The Proposed Boeing Deal: Part 1 – The Monitorship and Meeting Victims’ Families

The Department of Justice (DOJ) has filed its Plea Agreement in the wake of the Boeing guilty plea. Due to Boeing’s legal challenges, some probation conditions have been imposed to ensure the company adheres to enhanced compliance and safety standards. Over the next few blog posts, I will consider this Plea Agreement, whether it fits the unique situation, and whether it will ensure that Boeing can move forward out of its miasma and the dysfunctional culture at the company. In Part 1, I begin by considering some of these critical conditions around the Monitor, the proposed Monitorship, and the treatment of the victims’ families of the two 737 Max crashes.

Retention of an Independent Compliance Monitor

One condition of Boeing’s probation is the mandatory retention of an Independent Compliance Monitor. This role is compulsory for overseeing Boeing’s compliance efforts, though it’s important to note that the Monitor’s oversight is limited to the activities prescribed in Paragraph 7(j) of the agreement. Perhaps most notably, the DOJ says that the Court will have DOJ no role in the Monitor selection or Monitor oversight. The Monitor will report directly to the DOJ rather than the Court or other independent body, ensuring a lack of transparency.

The Monitor’s responsibilities, selection process, and scope of duties are outlined in Paragraphs 29-37 and Attachment D of the agreement. This setup is designed to reinforce the independence and effectiveness of the compliance oversight. Somewhat counter-intuitively, Boeing’s adherence to the Monitor’s recommendations is not a direct condition of probation, underscoring the Monitor’s role as an independent entity focused on oversight rather than enforcement while at the same time lessening the overall incentives for Boeing to comply with the Monitor’s recommendations.

Safety and Compliance Investment

Boeing must invest at least $455 million in its compliance, safety, and quality programs over probation. This investment represents a 75% increase over the company’s planned expenditures for fiscal year 2024, reflecting that Boeing must commit to elevating compliance standards and then make that investment.

This financial commitment is intended to support internal improvements and implement recommendations from the Independent Compliance Monitor. However, it does not cover the Monitor’s fees and costs, ensuring the funds are dedicated to genuine compliance and safety enhancements. Boeing must periodically, at least annually, provide proof of these investments to the overseeing offices and the Probation Office, ensuring transparency and accountability.

Engagement with Crash Victim Families

In a move no doubt aimed at the families of the two 737 MAX crash victims’,  one of Boeing’s probation conditions includes a mandatory meeting between its Board of Directors and the families of the victims of crashes involving Boeing aircraft. This meeting must occur within four months of sentencing and aims to provide a platform for the families to convey the impact of Boeing’s conduct and offer recommendations for improving the company’s compliance, safety, and quality programs.

Translation Services: Boeing must arrange and pay for interpreters, if needed, covering languages such as Amharic, Bahasa, French, German, Mandarin, and Norwegian.

In-person Attendance: At least 80% of Boeing’s Board members are required to attend in person, although virtual attendance is allowed for those outside the U.S.

Confirmation of Meeting: Within three business days of the meeting, Boeing must confirm with the overseeing and probation offices that the meeting occurred.

You will note that nothing requires Boeing to pay for the travel and accommodations of the victims’ families to this meeting. Equally importantly, nothing requires Boeing to implement any of the victims’ families’ suggestions or recommendations. Given how poorly Boeing has treated the victims’ families and the lack of trust between the parties, it is challenging to envision whether this initiative in the Plea Agreement will satisfy the victims’ families or if Boeing will take any of their recommendations seriously.

These probation conditions imposed on Boeing highlight the importance of independent oversight, significant investment in compliance infrastructure, and direct engagement with affected stakeholders in corporate compliance programs. However, the DOJ has not accepted the premise that it and Boeing need to ‘Go Big‘ in the Monitor or oversight process. What will the Court do with this DOJ approach? Perhaps, but given how this case has gone since the original Deferred Prosecution Agreement (DPA), the Court may want greater oversight, transparency, and a role in the future.

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Compliance Tip of the Day

Compliance Tip of the Day: The Exit Interview

Welcome to “Compliance Tip of the Day,” the podcast where we bring you daily insights and practical advice on navigating the ever-evolving landscape of compliance and regulatory requirements.

Whether you’re a seasoned compliance professional or just starting your journey, our aim is to provide you with bite-sized, actionable tips to help you stay on top of your compliance game.

Join us as we explore the latest industry trends, share best practices, and demystify complex compliance issues to keep your organization on the right side of the law.

Tune in daily for your dose of compliance wisdom, and let’s make compliance a little less daunting, one tip at a time.

Today we consider how a compliance professional can use the exit interview to improve overall corporate culture.

For more information on the Ethico ROI Calculator and a free White Paper on the ROI of Compliance, click here.

To check out The Compliance Handbook, 5th edition, click here.

Categories
Trekking Through Compliance

Trekking Through Compliance – Episode 58 – Ethical Lessons from The Paradise Syndrome

In this episode of Trekking Through Compliance, we consider the episode The Paradise Syndrome, which aired on October 4, 1968, with a Star Date of 4842.6.

Story Synopsis

The crew of the USS Enterprise discovers an idyllic planet inhabited by a peaceful, Native American-like tribe. Captain Kirk, suffering from amnesia due to the effects of an ancient obelisk, is mistaken for a deity by the inhabitants. He begins to live among them, forming a deep bond with a woman named Miramanee, whom he marries.

While Kirk adapts to his new life, the Enterprise faces a critical mission to deflect an asteroid on a collision course with the planet. Spock and McCoy work tirelessly to solve the mystery of the obelisk and restore Kirk’s memory. As the asteroid approaches, Kirk eventually regains his memory, and the truth about the obelisk is revealed: it is a deflector device left by an advanced civilization to protect the planet.

Tragically, Kirk’s return to his true identity and the intervention come too late to save Miramanee. She dies from injuries inflicted by her tribe, who turn against her when the deflector initially fails to work. The episode ends with the asteroid being diverted and a heartbroken Kirk resuming his duties aboard the Enterprise, forever affected by his experiences on the planet.

Commentary

The episode’s synopsis includes Kirk, Spock, and McCoy’s mission to prevent an asteroid from destroying a planet inhabited by Native American tribes. Amidst Kirk’s memory loss and the Enterprise’s struggle to deflect the asteroid, themes of cultural sensitivity, informed consent, and unintended consequences are explored. The discussion highlights five key compliance and ethical lessons: cultural preservation, informed consent, responsibility for unintended consequences, balancing progress with preservation, and maintaining transparency and accountability.

Key Highlights

  • Kirk’s Amnesia and Integration
  • Enterprise’s Struggle with the Asteroid
  • Climax and Resolution
  • Ethical Lessons from The Paradise Syndrome

Resources

Excruciatingly Detailed Plot Summary by Eric W. Weisstein

MissionLogPodcast.com

Memory Alpha

Categories
Compliance Tip of the Day

Compliance Tip of the Day: Separations and Layoffs

Welcome to “Compliance Tip of the Day,” the podcast where we bring you daily insights and practical advice on navigating the ever-evolving landscape of compliance and regulatory requirements.

Whether you’re a seasoned compliance professional or just starting your journey, our aim is to provide you with bite-sized, actionable tips to help you stay on top of your compliance game.

Join us as we explore the latest industry trends, share best practices, and demystify complex compliance issues to keep your organization on the right side of the law.

Tune in daily for your dose of compliance wisdom, and let’s make compliance a little less daunting, one tip at a time.

Today we consider the role of compliance in employee separations and layoffs.

For more information on the Ethico ROI Calculator and a free White Paper on the ROI of Compliance, click here.

To check out The Compliance Handbook, 5th edition, click here.

Categories
Blog

The Foreign Corrupt Practices Handbook: Interview with the Authors

I recently spoke with the Foreign Corrupt Practices Act (FCPA) Handbook authors Robert Tarun and Peter Tomczak from Baker McKenzie for a two-part podcast episode. (Part 1 was posted July 22 here, and Part 2 will be posted July 29 here.)  The depth of knowledge and experience in white-collar crime, particularly about the Foreign Corrupt Practices Act (FCPA), is unparalleled. We delve into the latest edition of their authoritative book, the FCPA Handbook, and explore key compliance trends, challenges, and strategies in today’s global landscape.

Bob and Peter provided a rich overview of their current professional pursuits in our discussion. Bob Tarun is actively engaged with general counsels and white-collar criminal lawyers and continues to contribute significantly to the American Bar Association’s White Collar Crime Institute. He’s also exploring creative writing, having penned a novel involving white-collar crime and an FCPA case, and is working on a screenplay based on a true story of a lawyer turned federal judge who faces indictment and impeachment.

Peter Tomczak chairs Baker McKenzie’s Global Investigations, Compliance, and Ethics Practice. He conducts cross-border compliance investigations and advises on compliance issues, governance, and M&A transactions. Peter also publishes extensively on corporate compliance and governance topics, making significant contributions to the discourse on anti-corruption and ethical business practices.

The Genesis and Evolution of the FCPA Handbook

The FCPA Handbook is often regarded as the bible for practitioners dealing with the complexities of the Foreign Corrupt Practices Act. Bob explained the motivation behind the book’s initial creation: a combination of intellectual curiosity and a perceived gap in the market for practical, hands-on guidance. They aimed to provide invaluable resources to white-collar criminal lawyers, compliance officers, general counsels, and corporate lawyers navigating FCPA-related challenges.

The latest, sixth edition of the handbook comes after significant updates. Peter highlighted the importance of keeping the book current with evolving laws, new DOJ policies, and practical applications in ephemeral messaging and new technologies. The update also addresses recent trends and notable case law, ensuring practitioners can access the most relevant and helpful information.

Writing Process: A Peek Behind the Curtain

Every great book has a unique writing process behind it. Bob emphasized the importance of organization, starting with a detailed chapter outline to ensure coherence and practicality. Each handbook edition incorporates updates on DOJ policies and guidance, reflecting the most current legal landscape.

Peter shared insights into the collaborative nature of their writing process. Both authors would lead on different chapters, exchanging drafts to ensure a unified voice and comprehensive coverage of topics. Despite the challenges of coordinating such an extensive project, the result is a cohesive and well-organized resource for FCPA practitioners.

Key Strategies for Conducting and Defending FCPA Investigations

Conducting and defending FCPA investigations in 2024 involves navigating complex legal and practical challenges. Bob and Peter provided several key strategies:

  1. Effective Document Management: Handling vast amounts of data and ensuring compliance with data privacy laws across jurisdictions is crucial. Early preservation and collection of evidence, including ephemeral messaging, is essential for a robust investigation.
  2. Sophisticated Compliance Programs: The DOJ’s expectations for compliance programs have become more sophisticated. Presentations to the government must demonstrate the underlying crime and prove the company’s proactive compliance measures and readiness to address issues.
  3. Brady vs. Maryland Motions: Bob stressed the importance of detailed Brady motions to ensure the defense receives all exculpatory evidence. This proactive approach can prevent costly and time-consuming retrials due to discovery violations.

International Anti-Bribery and Corruption Trends

Peter comprehensively overviews key international anti-bribery and corruption (ABC) trends. He highlighted the importance of understanding the level of business activity, interaction with governments and state-owned enterprises, the corruption environment, and international cooperation in enforcement efforts.

China remains a focal point for FCPA enforcement. Still, other regions, such as Southeast Asia, the Middle East, and Mexico, are also emerging as critical areas for compliance professionals to monitor. These regions present opportunities and compliance challenges as global supply chains and capital flows shift.

The Future of FCPA Enforcement

Toward the mid-century, Bob and Peter agreed that FCPA enforcement would remain a cornerstone of promoting free and fair markets. Despite significant fines and enhanced compliance efforts, cases involving major corporations like SAP, Ericsson, Glencore, and Goldman Sachs indicate that corruption remains a persistent issue.

Peter emphasized the evolving nature of anti-corruption enforcement as a hallmark of Western democracy. He suggested that future enforcement may increasingly target the demand side of global bribery, addressing both the supply and demand aspects of corruption.

Our conversation with Bob and Peter underscores the importance of staying abreast of FCPA enforcement’s latest trends, policies, and strategies. Their handbook serves as a vital resource for compliance professionals, offering practical guidance and insights into the complex world of anti-corruption compliance.

The sixth edition is available through the American Bar Association for those interested in delving deeper into the FCPA Handbook. Bob and Peter can also be reached through their contacts for further inquiries and professional guidance.

Categories
All Things Investigations

All Things Investigations: Tom Lee on Invalidation of The Chevron Deference

Welcome to the Hughes Hubbard Anti-Corruption & Internal Investigations Practice Group’s podcast All Things Investigation. In this podcast, host Tom Fox welcomes back Tom Lee to take a deep dive in the Supreme Court’s invalidation of the Chevron deference and what it means going forward.

In this episode, special counsel Tom Lee joins the podcast to discuss the Supreme Court’s recent decision in the Loper Bright case, which overruled the long-standing Chevron deference. Lee explains the implications of this ruling on how courts interpret ambiguous statutory terms and provides insights into the decision’s grounding in the Administrative Procedure Act rather than the Constitution. He also discusses the potential impact on past cases decided under Chevron, future regulatory challenges, and the strategic considerations for companies navigating the new legal landscape. Throughout, Lee offers a thorough analysis of the evolving legal environment and its consequences for administrative law.

Key Highlights

  • Overview of the Loper Case and Chevron Deference
  • Supreme Court’s Decision and Its Implications
  • Consequences of Overruling Chevron Deference
  • Future Challenges and Legal Strategies
  • Administrative Procedures Act and Its Impact

 Resources:

Hughes Hubbard & Reed website

Thomas Lee

HHR Client Alert-Litigation After the Demise of Chevron Deference

Categories
Corruption, Crime and Compliance

NAVEX State of Risk and Compliance Programs

Is your HR department rolling their eyes at compliance? Does your company have a non-retaliation policy? The report, based on over 1,000 global responses, reveals growing maturity in compliance programs but notable gaps, such as only 61% having a hotline and 55% having a non-retaliation policy.

Join us on this week’s Corruption Crime and Compliance to learn how cross-functional relationships are strong with data privacy and risk but weak with HR and finance. Michael Volkow highlights NAVEX’s report, showing compliance’s high engagement in processes like reputational harm and data breaches but often being involved late in mergers and acquisitions.

Learn that common compliance issues include privacy, cybersecurity, and regulatory demands. The report also covers ESG programs and the need for better third-party risk management – tune in to hear more!

You’ll hear him talk about:

  • How compliance is often brought in late during mergers and acquisitions, with 20% of respondents noting no engagement in these processes.
  • Notable gaps that include only 61% of organizations having a hotline or whistleblower internal reporting channel and only 55% having a non-retaliation policy.
  • How the report shows progress in the maturity of compliance programs, with half of the respondents rating their programs in the top two tiers of maturity.
  • Compliance having strong relationships with data privacy and risk functions but experiencing significant resistance from HR and finance departments.
  • Half of the organizations experiencing at least one compliance issue in the past three years, with privacy and cybersecurity being the most common issues.
  • Two-thirds of boards receiving periodic compliance reports, but one-third do not, highlighting a need for improved board engagement in compliance matters.

Resources:

Michael Volkov on LinkedIn | Twitter

The Volkov Law Group

Navex State of Risk and Compliance Report