In today’s edition of Sunday Book Review:
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CONVERGE is in its 5th year of bringing together the world’s leading companies for 2 days of dynamic speakers, thought-provoking breakout sessions, and opportunities to connect with like-minded professionals. This year the conference has gone virtual. You will leave the conference with new resources and best practices allowing you to continue the hard work of driving ethics to the center of your business. In today’s episode I visit with Adelle Elia. We visit about her presentation at Converge20 on Integrity v. Compliance: the Future of Our Profession.
As a profession, we’ve gotten used to the “ethics and compliance” label—but the rise of the Chief Integrity Officer begs the question, “is Integrity the new E&C?” Adelle Elia for a session on creating a more approachable team that’s fully connected to everyday operations across the organization. You’ll learn how meaningful company values, employee communications and organizational structures can propel a program to align a culture of integrity and ethics and make a significant impact on the bottom line. For more registration and information on Converge20, click here.
Welcome to the fifth and final episode of a special five-part podcast series, sponsored by Exiger, on topics From Third-Party Risk Management to Supply Chain Risk Management: Exiger on the Evolution in Supplier Compliance in COVID. Exiger was founded to fight financial crime, fraud and terrorist financing by introducing technology-enabled solutions to the market’s biggest supply chain, risk, investigation, litigation, and compliance challenges. A global authority on risk and compliance, Exiger serves the world’s largest banks, Fortune 1000 companies and government agencies and regulators. Over the past five episodes, we have put a spotlight on Financial Institutions with Tara Loftus and Samar Pratt; focus on corporations with Aaron Narva and George ‘Ren’ McEachern; consider the Federal Government and Supply Chains with Carrie Wibben and Vishnu Anantatmula; review the pillars of good compliance with Brandon Daniels and Carrie Wibben; and end with a review of third-party risk management solutions with Erika Peters and Skyler Chi.
Today, Part 5, we conclude with a review of third-party risk management solutions with Erika Peters and Skyler Chi. Peters is an Associate Managing Director based in Exiger’s New York office, where she focuses on the firm’s financial crime compliance and assurance practices. Chi is an Associate Director based in Exiger’s New York office. With nearly ten years of forensic accounting and investigative experience he leverages world-class technology (e.g., SQL, Python, Tableau, natural language processing and machine learning) in order to aid in financial investigations and government clients in bank/investment statement reviews and analyses, data analysis efforts, large document analyses, and extensive e-mail reviews.
For more information on Exiger, click here.
For more information on Erika Peters, click here.
As Donald Trump blames the California and Oregon forest fires on ‘trees gone bad’; Tom and Jay continue to brave the surge in Covid cases by staying safe at home. They are back to look at top compliance articles and stories which caught their eye this week.
- How does Bluebell apply to cyber claims against a Board of Directors? Paul Ferllio, Bob Zukis and Christophe Veltsos in the Harvard Law School forum on Corp Governance.
- VW Monitor closes out monitorship. Jack Ewing in the NYT. Mengqi Sun in the WSJ Risk and Compliance Journal.
- Tom takes a deep dive into Herbalife. Part 1, Part 2, Part 3 and Part 4.
- The intersection of anti-human trafficking and ABC compliance. Vanessa Hans in the FCPA Blog.
- Does the DOJ have to turn in SEC investigative material in a criminal FCPA trial? Matt Kelly goes legal in Radical Compliance.
- The intersection of compliance and internal audit? Mike Volkov in Corruption Crime and Compliance.
- Who is a PEP? Dick Cassin considers a plethora of definitions in the FCPA Blog.
- Has Covid-19 changed the relationship between senior management and the Board? Dottie Schindlinger and Kira Ciccarelli in CCI.
- This month on The Compliance Life, I am joined by DeAnna Nwankwo. In this week’s Part 2, DeAnna talks about some of the skills she needed in the CCO chair.
- On the Compliance Podcast Network, on 31 Days to a More Effective Compliance Program, this month focuses on internal controls. This week saw the following offerings: Monday– Internal controls for 3rd parties; Tuesday– Internal controls for GTE; Wednesday– BOD oversight as an internal control; Thursday– Code of Conduct as an internal control; and Friday– What is the COSO Internal Controls Framework. The month of August is being sponsored by Affiliated Monitors. Note 31 Days to a More Effective Compliance Program now has its own iTunes channel. If you want to binge out and listen to only these episodes, click here.
- Join Jay and Tom at Converge20. Convercent’s top compliance conference is going virtual this year. Check at the agenda and register here.
- Join a great upcoming K2 Intelligence FIN webinar. Robin Henry on how investigators can use social media, Thursday, 9-24 at 1600 GMT. Registration and information here.
- Join Tom, Charlie Voelker, Legal Compliance Solutions, Skillsoft and Stephen Martin, Partner, StoneTurn for a joint Skillsoft/StoneTurn webinar on evolving your compliance program under the 2020 Update to the Evaluation of Corporate Compliance Programs. Wednesday, September 23, from 12 PM – 1 PM EDT. Information and registration here.
Tom Fox is the Compliance Evangelist and can be reached at tfox@tfoxlaw.com. Jay Rosen is Mr. Monitor and can be reached at jrosen@affiliatedmonitors.com.
In this special podcast series, sponsored by Affiliated Monitors, Inc. (AMI); I am joined by AMI Managing Director Rod Grandon. We will be considering the responsibility of federal contractors to maintain their status as “Responsible Contractors” and explore the benefits of having an effective compliance and business ethics program not only to increase business efficiencies and profitability but prepare you in good stead if the regulators come knocking. In this episode, we introduce the concept of Responsible Contractors.
In this series, we examine the impact of two key Federal Acquisition Regulations (FARs), FAR3.1002 and FAR 52.203-13, Contractor Code of Business Ethics and Conduct, in the context of other authorities relating to corporate integrity programs, along with proactive steps contractors can take to better position their companies should federal enforcers come calling. It has certainly been Grandon’s experience that companies that proactively embrace robust ethics and compliance programs tend to become better companies for their employees and customers. Grandon emphasized that the government is focused on what it terms “responsible contractors”. While there is no FAR laying out the definition of this term, Grandon noted it has come to have a very broad meaning.
First, it addresses performance characteristics that a responsible contractor “should have the ability to perform as it said that it would perform pursuant to its contract.” This includes a contract with goods or services. It is beyond ethics and compliance “as it encompasses the concept that a contractor should have the financial wherewithal to complete the contracted task, the facilities or physical plant to perform the work, accounting systems and purchasing systems that are up to the task, property management systems, and all other such systems should be in place. It also means having a workforce that is capable of performing. Finally, it also includes a workforce that is committed to compliance and promoting all they do with integrity.”
CONVERGE is in its 5th year of bringing together the world’s leading companies for 2 days of dynamic speakers, thought-provoking breakout sessions, and opportunities to connect with like-minded professionals. This year the conference has gone virtual. You will leave the conference with new resources and best practices allowing you to continue the hard work of driving ethics to the center of your business. In today’s episode I visit with Ian Foxley. We visit about his panel at Converge20 on Whistleblower Protection: The Dawn of the Next Era.
Foxley’s dramatic whistleblower tale brings life to what could otherwise be—and often is—an abstract conversation about the appropriate response to whistleblowing. Join this panel for an enlightening conversation about the theory of whistleblowing, how it differs in practice, and how compliance professionals can lay the groundwork for an ethical response. For more registration and information on Converge20, click here.
In 2016, one of the most interesting non-international focused FCPA enforcement actions was announced by the SEC. It involved a clear quid pro quo benefit paid out by United Airlines, Inc. to David Samson, the former chairman of the Board of Directors of the Port Authority of New York and New Jersey, the public government entity which has authority over, among other things, United’s operations at the company’s huge east coast hub at Newark, New Jersey.
The reason that it is so interesting from an enforcement prospective is that it is not foreign corruption but domestic corruption, therefore not subject to the foreign government official requirement of the FCPA. However, the actions of United’s former CEO, Jeff Smisek, in personally approving the benefit granted to favor Samson violated the company’s internal controls around gifts to government officials. That sounds suspiciously like a books and records violation of the FCPA. The $2.4 million civil penalty levied on United was in addition to its NPA settlement with the DOJ, which resulted in a penalty of $2.25 million. Former Chairman Samson also pled guilty for putting pressure on United to reinstitute a flight service which was near his weekend residence.
At the time, United’s Code of Conduct prohibited “United employees from directly or indirectly making bribes, kickbacks or other improper payments to government officials, civil servants or anyone else to influence their acts or decisions” and that “[n]o gift may be offered or accepted if it will create a feeling of obligation, compromise judgment or appear to improperly influence the recipient.” Only the United Board of Director’s could grant a waiver to the code and none was sought or obtained by Smisek. The Order concluded, “The [Chairman’s] Route was initiated in violation of United’s policies.”
Three key takeaways:
- It is very unusual for the FCPA to form the basis of a domestic bribery violation.
- A Code of Conduct can be an internal control.
- Even a CEO must follow internal controls.
Welcome to a special five-part podcast series, sponsored by Exiger, on topics From Third-Party Risk Management to Supply Chain Risk Management: Exiger on the Evolution in Supplier Compliance in COVID. Exiger was founded to fight financial crime, fraud and terrorist financing by introducing technology-enabled solutions to the market’s biggest supply chain, risk, investigation, litigation, and compliance challenges. A global authority on risk and compliance, Exiger serves the world’s largest banks, Fortune 1000 companies and government agencies and regulators. Over the course of the series, we will put a spotlight on Financial Institutions with Tara Loftus and Samar Pratt; focus on corporations with Aaron Narva and George ‘Ren’ McEachern; consider the Federal Government and Supply Chains with Carrie Wibben and Vishnu Anantatmula; review the pillars of good compliance with Brandon Daniels and Carrie Wibben; and end with a review of third-party risk management solutions with Erika Peters and Skyler Chi.
In Part 4, we consider the pillars of good compliance with Brandon Daniels and Carrie Wibben. Wibben is a Senior Vice President, National Security & Intelligence, based in Exiger’s McLean office. As the former Deputy Director of the Defense Counterintelligence and Security Agency (DCSA), Carrie joins Exiger following a distinguished career in homeland defense spanning various government agencies – including the US Department of Defense, the Executive Office of the President, and the Special Security Directorate. Brandon Daniels is the President of Global Markets. A regulatory expert and technology practitioner, Brandon brings more than 15 years in senior management across the financial services, life sciences and energy sectors. He has a reputation for technological innovation in regulatory investigations and compliance management.
Join us tomorrow where we conclude our five-part series by looking at some of the new challenges and new solutions for third party risk management and investigations.
For more information on Exiger, click here.
For more information on Brandon Daniels, click here.
For more information on Carrie Wibben, click here.
