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This Week in FCPA

Episode 177 – the Natitude edition

As Tom steadies himself for the Astros to head to Washington and the Nationals home park, he and Jay reflect on some of this week’s top compliance and ethics stories which caught their collective eyes.

  1. SEC examiner (allegedly) steals confidential information on company investigation, then leaves SEC to become company’s CCO. Dylan Tokar reports in WSJ. Matt Kelly opines in Radical Compliance.
  2. What are the data privacy considerations in investigations. Cleary Gottleib lawyers in NYU’s Compliance and Enforcement
  3. Are you looking at your 3rd parties for data protection issues? Adam Hill in NYU’s Compliance and Enforcement
  4. What are the stakes for corporate wrongdoers? Dan Portnoy in the Grand Jury Target.
  5. What are 5 common weaknesses in OFAC Compliance programs. Mike Volkov explains in Navex Global’s Ethics and Compliance Matters
  6. Whats, whys and hows in M&A assessment. Jay starts a new series on CCI.
  7. Why is understanding behavioral science critical for a compliance programs? Jeff Kaplan dissects it in the FCPA Blog.
  8. Why is a speak up culture hard to find. Dick Cassin explains in the FCPA Blog.
  9. AI and internal audits. Kevin Alvero and Randy Pierson on CCI.
  10. Avanir engages in corruption in the US. Not FCPA but FCA violation. Mike Volkov explains on Corruption, Crime and Compliance.
  11. Tom had a great group of top notch podcasts, on the CPN this week. Check out the following lineup: FCPA Compliance Report– Francine McKenna on the KPMG-PCAOB mess; Innovation in Compliance-ReThink Compliance on why content is still king in compliance; #GWIC with Barbara Petitti; 12 O’Clock High– how the leadership of JP Morgan halted the Panic of 1907; Life with GDPR– Brexit and Compliance. The podcast will be available on multiple sites: the FCPA Compliance Report, iTunes, JDSupra, Megaphone, YouTube,  Spotify and theCompliance Podcast Network.

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.
For more information on how an independent monitor can help improve your company’s ethics and compliance program, visit our sponsor Affiliated Monitors at www.affiliatedmonitors.com.

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Daily Compliance News

October 25, 2019-the Every Boy Needs Toys edition

In today’s edition of Daily Compliance News:

  • Toys of the corrupt super-rich. (The Guardian)
  • Astros fire Brandon Taubman. (com)
  • VA used whistleblower office to attack whistleblowers. (WSJ)
  • Citgo gets a lifeline. (NYT)
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Great Women in Compliance

Barbara Petitti, When Change is a Consistency in a Compliance Program

Welcome to the Great Women in Compliance Podcast, co-hosted by Lisa Fine and Mary Shirley. For some compliance professionals, sometimes the only constant is change. Today, Lisa speaks with Barbara Petitti, Ethics & Compliance Officer, Policy Enforcement and Investigations at Alstom. Barbara started in compliance through a role in Human Resources with a defense contractor and joined Alstom, a French transportation company, seven years ago.
When Barbara started at Alstom, they were in the midst of addressing serious corruption issues which included investigations with the World Bank, the U.S. Department of Justice and the UK Serious Fraud Office. During this time several executives were indicted by the DOJ and ultimately Alstom paid a $772m criminal penalty to the US Department of Justice.
That was the start of her story. Since Barbara started at Alstom. Her role evolved, and she addressed changes. Here are a few:

  • Having seven bosses in six years;
  • Acting as North American Compliance Officer for three entities;
  • Traveling globally 30-40% of the time to lead global initiatives; and
  • Supporting Alstom when there were 100,000 employees as well as with 35,000 employees.

Join the Great Women in Compliance community on LinkedIn here.

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12 O’Clock High-a podcast on business leadership

The Panic of 1907 and Leadership of JP Morgan

I recently listened to the Great Courses series of lectures entitled, Crashes and Crisis: Lessons form a History of Financial Disasters, hosted by Professor Connel Fullenkamp. Although the lecture series focused on economic disasters, I found many leadership lessons embedded in the lecture. In prior podcasts, host Richard Lummis and myself have considered the Dutch Tulip Bubble from the 1630s, the South Sea Bubble of 1720 and the Mississippi Bubble of 1720.   Today we conclude with the Panic of 1907 and see how one person’s integrity and leadership can actually work to stop a panic and save a national economy.
While there were obviously many moving parts to stopping the Panic of 1907, with the personal integrity of JP Morgan and his knowledge of the domestic and international financial markets, it is very doubtful the Panic could have been stopped. If the Panic had been allowed to spread unchecked it likely could have brought down the entire US economy. This example shows that the right person, at the right place, at the right time can make all the difference.

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Everything Compliance

The Not Headed to Doral edition

Welcome to the only roundtable podcast in compliance. Today, we have a quintet of Jay Rosen, Matt Kelly, Sarah Hadden, Jonathan Armstrong and Mike Volkov with a potpourri of topics and commentary on current events from the compliance perspective. Rants and shouts outs follow the commentary for this episode, with one public service announcement from across the pond.

  1. Mike Volkov takes a deep dive into the debate on whether a Chief Compliance Officer should report to the GC or not. Volkov shouts out to Harvard Law Professor Matthew Stephenson for his great blog site Global Anti-Corruption Blog and specifically his recent blog post, If You Don’t Think Conflicts of Interest Matter, Consider the Kurds.
  2. Jay Rosen discusses the role ethics and compliance in the Mergers and Acquisition process. Rosen shouts out General James Mattis’ and his remarks at the Alfred Smith Dinner where accepted Trump’s claim he was the ‘most-overrated general’ by noting Trump had said 3-time Oscar winner Meryl Streep was the ‘most-overrated actress.’
  3. Sarah Hadden takes things a different direction by reading the eBook Trump and Compliance which was published in late 2016 and was based on the Everything Compliance gang’s predictions of how compliance would fare under the Trump Administration. Hadden shouts out to a new section of CCI which will focus on those persons early in their compliance careers. It is certainly a welcome addition to the compliance discussion.
  4.  Matt Kelly provides breaking news by discussing the SEC proposed changes to its Whistleblower Program. Kelly shouts out to Boston Celtic Enes Kantor for calling out the NBA on its hypocrisy on China.
  5. Jonathan Armstrong discusses the growing tide of US-style class actions coming to the UK and EU around the issue of data breaches under GDPR. Armstrong provides a public service announcement around the perils of using Apple Pay and the failure to Document Document Document.
  6. Tom Fox rants about the surreal news conference given by Acting Chief of Staff Mick Mulvaney where he (1) admitted the President violated US law in requiring a quid pro quo from Ukraine for the Congressionally mandated US aid package, claiming it was ‘just politics’ and (2) admitted the President violated the Emoluments Clause of the US Constitution by announcing the President had ordered the 2020 G-7 Summit to be held at Trump properties.

Resources:
From Jonathan Armstrong, on the always great Cordery Compliance site:
UK Data Protection Regulator Announces Intention to Fine BA after Data Breach
Life with GDPR – Episode 22 – Morrisons And Vicarious Liability
Client Alert: Doors open for data protection class action as appeal court allows Google claim to proceed?
 From Matt Kelly, the coolest guy in Compliance, on Radical Compliance:
SEC Tees up Whistleblower Reforms
 From Mike Volkov’s remarks, two articles from Compliance Week (sub req’d)
Point: Why CCOs should report to GC by Jeff Kaplan
Counterpoint: CCO, GC independence is critical by Matt Stankiewicz
From Sarah Hadden, the eBook published by CCI:
Trump and Compliance-the Conversation is Just Getting Started
The members of the Everything Compliance are:

  • Jay Rosen– Jay is Vice President, Business Development Corporate Monitoring at Affiliated Monitors. Rosen can be reached at JRosen@affiliatedmonitors.com
  • Mike Volkov – One of the top FCPA commentators and practitioners around and the Chief Executive Officer of The Volkov Law Group, LLC. Volkov can be reached at mvolkov@volkovlawgroup.com.
  • Matt Kelly – Founder and CEO of Radical Compliance. Kelly can be reached at mkelly@radicalcompliance.com
  • Jonathan Armstrong –is our UK colleague, who is an experienced data privacy/data protection lawyer with Cordery in London. Armstrong can be reached at armstrong@corderycompliance.com
  • Sarah Hadden –Publisher at Corporate Compliance Insights. Hadden can be reached at Sarah@corporatecomplianceinsights.com

The host and producer (and sometime panelist) of Everything Compliance is Tom Fox the Compliance Evangelist. Everything Compliance is a part of the Compliance Podcast Network.

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Daily Compliance News

October 24, 2019- the Need a Car Wash edition

In today’s edition of Daily Compliance News:

  • House passes bill to unmask shell companies in US. (com.sg)
  • Astros continue to trip over zero tolerance. (WSJ)
  • CFTC commissions will not have to testify. (WSJ)
  • Swiss prosecutors file first Car Wash charges. (Reuters)
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Daily Compliance News

October 23, 2019- the Corruption Continues edition

In today’s edition of Daily Compliance News:

  • Fresenius under investigation in Germany for bribery and corruption. (com)
  • South Africa corruption scandal ensnares Deloitte. (BBC)
  • German engineering firm sued over Brazilian dam collapse. (ABC News)
  • Two Brits charged in Nigeria for corruption over failed energy deal. (Reuters)
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Compliance Into the Weeds

Proposed SEC Whistleblower Reform

Compliance into the Weeds is the only weekly podcast which takes a deep dive into a compliance related topic, literally going into the weeds to more fully explore a subject. In this episode, Matt Kelly and I go into the weeds to explore the SEC’s proposed changes to its whistleblower program.
Some of the highlights include:

  • The reforms were originally announced 18 moths ago. Why is the SEC just now getting to public discussion?
  • What if anything will be the cap on high end awards?
  • Conversely, will the expansion of low-end awards beget better whistleblower tips?
  • Why would the SEC want to reduce award levels at the high end? What is the constituency for this position?
  • Why (or why not) should a whistleblower tip be in writing?
  • Why was the SEC Open Meeting to discuss these reforms postponed until November?
  • Will the meeting be postponed again? Who benefits from a postponement?

For additional reading see the following:
Matt’s blog post, SEC Tees Up Whistleblower Reform, on Radical Compliance.

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Life with GDPR

Episode 35- What does Brexit Mean for GDPR?

In this episode Jonathan Armstrong and I consider the implications of GDPR enforcement going forward after Brexit. Recognizing the situation is incredibly fluid, there are nevertheless some areas of risk management that you can begin to prepare for in the event of a deal for an orderly Brexit, a no-deal Brexit or an extension of the deadline Some of the highlights in this episode include:

  1. What does Brexit mean for GDPR enforcement?
  2. How will the UK-ICO move forward after Brexit?
  3. What are the implications of a no-deal Brexit? What can a company do to prepare at this point?
  4. How will the Irish regulators react to Brexit?
  5. What will Brexit mean for internal investigations, both in the UK and EU?
  6. What happens if there is an extension?
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Innovation in Compliance

Content is King with Andrea Falcione and Tricia Cornell


Andrea Falcione and Tricia Cornell of Rethink Compliance, one of the most innovative companies in the compliance space, join Tom Fox in this week’s show. They discuss their compliance journeys, and how content is reshaping the world of compliance.

Their Compliance Journeys
Andrea is a lawyer by profession. In 2004 she transitioned into compliance; she joined Rethink Compliance about a year ago. Tricia comes from the marketing and advertising world. The founder of Rethink, Kirsten Liston, asked her to join the company two years ago to bring her expertise in creating pieces of content to persuade people to think differently about commercial products, into the compliance space.
Content is King
Tom asks the guests to explain what ‘Content is king’ means, and why it’s so important and innovative in compliance. Tricia explains that it means that people are curious: they want to read, listen, and view videos, so compliance experts have to make their content consumable and desirable, and through that get their brand message out there. Andrea says that legal and compliance professionals find this idea difficult because they are essentially risk averse. When they send a message, it’s more about mitigating risk than engaging their audience. However, many organizations are getting negative feedback from their content consumers, so there is a need to create content that is relevant and engaging. This is becoming more and more critical, as regulators are looking at the effectiveness of companies’ efforts. 
Building Trust with Content
Andrea and Tricia share a piece of content created by ReThink Compliance in response to the Me Too Movement, is helping to change perceptions. Compliance officers should think about using content in different ways to get people to trust the process and the people involved in it, Andrea says. 
A Holistic Approach to Content
Tricia advises that a holistic approach to content starts with reaching your audience where they are. What are their attitudes? What are they looking for from their work? If you start with where they are and understand what they need from you, you’ll reach them more effectively with your message. Always think about how you can make your message relevant to your people. This can help build trust too, Andrea adds. If you think about what your audience needs to hear from you, they will begin to trust you more. 
Revamping the Code of Conduct
Tom asks, how or why can a code of conduct revamp be a powerful tool for a compliance practitioner. Andrea responds that the code of conduct is the cornerstone of every compliance program. As such, it needs to be a document that employees actually use, one that is meaningful and resonates with them. It all comes back to thinking about what your audience needs, Tricia emphasizes. If you want the code of conduct to be a resource, then you must think about where and when your people will need it. What questions might they have? How can you answer those questions in a way that’s easy for them to find the information they’re looking for? She points out that you need to make sure that information is easy to find, and written in language that’s easy to understand, so that they can make the right decision in the moment.
Resources
RethinkComplianceCo.com
LinkedIn: Andrea Falcione | Tricia Cornell | Kirsten Liston