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FCPA Compliance Report

James Koukios on the MoFo Top 10 International Anti-Corruption Developments for February 2020


In the Episode, I visit with James Koukios, partner at Morrison & Foerster, Editor-in-Chief of the firm’s Top 10 International Anti-Corruption Developments. We visit about the firm’s Top 10 International Anti-Corruption Developments for February 2020. Some of the highlights include:

  1. Lambert Motion for Acquittal Denied. We take a deep dive into the motion and the court’s ruling.
  2. Pemex Investigation Expands. What does it mean for US companies?
  3. Is each email a separate FCPA violation? What does this mean for the DOJ going forward?
  4. Cardinal Health FCPA resolution. Key takeaways for the compliance professional.

 Resources
To a copy of the Top 10 International Anti-Corruption Developments for February 2020 Newsletter click here.

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31 Days to More Effective Compliance Programs

One Month to a More Effective Compliance Program for 3rd Parties-3rd Party Compliance Terms and Conditions

The 2020 Resource Guide stated, “In addition to considering a company’s due diligence on third parties, DOJ and SEC also assess whether the company has informed third parties of the company’s compliance program and commitment to ethical and lawful business practices and, where appropriate, whether it has sought assurances from third parties, through certifications and otherwise, of reciprocal commitments. These can be meaningful ways to mitigate third-party risk.”

You should incorporate appropriate compliance terms and conditions into in every contract with third-parties. I would suggest that you prepare a template, which can be used as a starting point for your negotiations. The advantages of such a template are several and they include: (1) the contract language is tested against real events; (2) the contract language assists the company in managing its compliance risks; (3) the contract language fits into a series of related contracts; (4) the contract language is straight-forward to administer; and (5) the contract language helps to manage the expectations of both contracting parties regarding anti-bribery and anti-corruption.

Many do not believe that they will be able to get the third-party to agree to such compliance terms and conditions. I have found that while it may not be easy, it is relatively simple to get a third-party to agree to these or similar terms and conditions. One approach to take is that they are not negotiable. When faced with such a position on non-commercial terms many third-parties will not fight such a position. There is some flexibility, but the DOJ will require the minimum compliance terms and conditions. But the best position I have found is that if a third-party agrees with these terms and conditions, they can then use that as a market differentiator.

Three key takeaways:

  1. Compliance terms and conditions are mandatory for any best practices compliance program.
  2. A key clause is the right to audit clause.
  3. Third-parties can favor robust compliance terms and conditions as a market differentiator.
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Sunday Book Review

April 12, 2020, the William Burroughs edition


In today’s edition of Sunday Book Review:

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Compliance and Coronavirus

Mary Shirley and Lisa Fine on their professional and personal challenges during the Coronavirus Crisis


Welcome to the newest addition to the Compliance Podcast Network, Compliance and Coronavirus. As the Voice of Compliance, I wanted to start a podcast which will help to bring both clarity and sanity to the compliance practitioner and compliance profession during this worldwide health and healthcare crisis. In this episode, I am joined by the co-hosts of the Great Women in Compliance Podcast, Mary Shirley and Lisa Fine who discuss their personal and professional challenges during this time of coronavirus. The podcast is cross-posted from the Great Women in Compliance podcast, on the Compliance Podcast Network.
This podcast is sponsored by SAI Global. To learn how you can protect your business operations and workforce during these uncertain times, visit saiglobal.com/risk for free resources, expert guidance, and industry-leading technology.

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Daily Compliance News

April 11, 2020-the Lost Vision edition


In today’s edition of Daily Compliance News:

  • Employees trust their companies around COVID-19. (Houston Chronicle)
  • Banks slowing down business stimulus package? (WSJ)
  • Has Softbank lost its vision? (Barron’s)
  • At least Trump hasn’t blamed cell phone towers (yet). (Washington Post)
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31 Days to More Effective Compliance Programs

One Month to a More Effective Compliance Program for 3rd Parties-Evaluation of Due Diligence With Candice Tal

An important part of the job duties of any compliance practitioner is clearing red flags which might appear for a proposed third-party relationship during the due diligence process. It is mandatory that not only must all red flags be cleared but there also be evidence of the decision-making process to show to a regulator if one comes knocking. Around third-parties, consider what risks you face in both your sales and supply chain. If there is a key player several tiers down the line who creates or builds a key component or delivers a critical service, you may want to put more management around that relationship from the compliance perspective.

For anything below a tier 2; you may be able to manage your risks through having your direct tier one counter-party take the lead in managing such compliance risks. But make sure that the expectation is communicated to your direct counter-party so that if the government comes knocking you can show that not only did you contractually obligate your direct counter-party to do so but that you provided them the tools and training to do so. Finally, you will need to be able to show that your direct counter-party did so.

Three key takeaways:

  1. There is no set formula for clearing of red flags or the evaluation of due diligence.
  2. Know when to say enough has been done.
  3. You must “Document, Document, and Document” your evaluation of any red flags.
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Why a Duck

COVID-19 and Compliance: Part 5-Leadership and Final Thoughts


In this five-part series, Mike Volkov and Tom Fox consider COVID-19 from a variety of angles and perspectives; from the Board of Directors, the CCO, the ethical company, new laws and regulations, crisis management and leadership. In this fifth and final episode, we consider the paucity of leadership at the federal level and why this has put businesses at the forefront of leadership during this crisis. Highlights from the podcast include:

  1.  Why do we need strong federal leadership?
  2. Without federal leadership why is business leadership so important?
  3. Will CEOs who signed the Business Roundtable’s Statement on the Purpose of an Organization adhere to those principals in this time of crisis?
  4. What time horizons are you considering?
  5. Why is trust even more important now?
  6. How will the COVID-19 crisis test the mettle of companies in ways never seen in our lifetimes?

Resources
Mike Volkov
Call for Leadership
Absence of Federal Leadership 
Tom Fox
Trust in the Age of Coronavirus 
Final Thoughts
Mike Cherkasky on Testing Your Mettle

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31 Days to More Effective Compliance Programs

Supply Chain audits


In my last corporate position, my company was at the compliance forefront because we required compliance related audits for vendors in the supply chain. This was cutting edge in 2007-08. However, now an audit for adherence to compliance requirements has become a standard best practice in the management of business relationships with third-party vendors in the supply chain. In several settlements of enforcement actions through both DPAs and NPAs, in the 2012 FCPA Guidance and, most recently, in the 2019 Guidance, the DOJ made it clear that a best practices compliance program includes the right to conduct audits of the books and records of its suppliers to ensure compliance. Many companies have yet to begin their audit process for FCPA compliance on vendors in their supply chain. This is a missed opportunity from both the compliance perspective and greater business efficiency.
Any organization which audits a business partner in its supply chain should consult with legal, audit, financial and supply chain professionals to determine the full scope of the audit and a thorough and complete work plan should be created based upon all these professional inputs. After an audit, an audit report should be issued. This audit report should detail incidents of non-compliance with the compliance program and recommendations for improvements. Any reported incidents of non-compliance should reference the basis, such as contractual clauses, legal requirement or company policies.
 Three key takeaways:

  1. Is your supply chain vendor committed to the audit process?
  2. Capture the data, analyze the data, report on the data.
  3. Supply chain audits are no longer cutting edge but are now simply best practices.
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Daily Compliance News

April 10, 2020-the All FT edition


In today’s edition of Daily Compliance News:

  • How do you define productivity in a pandemic? (FT)
  • Supply chains need love too. (FT)
  • HSBC reports potential AML breaches (again). (FT)
  • Travis Kalanick and the ‘Ghost Kitchen’. (FT)
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Trekking Through Compliance

Picard- Episode 9, Et in Arcadia Ego


Welcome to a special series of Trekking Through Compliance, the podcast series inspired by my review of Star Trek, the Original Series. In this special series I am joined by another uber Star Trek maven, Megan Dougherty, co-founder of One Stone Creative. In this series we will review the new television show Picardwhich is currently streaming on CBS. Today, Episode 9, “Et in Arcadia Ego”.
SPOILER ALERT-Although we will review each episode after it appears, we will discuss each episode in depth.
Episode 9, Et in Arcadia Ego. Picard’s brain condition has become terminal.  He is on his mission to find and save androids he believes to be Soji’s people.  The Romulans have now found the Synth homeworld.  Picard and friends arrived at this synth home world and meet Dr. Altan Inigo Soong, a previously unknown organic son of Noonian Soon; and a number of synths.  Picard attempts to contact Starfleet, reporting a first contact with the synths.  But a synth, Sutra  mind-melded with Agnes Jurati and was able to explain the real meaning of the Admonition which the Zhat Vash.  Sutra designed a beacon to summon the advanced synthetic life to save her people and destroy all organics.  Dr. Soong and Jurati took the side of the synths and Picard is led away under house arrest to end this Part 1 of a two-part conclusion.
Highlights, speculations and questions include:

  1. Homage to the Picard Incident?
  2. Some really big philosophical questions in this episode.
  3. What is the role of Dr. Soong?
  4. Sutra and Vulcan mind-meld?
  5. Will the evolution of the synths lead to the annihilations of organics?
  6. Moment between Raffi and Picard. Was it real for you?
  7. Sutra and her manipulation?
  8. Does Picard have any credibility regarding his offer to protect the synths?
  9. Cookies