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Compliance Into the Weeds

Compliance into the Weeds: Episode 115-Regulatory Capture and Regulatory Approval at the FAA

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 (the coolest guy in compliance) and I take a deep dive into the circumstances around the FAA approval process regarding the Boeing 737 MAX in the context of the crash in Ethiopia.We consider regulatory capture and what it might mean for US leadership in the aviation industry worldwide.

Some of the highlights include:

  • What was the process by which the plane was approved by the FAA?
  • How did the Boeing CEO persuade President Trump to prevent the FAA from grounding the Boeing fleet during the investigation process?
  • Why did the Ethiopian government send the plane’s black box to France, rather than the US, for analysis?
  • How did the US lose the world’s leadership in aviation safety?
  • Where was Boeing’s compliance function during all of this?
  • What are the lessons for the compliance practitioner?

For additional reading, see articles discussed in this podcast:

  1. In the Seattle Times, Flawed analysis, failed oversight: How Boeing, FAA certified the suspect 737 MAX flight control system, by Dominick Gates
  2. In the Wall Street Journal, Prosecutors, Transportation Department Scrutinize Development of Boeing’s 737 MAXby Andrew Tangel, Andy Pasztor and Robert Wall
  3. In Slate.com, Where Did Boeing Go Wrong? by Jeff Wise.
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Daily Compliance News

Daily Compliance News: March 20, 2019-the Risky Business edition

MARCH 20, 2019 BY TOM FOX


In today’s edition of Daily Compliance News:

  • Cambridge Analytica cover up? (The Daily Beast)
  • SEC ‘stunned’ Musk violated court order. (Bloomberg)
  • Japanese Olympic Committee head resigns amid bribery scandal. (Fox Sports)
  • It’s risky business to loan money to Donald Trump. (New York Times)
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FCPA Compliance Report

MTS Foreign Corrupt Practices Act Enforcement Action: Part II-the Bribery Schemes

In a stunning resolution to one of the longest running bribery, corruption and money-laundering sagas on the international stage, the Department of Justice and Securities Exchange Commission both announced settlement of a Foreign Corrupt Practices Act (FCPA) enforcement action against the Russian telecom company, Mobile TeleSystems PJSC (MTS). This podcast continues a five-part series will examine the background facts of the case, provide a detailed review of the bribery schemes involved, the compliance failures of MTS and its actions during the investigation which contributed to the size of the penalty, the individual criminal prosecutions brought by the Department of Justice as a part of this action and the key lessons learned by the compliance practitioner. In this Part 2, I consider the bribery schemes used by MTS to pay the bribes and Karimova to receive the bribe payments.
The documents which are the subject of this series are:
  1. MTS Deferred Prosecution Agreement (DPA);
  2. MTS Criminal Information (MTS Information);
  3. SEC Cease and Desist Order (Order);
  4. Karimova and Akhmedov Indictment (Indictment);
  5. Kolorit Dizayn Ink LLC Plea Agreement (Plea Agreement); and
  6. Kolorit Dizayn Ink Information (Kolorit Information);
  7. DOJ Press Release and
  8. SEC Press Release.
For additional reading see the blog post, “MTS FCPA Settlement and Karimova Indictment: Part II – The Bribery Schemes“
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Innovation in Compliance

Nimble and Strategic Compliance with Patrick Conroy

On this episode of the Innovation in Compliance Podcast, we have Patrick Conroy, RegTech Leader and Managing Director at ACA Technology. What does ACA do, what technologies and solutions do they offer, and how can you leverage them to make your compliance programs more strategic, nimble, and proactive?

Professional background
Patrick shares how he got his start in financial services, to working at the largest global banks in the world, and honing his skills as a compliance practitioner and embracing technology. Through that lens, he started building compliance services and looking at different emerging technologies, as well as focusing on RegTech at the firm.
ACA products and services
ACA’s solutions are derived from subject matter expertise with tech enablement around it, to help firms develop and architect their overall compliance programs. They focus across a few different verticals: compliance risk, advisory consulting, managed services, education and training, and technology solutions. Patrick goes into detail about each of these verticals, outlining the specific programs, support, and services they offer for each of them.
ComplianceAlpha and Compliance ELF
Compliance Alpha is ACA’s centralized platform which helps firms mitigate their risks through the efficiencies of synergies, as well as scale the workflows while keeping everything harmonized and transparent at the organizational level.
Within the platform are the Compliance ELF, the code of ethics, personal trading, and employee compliance management modules. This moves the actual doing and operationalization of compliance to the front lines at the employee level, where they’re inputting and capturing the data that can later be used by compliance professionals, the board of directors, or senior management in more of an oversight role.
All in all, the ComplianceAlpha allows organizations to have the tools at their fingertips to hone in on what’s really important — like detecting fraudulent behavior and mitigating overall firm risks — so they can become a lot more nimble, strategic, and proactive.
Resources
Patrick Conroy | ACA Compliance Group| 6 Ways to Stay Ahead of Financial Regulators with RegTech
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Daily Compliance News

Daily Compliance News: March 19, 2019-the filling out my bracket edition

MARCH 19, 2019 BY TOM FOX


In today’s edition of Daily Compliance News:

Categories
FCPA Compliance Report

MTS Foreign Corrupt Practices Act Enforcement Action: Part I-Introduction


In a stunning resolution to one of the longest running bribery, corruption and money-laundering sagas on the international stage, the Department of Justice and Securities Exchange Commission both announced settlement of a Foreign Corrupt Practices Act (FCPA) enforcement action against the Russian telecom company, Mobile TeleSystems PJSC (MTS). The FCPA enforcement action came in at $850 million which makes it Number 3 in the Top 10 of all-time FCPA settlements. This podcast opens a multi-part series will examine the background facts of the case, provide a detailed review of the bribery schemes involved, the compliance failures of MTS and its actions during the investigation which contributed to the size of the penalty, the individual criminal prosecutions brought by the Department of Justice as a part of this action and the key lessons learned by the compliance practitioner. In this Part 1, I begin with a review of the background facts, the parties and players and the fine and penalty of the MTS Foreign Corrupt Practices Act enforcement action.
The enforcement action was the third involving the same individual from the same country. That individual was Gulnara Karimova, the daughter of the former President of Uzbekistan. If that name sounds familiar to compliance professionals it is because she was also involved in the receipt of bribes paid in two other Top 10 FCPA enforcement actions; VimpelCom (now VEON Ltd.) and Telia Company AB. Contemporaneously with FCPA enforcement action involving MTS, there was a criminal indictment filed against Karimova and Bekhzod Akhmedov, a former MTS executive based in Uzbekistan. Akhmedov was charged with violating the FCPA for paying bribes to or for the benefit of Karimova and Karimova was charged she with laundering the money received as bribes.
The documents which are the subject of this series are:

  1. MTS Deferred Prosecution Agreement (DPA);
  2. MTS Criminal Information (MTS Information);
  3. SEC Cease and Desist Order (Order);
  4. Karimova and Akhmedov Indictment (Indictment);
  5. Kolorit Dizayn Ink LLC Plea Agreement (Plea Agreement); and
  6. Kolorit Dizayn Ink Information (Kolorit Information);
  7. DOJ Press Release and
  8. SEC Press Release.

For additional reading see the blog post, “MTS FCPA Settlement and Karimova Indictment: Part I-Introduction“.

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FCPA Compliance Report

FCPA Compliance Report-Episode 422, Vera Cherepanova

In this episode I visit with Vera Cherepanova author of the book, “Compliance Program of an Organisation”. We visit about her recent article on the FCPA Blog and its implications. Some of the highlights from the podcast include:

  1. Cherepanova’s unique professional background.
  2. What led to her to pen the recent article in the FCPA Blog, “Who’s to blame? The bad apple or the barrel?”
  3. What are the differences in the ‘situation perspective’ and the ‘personality perspective’?
  4. How do group dynamics inform corporate decision making?
  5. How can a compliance program be designed to prevent nefarious group think which might lead to bribery and corruption?
  6. Why is the myth of the rogue employee just that, a myth?

Resources:
FCPA Blog post “Who’s to blame? The bad apple or the barrel?”
Studio Etica website
LinkedIn Profile

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Daily Compliance News

Daily Compliance News: March 16, 2019-the VW sued (yet again) edition

MARCH 16, 2019 BY TOM FOX


In today’s edition of Daily Compliance News:

Categories
Popcorn and Compliance

Popcorn and Compliance: Captain Marvel

In this podcast series, recovering screenwriter (and Mr. Monitor) Jay Rosen and myself will indulge in passion for the movies by looking at them through the lens of compliance. Jay is a contemporary movie fan and I am more of a classic movie maven so we present a well-rounded view of the movie fandom. If you want to indulge in your love for the movies with two guys who are passionate about Hollywood and get some ideas for your compliance program, this is the podcast series for you.For this week’s offering, today we look at the Marvel-universe hero, Captain Marvel.

Some of the highlights include:

  • What is the backstory for Nick Fury and Phil Coulson?
  • How and why did internet trolls tried to sabotage the film?
  • What was the response of Rotten Tomatoes?
  • How were Eggs used to great effect?
  • The special effects and battle scenes were great.
  • Who was honored in different scenes in the movie?
  • Jay gives the movie not only a full bucket of popcorn but as second bucket as well. Tom joins with an overflow bucket of popcorn.

The Compliance takeaways:

  1. Understand where you come from, know your business inside and out.
  2. Nick Fury recognized a new risk-do you have a trip system for new risks in your organization? Do you have a seat at that table?
  3. How and why did Nick Fury lose his eye? How do you assess known strategies for unknown risks?
  4. Get out of the corporate office and into the field to meet your employees.
  5. Take action, when needed to change the balance.
  6. As a CCO you may have to take a stand.
Categories
This Week in FCPA

This Week in FCPA-Episode 146 – Ides of March (formerly St. Patty’s Day) edition

On this Ides of March tAs the St. Patrick’s Day weekend is upon, and we are all Irish at least for a day, Tom and Jay are joined by our favorite Irishman (and the Coolest Guy in Compliance), Matt Kelly to take a look at some of this week’s top compliance and ethics stories which caught their collective eyes this week.

  1. Massive corruption scandal rocks college admissions across the country. Dana Goldstein and Jack Healy in the NYT. Douglas Belkin and Jennifer Levitz in the WSJ. Nick Anderson in the Washington Post.
  2. FARA, FARA, FARA. Katie Brenner in the NYT. Dan Packel in Law.com.
  3. Former KPMG national practice leader convicted in PCAOB scandal. Michael Rapaport reports in the Wall Street Journal.
  4. Will the US finally clamp down on shell companies? Matthew Stephenson is cautiously optimistic in the Global Anti-Corruption Blog. General David Petraeus and Sheldon Whitehouse explain why it’s a national security issue in an Op-Ed piece in the Washington Post.
  5. Head coaches behaving badly as LSU head basketball coach suspended indefinitely in NCAA recruiting scandal. Ross Dellenger reports in Sports Illustrated.
  6. DOJ quietly modifies Corporate FCPA Enforcement Policy. Clare Hudson and Adam Dobrik report in GIR. (sub req’d) DOJ policy of self-disclosure making headway. Mingqi Sun in the WSJ Risk and Compliance Journal.
  7. Did Oracle violate the FCPA? (Tech Central)
  8. 1MDB scandal back in the news as former Goldman Sachs banker Timothy Leissner and Roger Ng banned from banking industry for life. David Simpson reports in Law360. (sub req’d) Also-did Jho Low contribute to Trump campaign? Tom Wright and Bradley Hope in the Wall Street Journal.
  9. How can you engage a BOD on cyber risks? Deloitte’s Khalid Kark, Tonie Leatherberry and Debbie McCormack in the Harvard Law School Forum on Corporate Governance.
  10. Tom continues with fan fav podcast series this week, the Adventures in Compliance this week.Check out the following: Part 1-The Red Circle; Part 2-The Abbey Grange; Part 3– The Priory School; Part 4-The Six Napoleons; and Part 5-The Empty House. The podcast is available on multiple sites: the FCPA Compliance Report, iTunes, JDSupra, Panoply and YouTube. The Compliance Podcast Network is now also on Spotify. It is now on Corporate Compliance Insights.
  11. In a special guest segment, Matt Kelly reports on the highlights from Ethisphere’s Global Business Ethics Summit, which was held this past week in New York.
  12. Check out the latest edition of Popcorn and Compliance where Tom and Jay look at Captain Marvel. It posts Saturday, March 16 on the Compliance 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.