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From Last to First

From Last to First: The John Aceti Story – Episode 8: International Global Exchanges

What is the measure of a man? What is a life well lived? I have often thought about those questions, and with John Aceti’s help, I had the opportunity to explore them through John’s amazing life. Spry and vibrant at 93, I met john after he had published his 7th book at 92. As I got to know him and his life story, I wanted him to share his amazing and inspiring journey from Niagara Falls in the 1930s to his current life in the Hill Country of Texas. Overcoming a humiliating incident at age 8, John was the first in his family to go to college, served in the Air Force, became a teacher and the principal, and retired from his first career. In his second career, he and his wife traveled internationally and ended up in Kerrville, Texas, where John began another career as an author. Join me on this fascinating journey From Last to First with John Aceti.

Get ready to be inspired by the incredible journey of John Aceti on ‘From Last to First.’ Hosted by the enthusiastic and insightful Tom Fox, this podcast episode explores Aceti’s early struggles with learning disabilities and how he overcame them to become a top-achieving student. In one section, Aceti discusses his experience participating in an early-start exchange program in Sweden, where he had the opportunity to learn and share his experiences with Swedish students and teachers. Accompanied by his teacher and funded by the Rotary Club and PTA, Aceti and his team had an eye-opening experience, staying with Swedish families and attending classes.

The section ends with Aceti and Fox emphasizing the importance of international experiences for students. Tune in to this exciting episode to hear invaluable insights from John Aceti and Tom Fox!

Key Highlights:

·      Travel Travel Travel

·      Trip to Sweden

·      Trips to Argentina

·      The Importance of Global Exchange Programs

 Notable Quotes:

“But it was a spectacular experience, primarily because people opened up and were willing to share, talk, and accommodate us. And I thought that was just awesome, by the way.”

“And we can talk about this with our Swedish friends that we brought a Swedish person with us who has relatives here. Talk about connections. My god. It’s just wow.”

“But that was my thinking, international, international, international. And why shouldn’t we do that?”

 Resources

John Aceti’s author’s page on Amazon

Categories
Blog

Building a Stronger Culture of Compliance Through Targeted and Effective Training: Part 4-A Training Program for 3rd Parties

Welcome to a special 5 part blog post series on building a stronger culture of compliance through targeted and effective training, sponsored by Diligent. Over this series I will visit with Kunal Agrawal, Director of Customer Success at Diligent; Kevin McCoy, Customer Success Manager at Diligent; Jessica Czeczuga, a Principal Instructional Designer; Andrew Rincon, Global Accounts Management Advisor at Diligent; and David Greenberg, former CEO and Special Advisor at LRN and Director at International Seaways. Over this series, we will consider the importance of ongoing communications, the value of targeted training, training third-parties, and the role of the Board of Directors. In this Part 4, we discuss how to put together a training program for third parties with Andrew Rincon.

In today’s global business landscape, third-party compliance training are more crucial than ever. Ensuring that your organization’s distributors, vendors, and other third-party affiliates adhere to necessary regulations can minimize legal and financial risks, protect your company’s reputation, and foster a culture of ethical business practices. As compliance professionals responsible for training these third parties, it’s essential to stay informed about cutting-edge strategies and techniques for effective risk management. This blog will explore practical steps that can be implemented to improve your third-party compliance training and due diligence processes, allowing you to uphold your organization’s regulatory standards and contribute positively to the industry. Here are the steps to get Improved third-party compliance training and due diligence processes.:

1. Assess third-party risk during onboarding.

2. Utilize micro training videos for efficiency.

3. Customize training materials for specific regions.

Assess third-party risk during onboarding. Due Diligence on and assessing third-party risk is not a ‘one size fits all’ process. This critical step allows organizations to identify high-risk distributors, vendors, and other third parties that may pose potential threats to the business in terms of bribery, corruption, and other regulatory violations. By conducting a thorough risk assessment, organizations can effectively mitigate these risks and ensure that they are partnering with ethical and responsible businesses, ultimately fostering a strong culture of compliance throughout their sales or supply chain ecosystem. Moreover, such an approach is critical throughout the lifecycle of the relationship. Rincon emphasized the importance of proactive ongoing due diligence measures, such as automated screenings and monitoring, sending out attestations, and conducting regular training courses.

Effectively educating, resellers, agents distributors and other third-parties on compliance policies and expectations is critical and cannot be overstated. Providing proactive training not only helps in preventing compliance violations but also demonstrates to regulators your organization’s commitment to maintaining high ethical standards. This, in turn, can mitigate penalties in case of inadvertent violations and foster a trust-based relationship with regulatory authorities. By adopting these practices and leveraging technology to automate certain processes, organizations can ensure that they are partnering with ethical third parties, minimize their exposure to regulatory risks, and foster a strong culture of compliance across their entire network. By doing so, they not only protect their businesses from potential harm but also contribute to a more transparent and ethical global marketplace.

Utilize micro training videos for efficiency. In the field of compliance, training third parties remains a critical aspect of managing and mitigating risks associated with regulatory and legal frameworks such as the Foreign Corrupt Practices Act (FCPA). With the increasing need for efficient and effective compliance processes, it becomes essential for compliance professionals to employ innovative strategies to achieve their objectives while minimizing disruptions to business operations. By leveraging this method, companies can ensure that their distributers and internal client gatekeepers receive consistent and easily digestible information, enhancing their understanding of compliance policies and expectations.

Rincon said that by breaking down complex topics into easily understandable portions, micro training videos enable organizations to communicate the essential aspects of their compliance policies and expectations in a concise and engaging manner. Through the ability to cater to different audiences, these training resources contribute to a more comprehensive approach towards addressing third-party risk. The adoption of micro training videos as a tool for third-party compliance education serves an essential purpose for compliance professionals. By incorporating this method, companies can enhance their third-party risk management processes and ensure that their partners are aware of the applicable legal and regulatory frameworks. This leads to improved adherence to compliance policies, reduced likelihood of violations, and overall risk mitigation.

Customize training materials for specific regions. Effective third-party compliance training often involve the customization of training materials for specific regions. This ensures that the training is relevant, relatable, and impactful for third parties, taking into account regional differences, languages, and sensibilities. Customizing training materials also fosters a deeper and more nuanced understanding of the compliance policies and expectations towards each party, thereby mitigating the risks associated with inadequate understanding or implementation of compliance standards. Furthermore, cultural sensitivities and regional variations can be taken into account when designing training, ensuring a more engaging and effective learning experience for the target audience.

Rincon micro-training video shorts can be easily customized for different regions and translated into multiple languages. With such versatile tools, compliance professionals can promote clear and concise messaging to their third-party partners, thus reinforcing the importance of compliance policies and due diligence throughout the duration of the business relationship. Customizing compliance training materials for specific regions not only makes the training more effective, engaging and relevant but also supports robust risk management and streamlined third-party due diligence processes.

For compliance professionals dedicated to training third parties, the effectiveness of your compliance and due diligence processes plays a significant role in safeguarding your organization from potential risks. The steps discussed, including customizing training materials for specific regions, agents, reseller, distributors and other business parnters on compliance policies and using technology to track irregularities, can greatly enhance your efforts to ensure that your third parties meet and maintain compliance expectations. With diligent application of the guidance provided, you can foster a well-informed and compliant network of third parties, ultimately ensuring your organization’s ongoing success.

For more information go to http://diligent.com/compliancetraining.

Join us tomorrow where we review the role of the Board of Directors in a compliance regime.

Categories
Innovation in Compliance

Building a Stronger Culture of Compliance Through Targeted and Effective Training: Part 4 – A Training Program for 3rd Parties

Welcome to a special 5 part podcast series on building a stronger culture of compliance through targeted and effective training, sponsored by Diligent. Over this series, I will visit with Kunal Agrawal, Director of Customer Success at Diligent; Kevin McCoy, Customer Success Manager at Diligent; Jessica Czeczuga, Director, Compliance and Ethics at Diligent; Andrew Rincón, Client Director at Diligent; and David Greenberg, former CEO and Special Advisor at LRN and Director at International Seaways. Over this series, we will consider the importance of ongoing communications, the value of targeted training, training third parties, and the role of the Board of Directors. In this Part 4, we discuss how to put together a training program for third parties with Andrew Rincón.

Join Tom Fox in an exciting episode about building a stronger culture of compliance through targeted and effective training as he interviews Andrew Rincón. Discover how the compliance industry has evolved and how technology has significantly improved compliance programs. Find out how efficient compliance processes create goodwill for compliance professionals and make them true partners of the business with the help of technology and reliable due diligence partners. Andrew Rincón shares Diligent’s screening and monitoring options for third-party suppliers and the customized anti-bribery and anti-corruption training, available in multiple languages, also perfect for bite-sized, animated micro-learnings. Tune in to learn how to educate distributors and internal gatekeepers on compliance and useful resources for compliance professionals, only on a training program for 3rd parties.

Highlights Include:

  • The Role of Compliance with Distributors
  • Efficient Due Diligence for Distributors
  • Diligent’s Anti-Bribery and Sanctions Screening Solutions
  • Compliance Training & Internal Controls for Distributors
Notable Quotes

“And commission sales agents are certainly recognized as, if not the highest, a high risk, under the FCPA and other compliance regimes.”

“One area the thinking has evolved on, and it sounds like your career and my career, is that due diligence alone is insufficient.”

“So being as efficient as a process. And nowadays, everything moves at the speed of light.”

“But nowadays, with the amount of information that gets published every single day throughout the world, where there’s so much content out there.”

For more information, go to Diligent.com

Join us tomorrow as we conclude our series with a look at the role of the Board of Directors in a compliance program.

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Pawtastic Friends - The Paw Talk

Pawtastic Friends -The Paw Talk – Annie, Seaton & Chappo

Welcome to Pawtastic Friends-The Paw Talk. In this podcast, host Tom Fox will visit with Michael and Melissa Novelli, co-founders of Pawtastic Friends as well as those who work with them at Pawtastic Friends. Michael and Melissa are dedicated to helping shelter and rescue dogs in the Las Vegas area become more adaptable, through enrichment training and activities such as yoga and aquatics training, as well as obedience and agility. This podcast is sure to tug on your heartstrings, just listen to how sweet this one dog is! Tune in now to hear more from Michael and Melissa Novelli as they discuss their passion for helping pups in need. Get ready for an exciting episode of Pawtastic Friends – The Paw Talk!

Welcome to the latest episode of the “Pawtastic Friends-The Paw Talk” podcast. In this episode, Tom visits with Michael Novelli and Melissa Novelli, the passionate founders of Pawtastic Friends. The couple shares heartwarming success stories of finding forever homes for dogs, and how the right training sessions can change a dog’s personality for the better. The conversation starts with Annie, a beautiful pitbull who found her forever home with a trainer despite needing to be an only dog. They also discuss Seton, a Boston Terrier with a biting problem, who became a different dog after attending their training sessions. The episode emphasizes the importance of proper training to ensure dogs and owners are set up for success. They also talk about Chapo, a dog abandoned at a boarding facility for almost a year, who is looking for his forever home. Tom encourages listeners to adopt dogs from shelters instead of backyard breeding.

This episode of “Pawtastic Friends-The Paw Talk” is a must-listen for anyone who loves dogs and believes in providing them with a happy and healthy life. You’ll be moved by the stories of these amazing pups and inspired by Mike and Melissa’s dedication to finding them their perfect home. Don’t miss out on the opportunity to make a difference in the life of a dog in need. Tune in now!

Dogs Featured 

·      Annie

·      Seaton

·      Chappo

Quotes

“And after months of training, he just became this different dog. He didn’t need a muzzle anymore, and the muzzle came off probably within a couple sessions.”

“At Pawtastic Friends, once they get adopted, if the dog might need a session or 2 or maybe even more sessions just to get acclimated in the home and help the new owner we want to be able to provide that because at the end of the day, we want to set the dog up for success and not only the dog, but the owner so that they have this in harmony forever home.”

“We do want people to know adopters that that we’re a lifeline. If you need us, you reach out and we’ll find a way to help you. Once a fantastic friend’s dog, always a fantastic friend’s dog.”

“He was actually abandoned at the boarding facility. He’s been there now I mean, our rescue partner took him in but he was abandoned. He’s been at that boarding facility for almost a year.”

Resources

Pawtastic Friends

Categories
Great Women in Compliance

Great Women in Compliance – GWIC 2.0- Introducing Lisa’s New Co-Host Lloydette Bai-Marrow

Welcome to the Great Women in Compliance Podcast, hosted by Mary Shirley and Lisa Fine.

As part of the countdown to 200, Lisa and Mary have their last two episodes before the GWICies and the summer hiatus before GWIC 2.0.  Today, we get to announce our new co-host, Lloydette Bai-Marrow, who was featured in Episode 110.  She is the founding partner of Parametric Global Consulting ,a former prosecutor at the UK’s Serious Fraud Office, is a member of the Board of Spotlight on Corruption, a UK-based anti-corruption charity that tracks how the UK implements its anti-corruption laws and has a commitment to anti-corruption in Africa and particularly Sierra Leone.

She is also committed to sending the elevator back down and our community.  In the episode, she discusses how she decided to make time to add co-hosting this podcast to her full plate, and some of her ideas for GWIC 2.0.  Lloydette also talks about the impact that Mary has had in the E&C world, and how that inspired her to join Lisa on the journey.

We are very excited about this next phase for all of us, including Mary’s upcoming book and her ongoing column at Corporate Compliance Insights!

You can find the Great Women in Compliance Podcast on the Compliance Podcast Network where you can find several other resources and podcasts to keep you up to date in the Ethics and Compliance world. You can also find the GWIC podcast on Corporate Compliance Insights where you can learn more about the podcast, stream prior episodes and catch up on Mary’s monthly column “Living Your Best Compliance Life.”

Corporate Compliance Insights is a much-appreciated sponsor and supporter of GWIC, including affiliate organization CCI Press publishing the related book; “Sending the Elevator Back Down, What We’ve Learned from Great Women in Compliance” (CCI Press, 2020). If you enjoyed the book, the GWIC team would be very grateful if you would consider rating it on Goodreads and Amazon and leaving a short review.  Don’t forget to send the elevator back down by passing on your copy to someone who you think might enjoy reading it when you’re done, or if you can’t bear parting with your copy, consider it as a holiday or appreciation gift for someone in Compliance who deserves a treat.

If you enjoyed the book, the GWIC team would be very grateful if you would consider rating it on Goodreads and Amazon and leaving a short review.  Don’t forget to send the elevator back down by passing on your copy to someone who you think might enjoy reading it when you’re done, or if you can’t bear parting with your copy, consider it as a holiday or appreciation gift for someone in Compliance who deserves a treat.

You can subscribe to the Great Women in Compliance podcast on any podcast player by searching for it and we welcome new subscribers to our podcast.

Join the Great Women in Compliance community on LinkedIn here.

Categories
Blog

Building a Stronger Culture of Compliance Through Targeted and Effective Training: Part 3-Defining the Effectiveness of Compliance Training

Welcome to a special 5 part blog post series on building a stronger culture of compliance through targeted and effective training, sponsored by Diligent. Over this series I will visit with Kunal Agrawal, Director of Customer Success at Diligent; Kevin McCoy, Customer Success Manager at Diligent; Jessica Czeczuga, a Principal Instructional Designer; Andrew Rincon, Global Accounts Management Advisor at Diligent; and David Greenberg, former CEO and Special Advisor at LRN and Director at International Seaways. Over this series, we will consider the importance of ongoing communications, the value of targeted training, training third-parties, and the role of the Board of Directors. In this Part 3, we consider the always challenging topic of defining the effectiveness of training with Jessica Czeczuga.

The Department of Justice (DOJ) requirement for ‘effective’ training is one of the most challenging areas for compliance professionals. Fortunately, Jessica Czeczuga is a highly respected Principal Instructional Designer with a remarkable 25-year career in the learning and development field and as a seasoned content creator, Jessica has collaborated with numerous experts to create effective training programs that resonate with different learning styles. I was able to visit with her on some of the key steps to get Improved training effectiveness through micro-learning and metrics.:

1. Adopt micro-learning techniques for content delivery
2. Utilize interruptive training methods for behavior disruption
3. Tailor targeted training for at-risk employees

1. Adopt micro-learning techniques for content delivery. Adopting micro-learning techniques is an essential approach for effectively delivering content to learners, particularly in the realm of compliance training. Micro-learning encompasses the practice of focusing on quick, digestible, and repetitious bursts of learning that serve to reinforce essential concepts while being easily accessible to learners. This method deviates from traditional lecture-style training, power point induced traing and allows for an interruptive and integrative learning experience that caters to the needs of varying learners. Leveraging micro-learning as a tool for training purposes allows for a higher likelihood of information retention and eventual behavior modification, as it allows individuals to reflect on their own learning patterns and apply the concepts in a more seamless way.

Czeczuga believes that by utilizing metrics such as pre and post-test scores and survey feedback to determine the effectiveness of training and cater the approach accordingly, highlighting the importance of collaboration between the compliance and training departments in this process. The adoption of micro-learning for compliance training holds significant importance as it ensures that all employees have a comprehensive understanding of relevant concepts and principles. Given that this understanding forms the basis of an organization’s culture of compliance and ethics, it is crucial to ensure that the training methods employed are effective in communicating this information.

2. Utilize interruptive training methods for behavior disruption. One essential approach to keep in mind when implementing compliance training is the use of interruptive training methods for behavior disruption. Interruptive training takes the form of quick, simple, and repetitious bursts of learning that are easily accessible and cater to different styles of learning. This approach allows for content delivery that is geared towards disrupting employees’ routine and thought patterns to promote engagement, behavior change, and a deeper understanding of the material.

Czeczuga noted this approach can be especially beneficial for sending general compliance messages like anti-bribery or corruption communications to a broad audience. Additionally, she related that pre and post-tests can provide useful metrics to determine the effectiveness of the training, while surveys can offer additional insights into how well the content is resonating with employees. In this way, interruptive training methods not only serve to catch employees’ attention and disrupt thought patterns but also allow for a more objective assessment of training success.

3. Tailor targeted training for at-risk employees. In recent years, there has been a significant shift towards more targeted and efficient training methods, particularly for at-risk employees. As a result, targeted training for at-risk employees ensures that they receive the specialized instruction they need, while also making it more likely that they will retain the information and apply it in their daily work activities. Czeczuga explained that even though there may be a need for longer, more focused training for certain employees who are considered more at risk, micro-learning can still be a highly effective tool for delivering general messages, like those related to anti-bribery. The interruptive nature of micro-learning allows it to be delivered in various modes, catering to the needs of different types of learners.

Czeczuga also emphasized the usefulness of pre- and post-tests as a means of assessing training effectiveness, as well as the value of surveys in gauging learner feedback. The importance of tailoring targeted training for at-risk employees cannot be overstated, as the consequences of compliance failures can be both costly and damaging to an organization’s reputation. Ensuring that these employees have the necessary information and tools to act ethically and responsibly is crucial in promoting a culture of compliance and minimizing risk. Collaborative efforts between compliance and training departments are essential for developing and implementing training strategies that strike the right balance between targeted, in-depth instruction for at-risk employees, and more generalized training for the broader staff. Ultimately, a well-executed and carefully tailored training program will lead to improved effectiveness and a more robust compliance culture throughout the organization.

The importance of effective compliance and training programs cannot be overstated for professionals in this field. The steps outlined above provide a comprehensive approach to building and sustaining a robust training strategy that not only engages your employees but also drives positive behavioral changes. From embracing micro-learning techniques and interruptive training methods to fostering collaboration between departments and reinforcing the message consistently over time, these steps can ultimately transform your organization’s culture into one that values and prioritizes compliance. Seize this opportunity to elevate your training efforts, and witness the remarkable impact on your organization as a whole.

Join us tomorrow for a review of training for 3rd parties.

For more information go to http://diligent.com/compliancetraining.

Categories
Uncovering Hidden Risks

Ep 9 – Don’t Get Caught Unprepared: Three Steps to Manage the Risks of Multicloud

This month’s episode of Uncovering Hidden Risks discusses the risks of running a multicloud strategy and how customers can think about this as they accelerate their digital transformation.

Ashish Kumar, Principal PM Manager at Microsoft, joins Erica Toelle and guest host Daniel Hidalgo on this week’s episode of Uncovering Hidden Risks. Ashish has over 25 years of experience in Engineering, Consulting, and Technology sales, helping businesses build products, increase revenue and market share, enhance branding, and lower operational costs. Ashish discusses the intersection between security and compliance, why knowing your posture is essential, and how we can have a safer digital world. You can also check out Ashish’s book, “Managing Risks in digital transformation.”

In This Episode You Will Learn:

  • The risks involved when you operate a multi-cloud environment
  • The importance of having real-time view of your cloud configuration and associated threats

Some Questions We Ask:

  • What is multi-cloud, and why is it important?
  • Can you share some takeaways for listeners looking to implement a multi-cloud strategy?
  • What is the main difference between hybrid and multi-cloud?

Resources:

View Ashish Kumar on LinkedIn

View Daniel Hidalgo on LinkedIn

View Erica Toelle on LinkedIn

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Trekking Through Compliance

Trekking Through Compliance – Episode 20 – Court Martial

In this episode of Trekking Through Compliance, we consider the episode Court Martial which aired on February 2, 1967, Star Date 2947.3.

Story Synopsis

After sustaining severe damage in an ion storm, the Enterprise is forced to seek repairs at Starbase 11, where  Commodore Stone investigates the death of records officer Ben Finney, who died in the storm. Stone finds it was Kirk’s negligence that led to Finney’s death.  A trial ensues, and Kirk’s former flame Ariel Shaw is the prosecuting attorney, and Kirk seeks the services of attorney Samuel T. Cogley.

Spock discovers something amiss in the program bank of the Enterprise after he can beat the computer 5 times, even though its program should not be capable of losing. Recognizing the computer has been tampered with, they find Finney and  Kirk’s record is cleared, and Samuel Cogley takes on a new case: defending Finney.

Commentary

In this episode of ‘Trekking Through Compliance,’ host Tom Fox explores the compliance lessons learned from the ‘Star Trek’ original series episode ‘Court Martial.’ Featuring the trial of Captain Kirk for an alleged violation during an ion storm, the episode delves into themes of due process, conflicts of interest, evidence preservation, and the role of expert testimony in compliance investigations. Tom draws parallels between the show’s narrative and key compliance principles such as transparency, accountability, and whistleblower protections, providing insightful takeaways for compliance professionals.

  • The Incident at Starbase 11
  • Kirk’s Court Martial Begins
  • Spock’s Discovery and the Final Verdict
  • Compliance Lessons from Court Martial

Resources

Excruciatingly Detailed Plot Summary by Eric W. Weisstein

MissionLogPodcast.com

Memory Alpha

 

Categories
Innovation in Compliance

Building a Stronger Culture of Compliance Through Targeted and Effective Training: Part 3 – Defining the Effectiveness of Compliance Training

Welcome to a special 5 part podcast series on building a stronger culture of compliance through targeted and effective training, sponsored by Diligent. Over this series, I will visit with Kunal Agrawal, Director of Customer Success at Diligent; Kevin McCoy, Customer Success Manager at Diligent; Jessica Czeczuga, Director, Compliance and Ethics at Diligent; Andrew Rincón, Client Director at Diligent; and David Greenberg, former CEO and Special Advisor at LRN and Director at International Seaways. Over this series, we will consider the importance of ongoing communications, the value of targeted training, training third parties, and the role of the Board of Directors. In this Part 3, we consider the always challenging topic of defining training effectiveness with Jessica Czeczuga.

Join Tom Fox and Jessica Czeczuga from Diligent in this episode as they discuss how to make compliance training effective. Jessica shares insights from years of creating targeted training materials, emphasizing the shift from traditional classrooms to microlearning. She explains how microlearning enhances comprehension, adaptability, and retention in learners. Tom and Jessica also explore the role of testing and assessments in compliance training and showcase the power of surveys in shaping the culture of compliance within organizations. Take advantage of this informative episode that will transform how you think about compliance, train, and communicate.

Highlights Include:

  • Effective Microlearning for DOJ Training
  • Benefits of Microlearning for Corporate Training
  • The Evolution of Compliance Training Testing
  • Building a Culture of Compliance and Ethics
Notable Quotes:

“Microlearning is probably one of the most effective ways to convey content to your donors.”

“One of the things that I love about microlearning beyond all those other benefits is the ability to put together what we call a multimodal communication campaign.”

“Even with all the benefits of microlearning, there are certain situations where longer and more targeted or focused training may be necessary.”

“But I think if you have a training function and a compliance function, they should always be in communication.”

For more information, go to Diligent.com

Join us tomorrow when we review a strategy for training third parties.

Categories
31 Days to More Effective Compliance Programs

One Month to a More Effective Compliance Program with Boards – Board Failures

Next, consider a couple of landmark failures at the Board level around bribery and corruption.

VimpelCom Ltd. In 2015 (now Veon Ltd.), the DOJ alleged that Dutch telecom VimpelCom sought to enter the telecom market through the acquisition of a local player, Unitel, as an entrée into the Uzbekistan market. Unitel made clear to VimpelCom that to have access to, obtain, and retain business in the Uzbeki telecom space, VimpelCom would have to, according to the DPA, “regularly pay Foreign Officials millions of dollars” to Gulnara Karimova, the daughter of the then President of the country. VimpelCom also acquired another entity Butzel, that was at least partially owned by an Uzbeki government official, who hid their interest through a shell company, which was known to VimpelCom. VimpelCom did not articulate a legitimate business reason for the deal and paid $60 million for Buztel.

Ultimately, VimpelCom agreed to pay approximately $800 million in fines for these activities in 2016. 

BizJet. Another FCPA enforcement action involved the Tulsa-based company BizJet International Sales and Support Inc. (BizJet), which had four senior executives convicted for their participation in a bribery scheme. But this case also involved the Board of Directions. In the Criminal Information, it stated that in November 2005:

…at a Board of Directors meeting of the BizJet Board, Executive A, and Executive B discussed with the Board that the decision of where an aircraft is sent for maintenance work is generally made by the potential customer’s director of maintenance or chief pilot, that these individuals are demanding $30,000 to $40,000 in commissions, and that BizJet would pay referral fees in order to gain market share.

In both cases, this is where the rubber hits the road. If a company is willing to commit bribery and engage in corruption to secure business, no amount of doing compliance is going to help. If senior management is ready, willing, and able to lie, cheat and steal, the Board is the final backstop to prevent such conduct. Both the VimpelCom and BizJet Boards sorely failed in their compliance duties.  

Three key takeaways:

  1. Board liability will be severe based upon similar conduct going forward.
  2. Board members must critically challenge management on its conduct.
  3. The Board is the ultimate backstop against bribery and corruption.

For more information, check out The Compliance Handbook, 4th edition, available here.