In today’s edition of Daily Compliance News:
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Loki, Episodes 1-3
Tom Fox and Megan Dougherty are back to review the Disney series starring the Marvel Cinematic Universe character, Loki, in the new series, appropriately enough named Loki. In this special catch up episode, they take a look at episodes 1-3. Each episode will feature a review of the synopsis, Cookies and other cool stuff and then go through some of the questions they have from each episode. It will be a rollicking great time. Join us for all 10 episode. Spoiler Alert-if you have not seen the episode, Tom and Megan will be taking a deep dive into all of the storylines.
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Iran Update
The Kitchen reviews the DOJ’s recent seizure of websites utilized by Iranian SDNs; UK issues guidance on financial restrictions under its sanctions on Russia.
How to manage if a conflict of interest arises in your organization?
Scenario: It’s Friday, July 3, and the General Counsel is on holiday. At 4 PM, you get a call from someone who tells you he has a deal with the CEO to be put on the Board of Directors. He further says he’s held up his end of the agreement to loan the CEO $5MM for a Board seat. He says he has the email traffic and will file a suit unless he is named to the Board within three days. He says the GC has approved this deal and is on the email trail.
What can you do? You review the code of conduct and believe it’s a Conflict of Interest (COI). There are four new Board members. Did they have similar arrangements?
In this episode, Compliance Evangelist Thomas Fox and Kortney Nordrum, Regulatory Counsel & Chief Compliance Officer, Deluxe Corporation, thresh out what to do if you are in a similar scenario and assess the best approach and manage corruption within your organization.
Key takeaways in the episode:
✔️ Make your first call with outside counsel. If members of the BOD are suspect, you wouldn’t want to tip them off by calling the Audit Committee chair – especially if that individual may be part of the problem.
✔️ Push to have outside counsel perform the special investigation instead of the BOD. That way, the results are above reproach.
✔️ Board membership should be vetted by counsel, especially when it comes to COI.
✔️ Reiterate that disclosing a conflict of interest is required, but that doesn’t mean that the conflict will cause a problem. Conflicts have to be managed. Some of them will result in the Board, the CEO, executive leadership, or members of the workforce not being able to take the actions they want to take.
✔️ Use COI incidents as an opportunity to retrain, reeducate and build awareness with the rest of the workforce on conflicts of interest and the code of conduct.
✔️ Train people in person on conflicts of interest and use real-life examples. COIs can be much broader, and ensure you name those. It can be sending business to a relative, a wife, or a child on the payroll can be a wide variety of things.
✔️ When you’re appointing so much of the Board and looking for people to help run your company, full diligence is really important.
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Welcome to SURVIVE AND THRIVE, the newest addition to the Compliance Podcast Network. This is a podcast where we unpack compliance, crisis disasters and walk you through all the red flags which appear, and give you some lessons learned going forward. This show is hosted by Compliance Evangelist Thomas Fox and Kortney Nordrum, Regulatory Counsel & Chief Compliance Officer, Deluxe Corporation.
Do you have a podcast (or do you want to)? Join the only network dedicated to compliance, risk management, and business ethics, the Compliance Podcast Network. For more information, contact Tom Fox at tfox@tfoxlaw.com.
Brad Moore, the President and CEO of Global Cannabis Applications Corp, started his career in marketing, working at Kodak, where he got an exceptional education in how to sell. His company is creating innovative strategies and solutions in the cannabis space. Always someone to be on the cutting edge of technology. He and Tom are discussing blockchain technology, navigating an industry without nearly enough data, and helping end-users make the best possible decisions.
Push-Pull Education
Brand and brand awareness is how you “cross the chasm” between an idea and the market. In his current industry, there is a cultivator at one end and a consumer at another, but the data and understanding that should help regulatory bodies facilitate communication between the two aren’t available. This means there is a lot of work that has to be done in education. It’s using a push-pull strategy to provide the education required to do certain things or communicate certain things, and that’s the pull strategy – the education, and that is what is going to get the company over the chasm.
Unique Challenges
One of the challenges Brad faces in his company is the huge variances that can occur between plant to plant. It’s not like a formulation that goes into a pill or a vaccine, so the different regulatory bodies have had to make decisions about how to tax and regulate it. To make their products available, they have to abide by rules made by people who don’t have all of the data. Brad is using innovative technologies to try and change that. Advocacy for patients informs a lot of his work, particularly making sure that end users have all of the information that they need to make informed decisions.
The Importance of Branding.
He talked about the Brand “Citizen Green” and what it needed to do for the company and for the market. He makes the comparison to a parent company and its subsidiary brands. Ultimately it means one thing, however, which is better outcomes for medical cannabis patients – Citizen Green, that is what it means.
Process-Driven Approach
Tom asked Brad about the process-driven approach used at GCAC, and Brad describes the different stakeholders involved in the company and the industry as a whole, and how he spent a great deal of time learning from different countries and how they arrange different processes in the industry. This is how they started to identify areas for improvement and innovation. He is now using blockchain technology to help consumers learn about products – which also helps suppliers and retailers get the information they need to provide good service and better products. Thanks to Blockchain technology, there are now user experience data attached to every gram of product, which is critical because plants change.
Partnerships and Looking to the Future
Jeffrey Hayzlett, who Brad first worked with at Kodak has taken a role as chairman of the board at GCAC, and Brad explains how their partnership has evolved over time. This kind of good working relationship with experts is important during uncertain times. Brad goes on to talk about how the blockchain basis of the company has been valuable during the pandemic. He believes that the blockchain mechanism he is using to solve problems in the cannabis industry is going to be very broadly applicable to any business dealing with consumables, or that otherwise deal with a lot of variance in their products.
Resources
Brad Moore on LinkedIn
Cannappscorp.com // Info@Cannappscopr.com
CitizenGreen.io
In today’s edition of Daily Compliance News:
- Can voluntary cooperation with DOJ lead to US jurisdiction? (Economic Times)
- Facebook anti-trust case dismissed. (WSJ)
- Juul settles first of several lawsuits for ads targeting minors. (NYT)
- Corrupt Angolan purchase on way to dissolution. (ICIJ)
This is a fun #jammingwithjason #podcast episode because I not only get to talk about music (which I love), but I also get to connect with a childhood friend who is an award winning musician, Joseph L. Young.
From just listening to music you enjoy, to playing an instrument, music can provide many psychological benefits such as reducing stress or getting into your “flow” state.
Music provides many outlets that can enrich one’s life. Listen in to learn more about the many positive effects that music can bring to you!
Whatever you do, check out Joseph’s music on Apple, Pandora, Spotify, pretty much anywhere you can listen to music and his website: https://josephlyoung.com/ When you do, you will see the power music can have on your emotions, mindfulness, and help you transform you life.
Listen in at: http://www.jasonmefford.com/jammingwithjason/
Betting on Bitcoin: Cryptocurrency & Digital Assets 101 for Investment Managers
In this episode, CSS’s Director of Broker-Dealer Services and Private Funds John Gentile sits down with Chief Executive Officer & Chief Investment Officer of Off the Chain Capital, Brian Estes to discuss the world of cryptocurrency and Bitcoin. Is this investing or gambling, is it an asset class, and why should investment advisers and broker-dealers be thinking about adding digital assets to their clients’ portfolios?
About Our Guest Speakers:
John Gentile is responsible for overseeing various types of broker-dealer and investment adviser consulting engagements, including conducting SEC/FINRA internal control reviews, anti-money laundering testing, written supervisory policy and procedures testing, and other consultation services. John is a frequent speaker at industry conferences on various compliance topics, including “Effective Supervision,” “Large Firm Testing,” FINRA Supervisory Control Rules” and “Anti Money Laundering Requirements for Broker Dealers under the PATRIOT Act.” In 1987 John joined the SEC as a Securities Compliance Examiner, becoming a Branch Chief in 1991. He became Assistant Regional Director in 1993, supervising a team of 20 broker-dealer managers and examiners. He also planned and conducted financial, operational, and sales practice examinations of the largest broker dealers and was among those responsible for a review of hedge funds’ impact on broker dealer internal controls. Before joining the SEC, John was a Financial Damage Analyst with PaineWebber Inc. Most recently from 2000-2007 John was an Executive Consultant, Broker-Dealer Services, at National Regulatory Services. John has an MBA from Fordham University and a BS in Finance from Central Connecticut State University. From 1995 to 2002, John was also a member of the Securities Industry Continuing Education East Coast Content Committee.
Brian Estes is the CEO and CIO of Off the Chain Capital which manages the #1 performing blockchain investment fund over the past 4 years. Brian has been a VC in blockchain for over 7 years and has advised, mentored and/or financed 5 blockchain companies that have a combined value of over $100B today. Prior to his immersion in blockchain, the Brian was one of the top-ranked investment managers in the nation. Morningstar ranked his client’s performance between 2004-2014 in the top 1/10th of 1% of the Morningstar equity manager universe. Brian earned his BA in Economics from the University of Illinois, his MBA with high honors from Washington University, and has studied at Cambridge University and the London School of Economics. For fun, Brian earned his pilot’s license in 1989 and has logged over 2200 hours of flight time in his Cessna 177RG.
The European Commission served up new and improved model contractual clauses for data transfers under the GDPR. Important dates are attached and the Kitchen took a look at this development.
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Episode 068 – Terry Stringer
In this episode of The Ethics Experts, Nick welcomes Terry Stringer, head of ethics and compliance office & center of excellence at HP, to the show.