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Everything Compliance

Everything Compliance-Episode 10, first 100 day of the Trump Administration

This episode is dedicated to the chaotic (at best) first 100 days of the Trump administration related to compliance.

  1. Jonathan Armstrong leads a discussion of the Trump administration’s devolution of Privacy Shield, GDPR, and what they mean for American companies doing business in the UK and EU. He discusses the key differences in the DOJ’s Evaluation of Corporate Compliance Programs in an FCPA analysis and under the Bribery Act, differences in the EU approach to conflict minerals, and under the Trump Administration, and concludes by giving us his thoughts on what Brexit means for compliance.

For the Cordery Compliance client alerts, see the following:
EU conflicts minerals compliance legislation 
DOJ Evaluation of Corporate Compliance: how does it compare to UK Bribery Act 2010?
BREXIT Glossary

  1. Jay Rosen considers what companies the intersection of business and politics under the Trump administration, the business response he has observed to Trump administrations steps and miss-steps, the comments made by DOJ representatives at Q1 conferences, and the vibe of compliance conference attendees.

For Jay’s posts, see,
 Still in the Enforcement Business and Evaluation of Corporate Compliance Programs
“It Was the Best of Times, It was the Worst of Times,” or “Ignorance is Strength”
 Matt Kelly opens with a discussion of regulatory enforcement under the Trump administration, how the ‘Trump Effect’ is negatively impacting corporations, and industry responses to deregulation issues and lays down some markers around compliance issues under the new administration.
For Matt Kelly’s posts, see:
Compliance in the Trump Era: More Markers Placed
Trump Administration Whacks Telco Firm for $892 Million
Drone Industry Pan Trump’s Regulatory
Trump Risk Disclosures Start Rolling In
First SEC Whistleblower Award of the Trump Era
Sessions Dodges, Weaves, Promises on FCPA

  1. Mike Volkov rounds out the discussion with a review of where the DOJ is currently under AG Sessions, remarks by DOJ officials on FCPA enforcement, the future of the Pilot Program, and DOJ Compliance Counsel Hui Chen.

For Mike Volkov’s posts, see the following:
Yates, AG Sessions and Individual Criminal Prosecutions
New E-Book — Moving the Goalposts: The Justice Department Redefines Effective Compliance
FCPA Remediation Focus on Supervisory Personnel
FPCA Pilot Program Motors On
For Tom Fox’s posts on the Trump administration’s first 100 days, see the following:
The Trump Administration-Kaos is Bad for Business
The Trump Administration-Failures in Leadership and Management
The Trump Administration-Preparing for a Catastrophe
The Trump Administration-the Business Response
DOJ Enforcement of the FCPA and the International Fight against Corruption in the Trump Administration
The members of the Everything Compliance panel include:

  • 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, is the former Editor of Compliance Week. Kelly can be reached at mkelly@radicalcompliance.com
  • Jonathan Armstrong – Rounding out the panel is our UK colleague, who is an experienced lawyer with Cordery in London. Armstrong can be reached at armstrong@corderycompliance.com

[tweet_box design=”default” url=”http://wp.me/p6DnMo-3eF” float=”none”]What has the Trump effect meant for FCPA? The experts weigh in.[/tweet_box]]]>

Categories
Everything Compliance

Everything Compliance – Episode 10, first 100 days of the Trump Administration

  • Jonathan Armstrong discusses the Trump administration’s devolution of Privacy Shield, GDPR, and what they mean for American companies doing business in the UK and EU. He discusses the key differences in the DOJ’s Evaluation of Corporate Compliance Programs in an FCPA analysis, under the Bribery Act, in the EU approach to conflict minerals, and under the Trump Administration. He concludes by giving us his thoughts on what Brexit means for compliance.

For the Cordery Compliance client, alerts see the following: EU conflicts minerals compliance legislation  DOJ Evaluation of Corporate Compliance: how does it compare to UK Bribery Act 2010? BREXIT Glossary

  1. Jay Rosen considers what companies the intersection of business and politics under the Trump administration, the business response he has observed to Trump administrations steps and miss-steps, the comments made by DOJ representatives at Q1 conferences, and the vibe of compliance conference attendees.

For Jay’s posts, see,  Still, in the Enforcement Business and Evaluation of Corporate Compliance Programs “It Was the Best of Times, It was the Worst of Times,” or “Ignorance is StrengthMatt Kelly opens with a discussion of regulatory enforcement; under the Trump administration, how the ‘Trump Effect’ is negatively impacting corporations, industry responses to deregulation issues and lays down some markers around compliance issues under the new administration. For Matt Kelly’s posts, see Compliance in the Trump Era: More Markers Placed Trump Administration Whacks Telco Firm for $892 Million Drone Industry Pan Trump’s Regulatory Trump Risk Disclosures Start Rolling In First SEC Whistleblower Award of Trump Era Sessions Dodges, Weaves, Promises on FCPA.

  1. Mike Volkov rounds out the discussion with a review of where the DOJ is currently under AG Sessions, remarks by DOJ officials on FCPA enforcement, the future of the Pilot Program, and DOJ Compliance Counsel Hui Chen.

For Mike Volkov’s posts, see the following: Yates, AG Sessions and Individual Criminal Prosecutions New E-Book — Moving the Goalposts: The Justice Department Redefines Effective Compliance FCPA Remediation Focus on Supervisory Personnel FPCA Pilot Program Motors On For Tom Fox’s posts on the Trump administration’s first 100 days see the following: The Trump Administration-Kaos is Bad for Business The Trump Administration-Failures in Leadership and Management The Trump Administration-Preparing for a Catastrophe The Trump Administration-the Business Response DOJ Enforcement of the FCPA and the International Fight against Corruption in the Trump Administration The members of the Everything Compliance panel include:

  • 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 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, is the former Editor of Compliance Week. Kelly can be reached at mkelly@radicalcompliance.com.
  • Jonathan Armstrong – Rounding out the panel is our UK colleague, an experienced lawyer with Cordery in London. Armstrong can be reached at armstrong@corderycompliance.com.
Categories
This Week in FCPA

This Week in FCPA-Episode 46, the On the Rode to Prague Edition

  • Why powerful people fail to stop bad behavior by their underlings. Click here for the article.
  • Some policy management lesson, courtesy United Airlines. Click here for Matt Kelly’s article on Radical Compliance.
  • Why you shouldn’t linger too long in the wrong compliance position. See Julie DiMauro’s blog post on the FCPA Blog.
  • Bribe recipient in the Gerald and Patricia Green FCPA case gets 50 years in prison. See article in the FCPA Blog.
  • Using data to operationalize your compliance program. Read Tom’s blog post, by clicking here.
  • What the New York state Department of Financial Services new regulation on cybersecurity for financial services companies means for compliance officers. See Tom’s blog post by clicking here.
  • Jay previews his weekend report.
  • Jay Rosen new contact information:
    Jay Rosen, CCEP
    Vice President, Business Development
    Monitoring Specialist
    Affiliated Monitors, Inc.
    Mobile (310) 729-6746
    Toll Free (866)-201-0903
    JRosen@affiliatedmonitors.com
    [tweet_box design=”default” url=”http://wp.me/p6DnMo-3aD” float=”none”]How can the use of data help to operationalize your compliance program?[/tweet_box]]]>

    Categories
    Compliance Into the Weeds

    Compliance into the Weeds-Episode 33, enhancing culture

    Great Speech About Improving Corporate Culture“.]]>

    Categories
    Compliance Into the Weeds

    Day 18 of One Month to Operationalizing Your Compliance Program-Through Management of Third Party Relationships

    Management of Relationships – How has the company considered and analyzed the third party’s incentive model against compliance risks? How has the company monitored the third parties in question? How has the company trained the relationship managers about what the compliance risks are and how to manage them? How has the company incentivized compliance and ethical behavior by third parties?
    If you do not manage the relationship it can all go downhill very quickly and you might find yourself with a potential FCPA violation. Now the DOJ has explicitly adopted this approach as a key determination of whether you have operationalized your compliance program. There are several different ways that you should manage your post-contract relationship.
    Relationship Manager
    There should be a Relationship Manager for every third party which the company does business with through the sales chain. The Relationship Manager should be a business unit employee who is responsible for monitoring, maintaining and continuously evaluating the relationship between your company and the third party. Some of the duties of the Relationship Manager may include:

    • Point of contact with the Third Party for all compliance issues;
    • Maintaining periodic contact with the Third Party;
    • Meeting annually with the Third Party to review its satisfaction of all company compliance obligations;
    • Submitting annual reports summarizing services provided by the Third Party;
    • Assisting the company’s compliance function with any issues with respect to the Third Party.

    The Relationship Manager can be the Business Sponsor who prepared the Business Rationale discussed on Day 17. By using the Business Sponsor as the Relationship Manager, your company will further operationalize compliance by continuing to have the business unit lead the front-line relationship, communications and contact with the third party. As noted compliance commentator Scott Moritz has said, “This puts the onus on each stakeholder.”
    Compliance Professional
    Just as a company needs a subject matter expert (SME) in anti-bribery compliance to be able to work with the business folks and answer the usual questions that come up in the day-to-day routine of doing business internationally, third parties also need such a resource. A third party may not be large enough to have its own compliance staff so any company using third party representatives should provide a dedicated resource to third parties. This will not create a conflict of interest nor are other legal impediments to providing such services. They can also include anti-corruption training for the third party, either through onsite or remote mechanisms. The compliance practitioner should work closely with the relationship manager to provide advice, training and communications to the third party.
    Third Party Oversight Committee
    A Third Party Oversight Committee further operationalizes compliance. It review all documents relating the full panoply of a third party’s relationship with a company. It can be a formal structure or some other type of group but the key is to have the senior management put a ‘second set of eyes’ on any third party who might represent a company on the sales side. In addition to the basic concept of process validation of your management of third parties, as third parties are recognized as the highest risk in anti-corruption compliance, this is a manner to deliver additional management of that risk.
    After the commercial relationship has begun the Third Party Oversight Committee should monitor the third party relationship on no less than an annual basis.  This annual audit should include a review of remedial due diligence investigations and evaluation of any new or supplement risk associated with any negative information discovered from a review of financial audit reports on the third party. The Third Party Oversight Committee should review any reports of any material breach of contract including any breach of the requirements of the Company Code of Ethics and Compliance.  In addition to the above remedial review, the Third Party Oversight Committee should review all payments requested by the third party to assure such payment are within the company guidelines and are warranted by the contractual relationship with the third party. Lastly, the Third Party Oversight Committee should review any request to provide the third party any type of non-monetary compensation.
    Audit
    A key tool in operationalizing the relationship with a third party post-contract is auditing the relationship. You should secured audit rights, as that is an important clause in any compliance terms and conditions. Your audit should be a systematic, independent and documented process for obtaining evidence and evaluating it objectively to determine the extent to which your compliance terms and conditions are followed. Noted fraud examiner expert Tracy Coenen described the process as one to (1) capture the data; (2) analyze the data; and (3) report on the data, which is also appropriate for a compliance audit. As a base line, any audit of a third party include, at a minimum, a review of the following:

    1. the effectiveness of existing compliance programs and codes of conduct;
    2. the origin and legitimacy of any funds paid to Company;
    3. books, records and accounts, or those of any of its subsidiaries, joint ventures or affiliates, related to work performed for, or services or equipment provided to, Company;
    4. all disbursements made for or on behalf of Company; and
    5. all funds received from Company in connection with work performed for, or services or equipment provided to, Company.

    If you want to engage in a deeper dive you might consider evaluation of some of the following areas:

    • Review of contracts with third parties to confirm that the appropriate FCPA compliance terms and conditions are in place.
    • Determine that actual due diligence took place on the third party.
    • Review FCPA compliance training program; both the substance of the program and attendance records.
    • Does the third party have a hotline or any other reporting mechanism for allegations of compliance violations? If so how are such reports maintained? Review any reports of compliance violations or issues that arose through anonymous reporting, hotline or any other reporting mechanism.
    • Does the third party have written employee discipline procedures? If so have any employees been disciplined for any compliance violations? If yes review all relevant files relating to any such violations to determine the process used and the outcome reached.
    • Review employee expense reports for employees in high-risk positions or high-risk countries.
    • Testing for gifts, travel and entertainment that were provided to, or for, foreign governmental officials.
    • Review the overall structure of the third party’s compliance program. If the company has a designated compliance officer to whom, and how, does that compliance officer report? How is the third party’s compliance program designed to identify risks and what has been the result of any so identified?
    • Review a sample of employee commission payments and determine if they follow the internal policy and procedure of the third party.
    • With regard to any petty cash activity in foreign locations, review a sample of activity and apply analytical procedures and testing. Analyze the general ledger for high-risk transactions and cash advances.

    Three Key Takeaways

    1. Management of the third party relationship is the key step in determining the effectiveness of your compliance program in this risk area.
    2. By using non-compliance functions, such as the Business Sponsor or Relationship Manager you more fully operationalize your compliance program.
    3. Never forget to put a second set of eyes on all third party relationships.

    This month’s podcast series is sponsored by Oversight Systems, Inc. Oversight’s automated transaction monitoring solution, Insights On Demand for FCPA, operationalizes your compliance program. For more information, go to OversightSystems.com.
    [tweet_box design=”default” url=”http://wp.me/p6DnMo-37H” float=”none”]Management of 3rd parties is where the rubber meets the road in operationalizing your compliance program.[/tweet_box]]]>

    Categories
    Everything Compliance

    Everything Compliance-Episode 7

  • Jonathan Armstrong leads a discussion of the Trump administrations devolution towards Privacy Shield and what it may portend for American companies doing business in the UK and EU. He highlights the recent opening of a new trial in Ireland brought by Max Schrems and also discussed the putative Muslim refugee ban in the context of broader business implications.
  • For the Cordery Compliance client alert on Privacy Shield, see here

    1. Jay Rosen considers what companies the intersection of business and politics under the Trump administration, the Tech sector response to the Muslim refugee ban and the more general business response to the first few weeks of the Trump administation.

    For Jay’s post see, Where Do Politics End and Ethics & Compliance Begin?

    1. Matt Kelly opens with a discussion of the management process practices of the Trump administration in issuing Executive Orders and lays down some markers around compliance and regulatory issues under the new administration.

    For Matt Kelly’s posts see the following:
    Compliance in the Trump Era: More Markers Placed
    Five Questions for SEC Nominee Jay Clayton
    Yes Government Ethics is Happening
    Dodd-Frank Reform Starts Coming into View
     For Tom Fox’s posts on these topics see the following:
    The Trump Administration-Kaos is Bad for Business
    The Trump Administration-Part II, Failures in Leadership and Management
    The Trump Administration-Part III-Preparing for a Catastrophe
    The Trump Administration-Part IV-the Business Response
    The members of the Everything Compliance panel include:

    • Jay Rosen (Mr. Translations) – Jay is Vice President of Legal & Corporate Language Solutions at United Language Group. Rosen can be reached at rosen@ulgroup.com.
    • Mike Volkov – One of the top FCPA commentators and practitioners around and is the Chief Executive Officer (CEO) and owner of The Volkov Law Group, LLC. Volkov can be reached at mvolkov@volkovlawgroup.com.
    • Matt Kelly – Founder and CEO of Radical Compliance, is the former Editor of the noted Compliance Week Kelly can be reached at mkelly@radicalcompliance.com
    • Jonathan Armstrong – Rounding out is our UK colleague, who is an experienced lawyer with Cordery in London. Armstrong can be reached at armstrong@corderycompliance.com

    [tweet_box design=”default” url=”http://wp.me/p6DnMo-336″ float=”none”]What compliance and business lessons arise from the first 3 weeks of the Trump administration?[/tweet_box]]]>

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    Everything Compliance

    This Week in FCPA-Episode 38, the M&M Edition

    Show Notes for Episode 38, for the week ending February 3, the M&M edition:

    1. January a month for the FCPA record books. See article in the FCPA Blog.
    2. Are hunting trips a FCPA violation? How about in Sweden? See article in by Tom Fox in Compliance Week.
    3. VW update-what the former CEO knew and when did he know it and CCO ‘departs’. What does it all mean? See Tom Fox articles in Compliance Week on the former CEO and the departure of the CCO.
    4. New Tom Fox series on One Month to a Better Board, FCPA Compliance Report.
    5. Everything Compliance-Episode 6 is out. It is dedicated exclusively to Rolls-Royce.
    6. Jay Rosen Weekend Report preview.
    7. Super Bowl predictions.

    [tweet_box design=”default” url=”http://wp.me/p6DnMo-31q” float=”none”]What were the week’s top FCPA, compliance and ethics stories? Check out This Week in FCPA to find out. [/tweet_box]]]>

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    This Week in FCPA

    This Week in FCPA-Episode 35

    th edition:

    1. Hernandez and Beech FCPA guilty pleas. Hernandez Criminal Information, Beech Criminal Information.
    2. VW guilty plea in emissions-testing scandal. Link to article in New York Times.
    3. VW executive Oliver Schmidt arrested in US. See article on FCPA Compliance and Ethics Blog.
    4. Zimmer Bio-Met in follow-up FCPA enforcement action. See article on FCPA Blog.
    5. Mondelez FCPA enforcement action. See SEC Cease and Desist Order and article on FCPA Compliance and Ethics Blog.
    6. Supreme Court to take up 5 year statute of limitations for profit disgorgement under Securities Act, which applies to FCPA enforcement actions brought by SEC. Article in Law360.
    7. NFL Playoff update on Patriots, Cowboys and Texans.

    [tweet_box design=”default” url=”http://wp.me/p6DnMo-2XB” float=”none”]What were the FCPA matters, issues and lessons from the week ending January 13, 2017? Check out This Week in FCPA.[/tweet_box]]]>

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    This Week in FCPA

    This Week in FCPA-Episode 34, the Invisible Hand Edition

    In this episode Jay Rosen and I take a dive into the General Cable FCPA enforcement action, consider the ‘Invisible Hand’ of  Justice Department Compliance Counsel Hui Chen and greater regulatory enforcement, corporate response and innovation. We explain how these three factors combine in an ‘Invisible Hand’ to form a continuous improvement loop of compliance program innovation. It leads developments from cutting edge to best practices to becoming a routine part of an effective compliance program. We discuss the upcoming NFL divisional round of playoffs and conclude with Jay previewing the Jay Rosen Weekend Report. For more information on the General Cable FCPA enforcement action, check out my three-part blog post series:
    Part I-the Bribery Schemes
    Part II-the Comeback
    Part III-the Denouement
    [tweet_box design=”default” url=”http://wp.me/p6DnMo-2W9″ float=”none”]How does the invisible hand impact continuous improvement of compliance programs?[/tweet_box]]]>

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    Everything Compliance This Week in FCPA

    This Week in FCPA-Episode 29, the Brave New World edition

  • Trumps stunning and surprising win and what does it mean for regulatory enforcement and FCPA –See article in the New York Times, Deal Book — How Trump’s Presidency Will Change the Justice Dept. and S.E.C.; for additional views on see Matt Kelly’s thoughts on his site, radicalcompliance.com “5 Post-Elections Points for CCOs to Ponder; for the nightmare scenario, see Matthew Stephenson’s blog post, “US Anticorruption Policy in a Trump Administration: A Cry of Despair from the Heart of Darkness” and finally Jack Kelly’s perspective from the compliance arena in the financial services sector (Dodd-Frank), “It is Not Looking too Good for Compliance Officers in the New Trump Administration”. The next Everything Compliance podcast will be devoted to this top;
  • New French Anti-Corruption Law (Saipan II) – click here for Miller & Chevalier newsletter on this new law. http://www.millerchevalier.com/Publications/MillerChevalierPublications?find=183702
  • The VW emissions-testing scandal investigation expands. As reported in the FCPA Blog, German prosecutors name VW chairman in expanded probe;
  • 1st edition of Everything Compliance Podcast, the new podcast in the FCPA Compliance and Ethics Report podcasting network;
  • Scott Moritz continues his two-part series on compliance and M&A, focusing on post-acquisition. Click here for the FCPA Blog posting, A plan to integrate the compliance program after an acquisition;
  • Rio Tinto announces it has suspended a senior executive for payment to a consultant to assist the company obtain a mining concession in Guinea that it had previously lost. See blog post on the FCPA Compliance and Ethics Report;
  • Joe Warin and Julie Rapoport Schenker discuss the intersection of corporations, white collar defense and trials in their law review article on why companies refuse to settle and instead go to trial. To read click here; and
  • The Jay Rosen Weekend Report.
  • [tweet_box design=”default” url=”http://wp.me/p6DnMo-2QP” float=”none”]What are the week’s top FCPA, compliance and ethics stories?[/tweet_box]]]>