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Daily Compliance News

Daily Compliance News: September 10, 2026, The Toe-Treading Trial Edition

Welcome to the Daily Compliance News. Each day, Tom Fox, the Voice of Compliance, brings you compliance-related stories to start your day. Sit back, enjoy a cup of morning coffee, and listen in to the Daily Compliance News. All from the Compliance Podcast Network. Each day, we consider four stories from the business world, compliance, ethics, risk management, leadership, or general interest for the compliance professional.

Top stories include:

  • Judge’s COI nixes award. (Reuters)
  • Ex-head of Swiss banking association convicted of corruption. (SwissInfo)
  • Iranian airlines are still flying. (WSJ)
  • AI causing toe-treading at work. (FT)

My first work of general non-fiction is now out: Deluge Before Dawn, the story of the 2025 flood in Kerr County, Texas, which killed 119 people and devastated a county. It is a story of tragedy, heartbreak, survival, and resilience.

It is available on the following sites:

Amazon.com

Stoney Creek Publishing

Barnes and Noble

Texas A&M University Press

Bookshop.org

Google.Books

Walmart

This week only, the Kindle e-book version is available for $0.99 on Amazon.

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Blog

The NBA/Clippers Investigation: Part 2 – Conflicts in the Commercial Ecosystem

The Clippers investigation demonstrates why conflict controls must follow influence, economic benefit, and interconnected transactions, not merely financial ownership. In Part 2 of this five-part series, we consider what conflicts of interest are, why they are so divisive, and why compliance professionals must stay vigilant to prevent them from arising.

The most consequential conflicts of interest rarely arrive with a label. They appear as introductions, relationship management, commercial creativity, customer accommodation, or an effort to satisfy an important stakeholder. Each step may look defensible on its own. The compliance risk becomes visible only when the organization connects the people, payments, contracts, incentives, and timing. That is one of the central lessons from the investigation into the LA Clippers and Kawhi Leonard salary cap circumvention.

The independent investigators’ report (Wachtell Report) concluded that the Clippers initiated and facilitated endorsement opportunities between Leonard and four companies doing business with the team: Aspiration Partners, Boingo Wireless, Daktronics, and Lockton Insurance. Investigators further found that the team induced those companies to enter the endorsement arrangements by offering or providing Clippers business.

This was not a traditional conflict involving an executive awarding a contract to a company the executive secretly owned. It was a commercial ecosystem in which organizational business, personal relationships, vendor incentives, and benefits for a powerful player allegedly became intertwined. The Athletic seemed to believe that these conflicts were all at the behest of Leonard’s personal representative, Uncle Dennis. But even if the requests originated from the Leonard Camp, the Clippers put the entire sordid process into motion.

The Conflict Was in the Network

Conflict programs often focus on a narrow question: Does the employee have a financial interest in the counterparty? That question matters, but it is not enough.

The Wachtell Report identified personal and professional relationships involving Clippers President of Business Operations Gillian Zucker and two of the companies. At one company, her husband served as board chair during the relevant period, and Zucker reportedly had a 30-year working relationship with its chief executive. At another, she had a longstanding relationship with the president and recommended him internally as the Clippers considered service providers.

Relationships do not establish wrongdoing. Longstanding connections can create legitimate business opportunities. The compliance issue is whether the relationships were disclosed, independently evaluated, and removed from decisions that could benefit the related parties or another favored stakeholder.

Aspiration presented a different form of entanglement. In September 2021, Aspiration entered into a 23-year, $382.5 million sponsorship arrangement with the Clippers, a 23-year, $72 million sustainability services agreement for the Intuit Dome, and an agreement under which Steve Ballmer personally invested $50 million in Aspiration. Weeks later, the process leading to Aspiration’s proposed endorsement agreement with Leonard began.

Again, an investment, sponsorship, services agreement, or endorsement relationship is not inherently improper. The risk arose from their combination. Investigators concluded that Clippers personnel participated in developing Leonard’s endorsement arrangement and later approved Forum business that Aspiration’s co-founder had linked to completion of that endorsement deal.

The compliance question was therefore not simply whether Ballmer had disclosed his investment. It was whether anyone independently assessed the total relationship and asked whether the organization, its owner, its vendor, and its player were participating in genuinely separate transactions.

Procurement Leverage as a Compliance Risk

The Wachtell Report’s discussion of Daktronics makes the commercial leverage particularly clear. Daktronics was competing for the Intuit Dome scoreboard and signage business. According to investigators, Clippers personnel proposed directing part of the vendor’s expected “spend back” to an endorsement agreement with Leonard.

Daktronics reportedly believed that refusing could jeopardize its opportunity to win the arena contract. Investigators found that a Clippers executive specified the proposed endorsement economics and later requested an additional payment after the scope of the scoreboard purchase increased.

This is a critical third-party risk lesson. A vendor may appear to make an independent payment, but the customer’s purchasing power can shape its decision. The organization cannot treat the vendor as an independent actor if its executives use procurement leverage to influence the vendor’s decision.

The DOJ’s Evaluation of Corporate Compliance Programs (ECCP) directs prosecutors to examine the business rationale for using a third party, whether contracts accurately describe the services, whether the work was actually performed, whether compensation was commensurate with that work, and how third-party management is integrated into procurement and vendor management. Those questions apply well beyond anti-bribery enforcement.

They can be adapted to any commercial arrangement:

  • Why is this party entering the transaction?
  • Who proposed the arrangement and its economic terms?
  • Is another pending contract influencing the decision?
  • Are the services real, measurable, and proportionate to the payment?
  • Who ultimately receives the economic benefit?

If compliance cannot answer those questions, due diligence is incomplete.

The Limits of Disclosure and Recusal

Many organizations would respond to these facts by strengthening annual conflict questionnaires. That would help, but it would be insufficient. Annual disclosures capture static information. The Clippers matter involved dynamic relationships developing across sponsorship, procurement, personal investment, consulting, endorsement, and expense activity. No annual form could evaluate the full risk unless the organization also had transaction-level escalation.

Recusal presents a similar challenge. An executive can abstain from the final signature and still shape the outcome through introductions, recommendations, term-sheet comments, internal advocacy, or communications with the vendor. Effective recusal must address influence, not merely signature authority.

A defensible conflict process should contain four elements.

  1. Your organization needs a broad definition of conflict. It should cover actual, potential, and perceived conflicts, including close personal relationships, family roles, outside investments, prior professional affiliations, and benefits directed to third parties at an employee’s request.
  2. Disclosures must be tied to decisions. Procurement, legal, finance, compliance, and business approvers should receive relevant conflict information before approving the transaction.
  3. Independent reviewers or monitors must have access to the entire relationship. A sponsor agreement, consulting contract, personal investment, and endorsement deal cannot be reviewed in separate silos when they involve the same parties.
  4. Your organization must document how it managed the conflict. (Document Document Document) Approval should identify the business rationale, benchmarking, competitive process, recusals, alternative providers, deliverables, monitoring plan, and responsible control owner.

An Internal Control Issue, Not Just an Ethics Issue

Conflicts are frequently treated as personal ethics matters. They are also internal control risks. The COSO Internal Control–Integrated Framework provides the right lens. The control environment establishes expectations for integrity and accountability. Risk assessment identifies where influence and commercial pressure could distort decisions. Control activities impose approvals, segregation of duties, and documentation. Information and communication move relevant facts to independent decision-makers. Monitoring determines whether the controls work over time.

When conflicts span several transactions, the control system must aggregate information. A procurement reviewer may see a vendor contract. Finance may see an advance payment. Marketing may see an endorsement agreement. The owner’s office may see an investment. Compliance must be all four.

This is also a governance question. Under the Organizational Sentencing Guidelines, governing authorities must understand the compliance program and reasonably oversee its implementation and effectiveness. Board oversight becomes especially important when a transaction involves senior executives, controlling owners, or stakeholders whose commercial importance may compromise ordinary review.

The Clippers investigation shows that a conflict can exist without a secret ownership interest or a direct personal payment. It can arise when influence, relationships, and commercial leverage align to deliver a benefit that the organization could not provide directly.

Tomorrow in blog post 3, we will examine why the Clippers matter represents an internal controls failure and how procurement data, payment analytics, expense monitoring, and a substance-over-form review could have identified the pattern earlier.

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Blog

Ted Lasso Week: Part 2 – Rebecca Welton: Misuse of Authority, Conflicts of Interest, and the Path to Accountability

Season 4 of Ted Lasso is out. Matt Kelly reposted a blog he wrote during the original run of the series, and he and I did a deeper dive into the show and its popularity for compliance professionals in an episode of Compliance into the Weeds. I decided to take a deep dive into five characters from the show and use them to explore compliance topics. Over five blog posts, I will consider Manager Ted Lasso, Assistant Manager Nate Shelley, player and later coach Roy Kent, and social media influencer Keeley Jones. Today in Part 2, we consider compliance lessons through the character of team owner Rebecca Welton.

In Part 1, we considered how Ted Lasso built psychological safety and an ethical culture while sometimes allowing empathy to outrun accountability. Rebecca Welton presents the problem from the other side of the executive table. She begins as the source of AFC Richmond’s misconduct, then becomes the leader best positioned to acknowledge it.

Rebecca’s story is not simply a redemption arc. It is a governance case study about what happens when personal objectives capture corporate authority. It also shows why confession, forgiveness, and improved behavior are necessary but insufficient elements of an effective remediation program. The compliance lesson is direct: power creates risk when no independent mechanism can question the person exercising it.

When the Owner Becomes the Risk

In “Pilot” (Season 1, Episode 1), Rebecca hires Ted, an American football coach with no soccer experience, to manage a Premier League club. Her stated rationale is irrelevant because her actual purpose is to destroy the institution Rupert Mannion loves. She uses Richmond’s people, reputation, competitive position, and financial value to pursue a private grievance.

That is a classic conflict between personal interest and organizational duty. Rebecca is not accepting an envelope of cash or steering a contract to a relative. Her conflict is more fundamental: she has converted corporate decision-making into an instrument of revenge. The COSO Internal Control Framework begins with the control environment, including integrity, ethical values, oversight, authority, and accountability. At Richmond, the control environment fails at the top. The owner sets an improper objective, possesses the authority to execute it, and faces no visible independent challenge.

Compliance officers should take note. Conflicts of interest do not end with disclosure forms. They arise whenever personal relationships, status, resentment, financial incentives, or outside interests can distort business judgment. The greater the executive’s authority, the stronger the required safeguards.

Concentrated Authority Silences Challenge

Rebecca’s plan requires assistance. Higgins facilitates her agenda even though he recognizes the harm. In “Make Rebecca Great Again” (Season 1, Episode 7), Rebecca arranges for a photographer to capture Ted and Keeley in a compromising image. The objective is not legitimate media strategy. It is manufactured reputational damage intended to destabilize Ted and the club.

Higgins is not merely an unfortunate bystander. He is a senior employee who allows access, information, and organizational machinery to serve the owner’s improper purpose. His eventual resignation is a delayed act of conscience, but the episode demonstrates how authority can corrupt the escalation process. Employees may know that conduct is wrong and still conclude that challenging the owner is futile or career-ending.

The DOJ Evaluation of Corporate Compliance Programs asks whether “compliance personnel (1) sufficient qualifications, seniority, and stature (both actual and perceived) within the organization; (2) sufficient resources, namely, staff to undertake the requisite auditing, documentation, and analysis effectively; and (3) sufficient autonomy from management, such as direct access to the board of directors or the board’s audit committee.” It also asks whether managers encourage or discourage compliance through their conduct. Richmond has no credible independent function capable of reviewing Rebecca’s decisions, investigating her conduct, or escalating around her.

Accountability Begins With Truth

Keeley becomes the effective speak-up channel Richmond lacks. Once she discovers Rebecca’s scheme, she does not accept friendship, hierarchy, or reputational risk as reasons to stay silent. She insists that Rebecca tell Ted the truth. Rebecca finally does so in “All Apologies” (Season 1, Episode 9). She admits that she hired Ted to fail, orchestrated the paparazzi scheme, and engineered Jamie Tartt’s return to Manchester City to weaken Richmond. Most importantly, she does not minimize her purpose. She explains that she wanted to hurt Rupert and used Ted and the club to do it.

This is an effective apology because it identifies conduct, intent, and harm. It also accepts the possibility of consequences. Yet it is not a remediation. Nevertheless, Ted forgives her immediately, but an actual organization could not stop there. The U.S. Sentencing Guidelines require an organization to respond appropriately after misconduct and take reasonable steps to prevent similar conduct. DOJ asks whether the company performed a root-cause analysis, disciplined responsible individuals, repaired controls, and tested whether remediation works.

Richmond would need an independent review of affected personnel decisions, financial consequences, sponsor and stakeholder impacts, the use of confidential information, and Higgins’s role. It would also need governance changes that prevent one executive from repeating the conduct. An apology can reopen trust. Only remediation can reduce recurrence risk.

The Conflict Problem Returns With Sam

Rebecca’s growth does not eliminate conflicts. In “The Signal” and “Headspace” (Season 2, Episodes 6 and 7), Rebecca discovers that her anonymous Bantr match is Sam Obisanya, a Richmond player. Their relationship develops in “Man City” (Season 2, Episode 8) and continues secretly into “No Weddings and a Funeral” (Season 2, Episode 10).

The relationship is portrayed with warmth and mutual affection. That does not resolve the organizational issue. Rebecca owns the club that controls Sam’s employment environment. Her decisions can affect contracts, playing resources, sponsorships, reputation, and career opportunities. Even if she never exercises that power improperly, the imbalance creates an appearance of favoritism and raises questions about consent, retaliation, confidentiality, and recusal.

The compliance response is not moral judgment. It is a process. A conflict policy must apply to owners and senior executives, not only employees. Disclosure should go to an independent board member or committee. The organization should document safeguards, remove the conflicted leader from relevant decisions, protect the less powerful party, and monitor for retaliation or preferential treatment. Rebecca eventually pauses the relationship, but Richmond never appears to activate a formal conflict-management process. Personal restraint is not a control.

From Personal Ownership to Stewardship

Rebecca’s leadership changes when she stops treating Richmond as property and begins treating it as an institution held in trust for others. In “Do the Right-est Thing” (Season 2, Episode 3), Sam protests sponsor Dubai Air because of its connection to environmental damage in Nigeria. Rebecca backs the players despite the commercial risk. She recognizes that sponsorship revenue does not outrank organizational values.

Her transformation is clearest in “International Break” (Season 3, Episode 10). Edwin Akufo invites elite club owners to join an exclusive league built around scarcity, control, and profit. Rebecca rejects the proposal by reminding the room that football belongs to the people whose lives and communities give it meaning. She chooses stakeholder legitimacy over a lucrative insiders’ arrangement.

In “So Long, Farewell” (Season 3, Episode 12), she completes that shift by selling 49 percent of Richmond to its supporters. The woman who once used the club as a weapon ultimately distributes part of its ownership to the community.

This is what ethical remediation should seek: not a return to the status quo, but a more accountable operating model.

Questions for CCOs

Rebecca’s journey should prompt five questions:

  1. Can an allegation against the CEO, founder, controlling shareholder, or board chair bypass that person and reach an independent decision-maker?
  2. Do conflict rules cover personal relationships, vendettas, reputational motives, and executive discretion, or only financial interests?
  3. When senior misconduct occurs, who controls the investigation, discipline, disclosure, and remediation plan?
  4. Does the board receive reliable information about culture and mission-critical risks without management filtering?
  5. Are remediation measures tested, documented, and sustained after the responsible leader apologizes?
  6. Rebecca Welton shows that leaders can change. Compliance must make that change governable. Trust is rebuilt when truth is followed by independent review, proportional accountability, control improvements, and evidence that the organization learned.

Next Up: Nate Shelley and Culture Risk

Rebecca’s failure begins with power concentrated at the top. Nate Shelley’s failure develops lower in the organization, where insecurity, humiliation, status, and unaddressed resentment turn a once-overlooked employee into a destructive manager and trusted insider. In Part 3, we will examine the warning signs Richmond missed, the consequences of promoting technical talent without preparing them to lead, and why a speak-up culture must detect harm committed by newly empowered employees as readily as misconduct committed by executives.

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Daily Compliance News

Daily Compliance News: March 25, 2026, The Deadlocked Jury Edition

Welcome to the Daily Compliance News. Each day, Tom Fox, the Voice of Compliance, brings you compliance-related stories to start your day. Sit back, enjoy a cup of morning coffee, and listen in to the Daily Compliance News. All, from the Compliance Podcast Network. Each day, we consider four stories from the business world, compliance, ethics, risk management, leadership, or general interest for the compliance professional.

Top stories include:

  • FirstEnergy bribery jury deadlocked. (Ohio Capital Journal)
  • Trades bet over $500MM on oil immediately before the Trump announcement. (FT)
  • EU nearing decision on Google and EU competition law violation. (WSJ)
  • Lawmakers move to ban sports betting in prediction markets. (WSJ)
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Daily Compliance News

Daily Compliance News: March 20, 2026, The Flight Corridor Risk Edition

Welcome to the Daily Compliance News. Each day, Tom Fox, the Voice of Compliance, brings you compliance-related stories to start your day. Sit back, enjoy a cup of morning coffee, and listen in to the Daily Compliance News. All, from the Compliance Podcast Network. Each day, we consider four stories from the business world, compliance, ethics, risk management, leadership, or general interest for the compliance professional.

Top stories include:

  • Why did the lead investigator not testify in the FirstEnergy trial? (Cleveland.com)
  • The Nigerian ABC commission pays money back to NNPC. (Business Insider Africa)
  • Flight corridors and risk management. (NYT)
  • COI, corruption, and more in the Paramount deal. (WSJ)
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Daily Compliance News

Daily Compliance News: January 20, 2026, The First We Kill All the Lawyers Edition

Welcome to the Daily Compliance News. Each day, Tom Fox, the Voice of Compliance, brings you compliance-related stories to start your day. Sit back, enjoy a cup of morning coffee, and listen in to the Daily Compliance News. All, from the Compliance Podcast Network. Each day, we consider four stories from the business world, compliance, ethics, risk management, leadership, or general interest for the compliance professional.

Top stories include:

  • Those fighting corruption are under attack. (NYT)
  • Lawyers are endangered in the US. (FT)
  • DOJ to eliminate lawyers’ recusals from conflicts. (MTN)
  • Trump attacks the legal profession in the 2025 review. (EFF)
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FCPA Compliance Report

FCPA Compliance Report – Navigating Corporate Ethics and Compliance Trends in 2026 with Mike Volkov, Part 2

Welcome to the award-winning FCPA Compliance Report, the longest-running podcast in compliance. In this inaugural episode of 2026, Tom Fox welcomes back his good friend and colleague, Mike Volkov, to reflect on the tumultuous year of 2025 and discuss the new trends for the upcoming year. This is Part 2 of a two-part series.

This episode delves into the significance of the False Claims Act (FCA) as a critical tool for government enforcement, discussing its constitutionality and potential outcomes before the Supreme Court. The conversation expands to discuss how FCA applies across various areas, such as trade enforcement and tariffs, and how it encourages corporate whistleblowing. Additionally, the discussion highlights the growing role of technology, AI, and ChatGPT in compliance, as well as the risks associated with their use. Other focal points include the importance of conflict-of-interest programs and the impact of ethical conduct on marketplace dynamics. The episode underlines the growing scrutiny from financial institutions and private equity over compliance practices, as well as the long-term trend towards a more ethics-driven corporate culture.

Key highlights:

  • Supreme Court and Constitutionality Issues on the FCA
  • Corporate Whistleblowers and DOJ’s Stance
  • Technology, AI, and Compliance Risks
  • Conflict of Interest and Ethical Culture
  • Marketplace Accountability and Corporate Reputation
  • Financial Institutions and Due Diligence

Resources:

Mike Volkov on LinkedIn

Volkov Law Group

Tom Fox

Instagram

Facebook

YouTube

Twitter

LinkedIn

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Daily Compliance News

Daily Compliance News: January 14, 2026, The Ghost of Odebrecht Edition

Welcome to the Daily Compliance News. Each day, Tom Fox, the Voice of Compliance, brings you compliance-related stories to start your day. Sit back, enjoy a cup of morning coffee, and listen in to the Daily Compliance News. All, from the Compliance Podcast Network. Each day, we consider four stories from the business world, compliance, ethics, risk management, leadership, or general interest for the compliance professional.

Top stories include:

  • Why didn’t Trump think of this? (Haaretz) sub req’d
  • Former Panamanian President goes on trial for corruption. (KTBS)
  • What is a COI (Part 359)? (FT)
  • SEC punts on yet another fraud case. (Reuters)
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Daily Compliance News

Daily Compliance News: October 23, 2025, The Stay in Your Lane Edition

Welcome to the Daily Compliance News. Each day, Tom Fox, the Voice of Compliance, brings you compliance-related stories to start your day. Sit back, enjoy a cup of morning coffee, and listen in to the Daily Compliance News. All, from the Compliance Podcast Network. Each day, we consider four stories from the business world, compliance, ethics, risk management, leadership, or general interest for the compliance professional.

Top stories include:

  • More on BCG protocols. (WSJ)
  • Avoiding AI slop at work. (FT)
  • No Conflict of Interest here. (Reuters)
  • Belgian-EU prosecutor’s cross swords. (Euractiv)

The Daily Compliance News has been honored as the No. 2 in the Best Regulatory Compliance Podcast category.

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Daily Compliance News

Daily Compliance News: July 11, 2025, The What is a COI Edition

Welcome to the Daily Compliance News. Each day, Tom Fox, the Voice of Compliance, brings you compliance-related stories to start your day. Sit back, enjoy a cup of morning coffee, and listen in to the Daily Compliance News, all from the Compliance Podcast Network. Every day, we consider four stories from the business world, compliance, ethics, risk management, leadership, or general interest for the compliance professional.

Top compliance stories:

  • NFLPA head works for private equity. (ESPN)
  • UK to ban NDAs. (Bloomberg)
  • Turkey uses corruption claims to arrest opponents. (Reuters)
  • Bid-rigging in stadium development. (WSJ)

You can donate to flood relief for victims of the Kerr County flooding by going to the Hill Country Flood Relief here.