Tag: compliance

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FCPA Compliance Report

FCPA Compliance Report – Billy Jacobson on Building a Boutique Law Firm

Welcome to the award-winning FCPA Compliance Report, the longest-running podcast in compliance. In this episode, Tom Fox welcomes Billy Jacobson, well-known to the compliance community, who recently opened a new boutique law firm, Jacobson Lopez. We talk about why he co-founded the firm, the type of work it takes on, and where he hopes it might grow.

Billy Jacobson is a seasoned attorney with a rich background in white-collar law and compliance, having served as a DOJ attorney and worked on high-profile fraud cases such as the Enron trials and as CCO at Weatherford. His experience and knowledge of AML, FCPA, and BSA practices shape his viewpoint on Jacobson Lopez, a boutique law firm that specializes in compliance and investigations. With his partner, Jonathan Lopez, Billy co-founded Jacobson Lopez, a boutique law firm offering specialized services in compliance work, internal investigations, government enforcement, and individual representation. They aim to provide big law firm expertise at more modest rates, with greater flexibility and no conflict issues, positioning their firm as an alternative to larger law firms. To gain more insights into Billy’s perspective and the work of Jacobson Lopez, join Tom Fox and Billy Jacobson on this FCPA Compliance Report podcast episode.

Key Highlights:

  • Boutique White Collar Law Firm in DC
  • Organic Growth and Strategic Partnerships in Law
  • Federal Prosecution Experience: Navigating Complex Legal Issues

Resources:

Billy Jacobson on LinkedIn

Jacobson Lopez

Tom Fox

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31 Days to More Effective Compliance Programs

One Month to a More Effective Compliance Program Through Culture: Day 9 – Fostering Culture with Psychological Safety

How can you improve corporate culture through speaking up? In an MIT Sloan Management Review, Summer edition, entitled “Fostering Ethical Conduct Through Psychological Safety” authors Antoine Ferrère, Chris Rider, Baiba Renerte, and Amy Edmondson asked such questions as “How do organizations encourage people to speak up about ethical breaches, whether inadvertent or deliberate?” and “Why do some employees choose to remain silent when others report misconduct?” Additionally, they “analyzed the perceptions of those who report misconduct against those of “silent bystanders” to help “better understand both the drivers and derailers of speaking up — and revealed insights into how leaders and compliance officers can encourage employees to make such reports.’”

The authors believe today, “it is more essential than ever that when misconduct happens or difficult problems arise, there is a strong ethical climate for surfacing information so leaders can respond quickly and appropriately. An environment in which employees feel comfortable reporting such issues is also vital to preventing future misconduct.”

The authors believe that a “healthy organizational culture is one in which speaking up and listening go hand in hand, reinforcing ethical standards. If concerns are expressed, changes can be made promptly.” This is important because it moves from the detect prong to the prevent prong, which is by far the most important and effective prong in any compliance regime. Further ideas or innovations, rather than simply reporting untoward actions, can make a company more efficient and more profitable. This means a company can receive far more benefits than monetary fines or penalty avoidance if psychological safety exists.

 Three key takeaways:

  1. How a speak-up culture improves your culture.
  2. What is the role of psychological safety in improving culture?
  3. What is the role of externals in your corporate culture?

Do you want to improve your culture? How can you assess your culture and develop a strategy to improve it going forward? In this free webinar on the new tool, The Culture Audit with Tom Fox and Sam Silverstein on Tuesday, November 28, 12 CT. For more information and registration, click here.

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Blog

Transforming Financial Communications Compliance in the Digital Age

This week I have a special five-part podcast series, sponsored by Verint on the Future of Communication in Financial Compliance on the Innovation in Compliance podcast series on the Compliance Podcast Network. My guest in this series is Phil Fry, VP and GTM of Financial Compliance Strategy at Verint. Over this series, we will take a deep dive into the current status of communications in financial institutions; how to be or not be compliant; an analysis and insight into the area; and how to avoid accentuating the negative and the human element in compliance. In this first post, we consider the current status of communications in financial institutions.

The financial industry’s compliance landscape has undergone significant changes in recent years, driven by factors such as hybrid working, Generative AI, and diverse communication modes. These changes have presented challenges for compliance solutions and vendors, making it harder than ever to keep up with evolving regulations. In this episode of the podcast “Future of Communication,” hosted by Tom Fox and featuring Phil Fry, the topic of adapting financial compliance solutions to evolving communication modes is explored in depth.

Financial firms today face more demanding challenges in adhering to regulations than ever before. The increase in unified communications, mobile phones, and changing client demands has transformed the way traders conduct business. Instead of traditional one-to-one conversations, there is now a growing use of conference calls and persistent interactions involving varying numbers of people. This shift, termed as non-binary communications by Verint, a leading provider of compliance solutions, adds complexity to compliance efforts.

Verint recognizes the need for a comprehensive solution that captures the entire communications environment, including voice and persistent chat. They are also at the forefront of pioneering generative AI-driven transcription, communications, pre-surveillance, and speech analytics capabilities. By aligning their solutions with the three lines of defense – business compliance, internal audit, and IT – Verint aims to provide financial firms with a holistic compliance solution.

One of the key challenges in adapting financial compliance solutions to evolving communication modes is the inconsistency in enforcing fines. While Tier one banks have borne the brunt of regulatory fines, there is still a lack of consistency in holding smaller financial institutions accountable. This inconsistency creates a sense of complacency among some institutions, leading them to believe they can get away with non-compliance. However, the increasing number of fines related to communication technologies like WeChat and WhatsApp highlights the importance of controlling all aspects of operations.

Compliance capture has traditionally been associated with fraud prevention. However, in the modern world, the focus has shifted towards managing conduct risk within organizations. Compliance technology solutions, such as Verint’s, play a crucial role in ensuring users act with integrity, due skill, care, and diligence. These solutions also help organizations treat customers fairly, adhere to market conduct standards, and support the needs of their employees.

When it comes to adapting financial compliance solutions, it is essential to consider the tradeoffs involved. Financial institutions often rely on highly advertised solutions that fall short of fulfilling regulatory requirements. For example, some vendors claim to capture Microsoft Teams chat compliantly but can only capture one-off sidebar conversations, not persistent chats with attachments. This lack of technology hampers compliance controls and exposes institutions to unnecessary risks.

In conclusion, adapting financial compliance solutions to evolving communication modes is a complex task. Financial firms must navigate the challenges posed by non-binary communications and changing regulatory landscapes. Compliance solution providers like Verint are at the forefront of addressing these challenges by offering comprehensive solutions and leveraging generative AI-driven technologies. As financial institutions face increasing fines and scrutiny, they must prioritize compliance and consider the impact of communication modes on their operations. By doing so, they can ensure they meet regulatory requirements and maintain the trust of their stakeholders.

For More Information check out Verint.

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31 Days to More Effective Compliance Programs

One Month to a More Effective Compliance Program Through Culture: Day 8-A Listening Tour to Improve Culture

Any top CEO must first listen. But it is more than simply listening to rebuild trust, it is rebuilding employee engagement by making them and their ideas part of the solution. Today, we consider how a compliance listening tour can improve culture.

A.    Engagement

Start off by meeting as many compliance stakeholders as possible. You can use town hall settings or go smaller, meeting with key employee leaders, key stakeholders, and employees identified as high-risk who you can meet with individually or in smaller groups. Listen to their compliance concerns and take their compliance ideas back to the home office. After returning to your office, winnow down their ideas and suggestions to form the basis of enhancements to your culture. This employee engagement will lead to greater stakeholder buy-in for your culture.

B.    Education

But during the town hall meetings, and the smaller more informal group meetings, you can do more than listen, you can also train. This training is on ethics and how the employees could use compliance as a business tool. Moreover, this lays the groundwork for enhancing your culture and the training that will occur as the enhancement is rolled out.

C.    Risk Assessment

Now, think about this same approach from the risk assessment perspective. Listen to your employee’s concerns and listen to the compliance issues raised. From there you can begin to ask questions about what was done and why. This approach is not adversarial or an interrogation. Still, it is ferreting out the employee’s concerns while having the employees educate your compliance team on the actual procedures that are used. By listening, and gently questioning, you should be able to garner enough information to create a risk assessment profile that can inform and even become the basis of compliance program enhancements.

Three key takeaways:

1. A listening tour can be used to improve your culture.

2. Listening improves engagement, which improves culture.

3. Culture lessens if employees think you don’t care.

Do you want to improve your culture? How can you assess your culture and develop a strategy to improve it going forward? In this free webinar on the new tool, The Culture Audit with Tom Fox and Sam Silverstein on Tuesday, November 28, 12 CT. For more information and registration, click here.

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The ESG Report

The ESG Report – Cally Edgren on Forever Chemicals

The ESG Report podcast is hosted by Tom Fox. Looking for innovative solutions to tackle climate change? Look no further than The ESG Report! In this episode, Tom speaks with Cally Edgren about Forever Chemicals.

Cally Edgren, a Senior Director of the Regulatory Expert team at Assent, has nearly three decades of experience in manufacturing and has dedicated her career to helping manufacturers comply with regulations. Edgren’s perspective on the regulation and impact of PFAS “forever chemicals” in manufacturing is that it is a game changer in the materials compliance world. She explains that PFAS are synthetic chemicals with tight carbon-fluorine bonds that have been used for their fantastic material properties, but these chemicals do not break down and have been found in water supplies and soil, raising health concerns. Edgren notes that regulators are starting to include PFAS chemicals in regulatory instruments, and states are being aggressive in addressing the contamination. She also highlights the supply chain disruption that will occur as major manufacturers like 3M discontinue products containing PFAS, emphasizing the need for manufacturers to consider the broader impact of PFAS regulations on their operations. Join Tom Fox and Cally Edgren on this episode of the ESG Report podcast to learn more about this critical issue.

Key Highlights:

  • The Persistence of PFAS Chemicals
  • The Broader Risks of PFAS Contamination
  • Implications of PFAS Regulations on Manufacturers
  • Stricter State Regulations on PFAS Use
  • PFAS Litigation and Industry Disruption

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Cally Edgren on LinkedIn

Assent

Tom Fox

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31 Days to More Effective Compliance Programs

One Month to a More Effective Compliance Program Through Culture: Day 7- To Improve Culture, Engage More

One thing I have learned in working with Carsten Tams is that one of the very top keys to a successful compliance program is employee engagement. Tams and I explored this topic in the popular podcast series Design Thinking in Compliance. It also appears that attention can lead to excellent business resiliency based upon an article entitled The Top 10 Findings on Resilience and Engagement, by Marcus Buckingham.

Not surprisingly, trust is the number 1 factor in engagement and resilience. Astoundingly, the author found that “employees who said they completely trust their team leader were 14 times more likely to be fully engaged.” Moreover, those employees who completely trusted their colleagues, team leader, and senior leaders “were 42 times more likely to be highly resilient.” The reason should seem obvious as it is undoubtedly “easier to engage in our best work when we don’t have to expend mental resources looking over our shoulders or protecting ourselves against dysfunctional workplace practices that erode trust, like bullying or micromanaging. When it comes to building engagement and resilience, trust is everything.”

Teamwork is also a key factor. Although this is not something I have experienced over the past 12 years of working alone, the author found, “Those who said they are on a team were 2.6 times more likely to be fully engaged and 2.7 times more likely to be highly resilient than those who didn’t identify as team members. For millennia, humans have experienced psychological well-being only when they feel connected to and supported by a small group of people around them.” When the pandemic hit, working from home was not new to me as I had been doing it since 2010, but even in the WFH or Hybrid Work era, most employees need to feel like they are part of a team.

Every CCO and compliance professional must work to lessen or dissolve the disconnect between senior leadership and front-line workers. Your front-line business folks will make or break your compliance program. Getting your senior management more engaged will create and establish the trust your employees will need to show resilience in the face of the following primary business location, whether a pandemic or military invasion.

 Three key takeaways:

  1. The concepts from Design Thinking can improve your culture.
  2. A key factor in culture is engagement.
  3. You can improve culture by dissolving the disconnect between senior leadership and front-line workers.

Do you want to improve your culture? How can you assess your culture and come up with a strategy to improve it going forward? Find out in this free webinar on the new tool, The Culture Audit with Tom Fox and Sam Silverstein on Tuesday, November 28, 12 CT. For more information and registration, click here.

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Great Women in Compliance

Great Women in Compliance – The State of the Profession

As we move towards the end of 2023, and after the major conferences of the year, it seemed like a good time to reflect on the state of the profession.  Gwen Hassan, Deputy Chief Compliance Officer at Unisys and host of the #HiddenTraffic podcast, and Kim Yapchai, member of the Board of Directors for DirectWomen and former Senior Vice President, Chief Environmental, Social and Governance Officer at Tenneco joined Ellen Hunt and Lisa Fine talk about where the ethics and compliance profession has been, where we are today, and where we are going.  They discuss what makes them optimistic, and what gives them pause.

The Great Women in Compliance Podcast is on the Compliance Podcast Network with a selection of other Compliance-related offerings. GWIC is also sponsored by Corporate Compliance Insights, where we have a page where you can hear every episode. If you are enjoying this episode, please rate it and/or provide a review.

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.

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31 Days to More Effective Compliance Programs

One Month to a More Effective Compliance Program Through Culture: Day 6 – Attributes of a Toxic Culture

Corporate culture is finally being acknowledged as a key ingredient in a successful business, particularly one that operates ethically and in compliance. But what are some indicia of good culture and more importantly what are some indicia of a toxic culture? A recent article in the MIT Sloan Management Review provided some guidance. In Why Every Leader Needs to Worry About Toxic Culture, the authors posited that by pinpointing the elements of toxic culture in a company, its leaders focus on addressing the issues that lead employees to disengage and quit. These ideas have significant importance for the compliance function as it navigates corporate culture, both in assessing and improving it.

Moreover, the Chief Compliance Officer and corporate compliance function were identified in the 2023 3 Evaluation of Corporate Compliance Programs as the keepers of institutional justice and institutional fairness. This means recognizing and then preventing a toxic culture from spreading and infecting your entire organization squarely in the compliance wheelhouse. The article lays out key red flags for every CCO and compliance professional to look for in assessing culture. Finally, for any company with a toxic culture, the chances are much greater to be defrauded by its own employees or to defraud others through bribery and corruption by violating such laws as the Foreign Corrupt Practices Act (FCPA).

The authors identify behaviors that they call “the Toxic Five attributes”, being “disrespectful, noninclusive, unethical, cutthroat, and abusive – poison corporate culture in the eyes of employees. While organizational culture can disappoint employees in many ways, these five elements have by far the largest negative impact on how employees rate their corporate culture and have contributed most to employee attrition throughout the Great Resignation.” As a CCO or compliance professional you need to be on the watch for them and take steps to remedy them if you see or hear about them.

 Three key takeaways:

1. Are the attributes of a toxic culture present in your organization?

2. The 2020 Update to the Evaluation of Corporate Compliance Programs mandated the compliance lead this effort.

3. Does your organization have abusive behavior?

Check the free webinar on the new tool, The Culture Audit with Tom Fox and Sam Silverstein on Tuesday, November 28, 12 CT. For more information and registration, click here.

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Compliance Into the Weeds

Compliance into the Weeds – Remediation During an Enforcement Action

The award-winning Compliance into the Weeds is the only weekly podcast that takes a deep dive into a compliance-related topic, literally going into the weeds to more fully explore a subject. Looking for some hard-hitting insights on compliance? Look no further than Compliance into the Weeds! In this episode, Tom and Matt take a deep dive into the issue of how and whether you should remediate during an enforcement action.

The importance of early and continuous remediation of compliance issues cannot be overstated. It is a critical aspect of maintaining a healthy relationship with regulators and ensuring effective strategies are in place to address any uncovered issues. Tom firmly believes in the necessity of initiating the remediation process as early as possible, even during the investigation phase. He emphasizes the importance of regular communication with regulators and the potential risks of delaying remediation.

Matt echoes Fox’s sentiments. He highlights the confidence that early remediation brings to compliance officers and the increased likelihood of successful resolution. Join Tom Fox and Matt Kelly as they delve deeper into this topic in this episode of the Compliance into the Weeds podcast.

 Key Highlights:

  • Proactive Remediation for Effective Compliance Management
  • Navigating Personnel Matters During Remediation
  • Logical and Consistent Employee Discipline Compliance
  • Remediation Strategies for Confident Compliance Officers

 Resources:

Matt on Radical Compliance

Tom 

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Blog

GWIC Roundtable: The Importance and Challenges of Compliance in Corporate America

The compliance profession plays a crucial role in ensuring ethical practices and maintaining regulatory compliance within corporate America. In a recent episode of the Great Women in Compliance Podcast, Lisa Fine and Ellen Hunt, a former Chief Ethics and Compliance Officer, chief Audit Officer and Chief Privacy Officer, and currently Principal Consultant and Advisor with Spark Consulting;  hosted Gwen Hassan, Deputy Chief Compliance Officer at Unisys (and host of the award winning Hidden Traffic podcast) and Kim Yapchai, currently a board member of Direct Women, which is a nonprofit focused on promoting women to be public company board members and expert in a variety of corporate areas including ESG, corporate governance, M&A, compliance and Supply Chain. They discussed the importance and challenges of the compliance profession in today’s corporate landscape.

One of the key challenges highlighted by Yapchai is the struggle for recognition and resources within organizations. Compliance professionals often report to the General Counsel (GC) rather than the CEO, which can hinder their ability to have a seat at the table and influence decision-making processes. Additionally, limited access to data and budget constraints can further impede the effectiveness of compliance programs.

Yapchai see Compliance 1.0 as “being the police. Compliance 2.0, looking at culture and working with HR. Compliance 3.0 I think is really the type of ESG role that I had in my last role and reported to the CEO as part of the executive leadership team.” She believes this is another step in the compliance function being changed. It has moved to “to revenue protector, brand protector incorporating know and it is the people that drive everything. And all of this leads to better profits, it’s better risk management.”

To overcome these challenges, the speakers emphasize the need for compliance professionals to build key relationships, understand the nuances of the business, and effectively communicate the value of compliance programs. Hassan suggests that speaking the language of the business, using terms like return on investment (ROI), and showcasing the financial impact of compliance efforts can help gain traction and support from the C-suite and the board. By demonstrating the value of compliance in dollars, compliance professionals are more likely to capture the attention of business leaders who think in terms of profit margins and ROI.

The speakers also stress the importance of continuous growth and adaptation in the compliance profession. As the business landscape evolves, compliance professionals must stay abreast of new challenges, such as ESG (Environmental, Social, and Governance) and AI (Artificial Intelligence). They need to actively seek opportunities to expand their roles beyond traditional compliance functions and become revenue protectors and brand protectors. By incorporating culture and working closely with HR, compliance professionals can contribute to better risk management and overall profitability.

However, the speakers caution against complacency and the risk of devaluing the work of compliance professionals. Hassan believes that if the profession fails to grow and adapt, it could contribute to the moral decline of corporate America. Compliance professionals have a unique opportunity to shape the values and impact of organizations, not just in terms of financial success but also in making the world a better place for all stakeholders. By embracing a holistic view of what a company represents, compliance professionals can help drive positive change and ensure ethical practices.

Hassan went on to say she has ‘tempered optimism’ for the compliance profession. She believes that employees know what our intent and what we are trying to do. She notes that the compliance profession has “done herculean work in some particularly crazy times, especially over the last ten to 15 years.” Yapchai agreed and related that “when I started, the concept of a compliance officer and a compliance function was something that was brand new and really a heavy lift when talking to companies about compliance because it was almost unheard of to have a separate compliance department and a separate compliance team and report into the board.” In many ways compliance was seen as an  “offshoot of what the law department was already doing” but there has been much improvement in that view.  The status of the profession has been elevated and there are now colleges and law schools that are now teaching separate programs in compliance. This means that Gen Z and Millennials are studying compliance as a specific degree.

Creating a supportive community, or what the speakers refer to as a “Blue Zone,” is also crucial in combating the stress and loneliness that can come with the compliance profession. It helps people live longer and healthier, but the concept that you can create your own right with your surroundings and the way your daily habits and other things you can create your own. All of the speakers feel that it is important for ethics and compliance professionals to have their blue zone or their network or their support group by connecting with peers and sharing experiences, compliance professionals can find support and inspiration to navigate the challenges they face.”

In conclusion, the compliance profession in corporate America is of utmost importance in ensuring ethical practices and regulatory compliance. However, it faces challenges such as limited resources, lack of recognition, and the need to continuously adapt to a changing business landscape. By building relationships, understanding the business, and effectively communicating the value of compliance programs, compliance professionals can overcome these challenges and contribute to the success and ethical standing of their organizations.