Tag: compliance

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This Week in FCPA

Episode 266 – the Charlie Watts Tribute edition


As drumheads worldwide mourn the death of Rolling Stones drummer Charlies Watts and Jay goes ‘on the road’; Tom is joined by special guest host, Kristy Grant-Hart to look at some of this week’s top compliance and ethics stories which caught their interest on This Week in FCPA in the Charlie Watts Tribute edition. 

Stories

1.     Is ESG replacement for government inaction? Lawrence Heim in practicalESG.
2.     Why compliance should lead the ESG effort. Kristy Grant-Hart in Compliance Kristy
3.     What did the current Freddie Mac CCO learn from the 2008 financial crisis? Mengqi Sun in WSJ Risk and Compliance Journal.
4.     What is ‘intentional integrity’? Aly McDevitt in Compliance Week.
5.     Defense industry struggles with cybersecurity. Matt Kelly in Radical Compliance.
6.     How has the pandemic impacted the ABC fight in Latin America? Geert Aalbers in the FCPA Blog.
7.     More oral argument as both sides appeal Hoskins trial verdict. Dylan Tokar in WSJ Risk & Compliance Journal.
8.     Debunking attacks on the Business Roundtable’s Statement on the Purpose of a Corporation. Marty Lipton in Harvard Law School Forum on Corporate Governance
9.     The Mozambique hidden debt scandal. Rick Messick in GAB.
10.  What happens to compliance when you have a fractured C-Suite?  Mike Volkov in Corruption Crime and Compliance.

 

Podcasts and Events

11.  On Innovation in Compliance this week I interview Kristy Grant-Hart, Joe Murphy and Kirsten Liston about their latest book, The Compliance Entrepreneur. Check out the show here.
12.  On The Compliance Life, in August I visit with Kortney Nordrum CCO at Deluxe. In Episode 1, from Red Wing to Israel. In Episode 2, From Freddie Mac to the law. In Episode 3, how Kortney found her professional passion – Compliance.
13.  Compliance Week is having an open house this month as they have dropped their firewall. You can check out the entire publication for no charge. Check it out here.
14.  Breaking News features The Compliance Handbook, 2nd edition. Check out the Breaking News feature here. Purchase The Compliance Handbook, 2nd edition here. Find out more about The Compliance Handbook, 2nd edition in an upcoming Zoom webinar, on Wednesday, September 1 at 8:30 AM ET; hosted by the Azevedo Sette law firm and Charles River Associates. To RSVP email tcintra@azevedosette.br
15.  Join K2 Integrity September 15 for a round-table discussion as we reflect on the 20th Anniversary of September 11 and consider its impact on countering terrorist financing and illicit financing, and the continuing risks to national security. The roundtable will include members of the team that spearheaded the post-9/11 counter illicit finance regime: Juan Zarate, Chip Poncy, Danny McGlynn, moderated by Dr. Michele L. Malvesti. Information and Registration here.
16.  The week of 9/11, Tom will run a 6-part special podcast series on Looking Back on 9/11. In this series he will visit with professionals from a variety of compliance perspectives who will discuss how 9/11 changed our profession, including three who were in NYC during the attacks. Check it out on the Compliance Podcast Network.
17.  Tom pays tribute to Charlie Watts.
Tom Fox is the Voice of Compliance and can be reached at tfox@tfoxlaw.com. Special guest host Kristy Grant-Hart can be reached at kgranthart@sparkcompliance.com.

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Coffee and Regs

The Mood of Compliance

The Mood of Compliance

 

In this episode, CSS’s Executive Director, Jackie Hallihan and Senior Consultant, Adam DiPaolo discuss observations on the mood of compliance, with predictions of heavy regulatory activity, and key areas of focus including enforcement, ESG, cryptocurrency, whistleblowers and cybersecurity.

 

About Our Guest Speakers:

Jackie Hallihan is the Co-Executive Director of CSS’s Compliance Services team and has over 25 years’ regulatory and risk management experience. She was the founder of National Regulatory Services (NRS) which started the compliance resource business and served as its President for over 20 years. She also founded the National Society of Compliance Professionals (NSCP), a non-profit organization for compliance officers, staff and lawyers serving the compliance industry. It now boasts over 2000 memberships. Jackie has been a leading speaker to compliance professionals, including in-house training programs and various other industry association conferences, and has received numerous industry awards. Jackie also serves as Director, Clerk of the New England Broker Dealer Investment Adviser Association (NEBDIAA), a non-profit organization, incorporated in 1997. The purpose of NEBDIAA is to provide a forum for the professional exchange of information among investment advisers, broker dealers, and persons who provide services to investment advisers and broker dealers, and to direct communication among its members which will improve their ability to serve the needs of their respective clients. The forum will help NEBDIAA’s members meet the increased regulatory demands placed on investment advisers, broker dealers, and persons who provide services to investment advisers and broker-dealers.

 

Adam DiPaolo CISA, CRISC is a Section 13 Reporting Manager, Senior Consultant and Associate General Counsel at CSS. Adam designs practical solutions to manage regulatory challenges faced by hedge funds, private equity funds, funds of funds, and other investment advisers. In addition to providing compliance services such as annual compliance program reviews, risk assessments and acquisition due diligence, Adam established Section 13 reporting capabilities and EDGAR filing agent services for CSS’s Compliance Services division. He drafts and maintains corporate filings ranging from Forms ADV and PF to Forms 13F and 13H. Adam also provides cybersecurity risk management services to CSS clients – ranging from network vulnerability scanning to onsite cybersecurity risk assessments to assistance in implementing the NIST cybersecurity framework. He is a Certified Information Systems Auditor (CISA®), and Certified in Risk and Information Systems Control (CRISC™). Adam practiced corporate law prior to joining CSS and has an extensive background in both the public and private sectors. Adam served as Assistant General Counsel at Capgemini – one of the world’s largest providers of Consulting, Technology and Outsourcing services. As in-house counsel to a global consulting business, he implemented pragmatic strategies to resolve complex legal and regulatory issues. Adam earned his B.A. from Pitzer College, his J.D. degree from UC Berkeley – Boalt Hall School of Law, and his LL.M. in Taxation from New York University School of Law. He is a member of the New York State Bar.

 

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Blog

Day 22 of 30 Days to a Better Compliance Program, the Regional Compliance Committee

The Regional Compliance Committee operationalizes compliance into the Company’s Regional operations where the business operates. This approach follows the Department of Justice mandate, articulated in the Department’s FCPA Pilot Program, for companies to move the doing of compliance down into the organization’s business. The make-up of the Regional Compliance Committee, while including legal and compliance representatives, is also populated by representatives from other disciplines within the global organization, which allows a fuller, richer, and more holistic approach to compliance advice. It adds a dimension not often seen or discussed in the compliance profession. The accountability and oversight down to the Regional level and the compliance monitoring, reviewing, assessing, and recommending deemed necessary will provide additional endorsements to the organization that it is doing compliance. The Regional Compliance Committee can provide a unique structure to perform these functions.

Key Takeaways:

  1. A regional compliance committee can work to drive more efficient and robust compliance into the region.
  2. All regional leaders should be on the committee.
  3. The regional compliance committee should liaise with other compliance committees.

For more information, check out my book Doing Compliance: Design, Create and Implement an Effective Anti-Corruption Compliance Program, which is available by clicking here. The Regional Compliance Committee is uniquely suited to drive compliance down into the fabric and DNA of an organization.

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Blog

Day 21 of One Month to Better Compliance Through HR-Human Resources Gap Analysis for Compliance Issues

  • Does the HR department have an inventory of policies, procedures, laws, and regulations covering employees and employment-related matters applicable to the company’s business?
  • If yes, do you have a specified person in charge of updating the inventory?
  • If not, what system does the HR department utilize to ensure that it is aware of the various compliance laws and regulations and has a process to comply with them?
  • What evidence would the HR department be able to produce to the government to support a finding that the company has a solid compliance program for applicable labor and employment laws and regulations?
  • What types of compliance training are mandatory for all employees, which are optional, and how do HR track and document completion? How is the training performed? Is it provided in the native language of the employee or only in English?
  • What enforcement actions predominate in the compliance arena for your industry or where your organization does business? How is such data tracked in your company?
  • Are employees within the HR department specifically trained to understand compliance requirements applicable to your organization?
  • Does the HR department provide senior management with periodic updates on monitoring results, key risks, and compliance violations within HR?
  • Has the HR department established escalation criteria to ensure that high-risk compliance issues are reviewed at the corporate level?
  • Does the HR department have compliance monitoring standards in place?
  • Does the HR department perform periodic audits to ensure that the policies and procedures are complied with?

These are only a few of the questions that you may want to ask to begin the process of assessing how compliance and the role of HR apply to your company. My final suggestion is to work with HR to create a consolidated Human Resources Compliance Audit Checklist that can be used to audit (and document) the company’s HR Compliance Program. The key to compliance, in my opinion, is having the proper structure to identify the issues, implement policies and procedures to address the issues, audit for compliance, and document, document, and document.

Three Key Takeaways

  1. A gap analysis is a key component in the risk assessment process.
  2. The ultimate responsibility should lie with the business units and functional discipline to fully operationalize compliance.
  3. The role of the compliance department is to oversee, provide subject matter expertise, and coordinate.

This month’s series is sponsored by Advanced Compliance Solutions and its new service offering, the “Compliance Alliance,” which is a three-step program that will provide you and your team a background into compliance and the FCPA so you can consider how your product or service fits into the needs of a compliance officer. It includes an FCPA and compliance boot camp, a one-month podcast series sponsorship, and in-person training. Each section builds on the other and provides your customer service and sales teams with the knowledge they need to have intelligent conversations with compliance officers and decision-makers. When the program is complete, your teams will be armed with the knowledge they need to sell and service every new client. Interested parties should contact Tom Fox.

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Blog

Day 20 of 30 Days to a Better Compliance Program, the Board of Directors’ Compliance Committee

Key Takeaways

  1. This committee exists to provide oversight and assist the CCO, not to substitute its judgment for that of the CCO.
  2. This committee should work to hold the CCO accountable to hit appropriate metrics.
  3. This committee is ideal for leading the efforts around strategic planning.

For more information, check out my book Doing Compliance: Design, Create and Implement an Effective Anti-Corruption Compliance Program, which is available by clicking here.

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This Week in FCPA

Episode 265 – the Personal Responsibility edition


As Texas’ Governor-Mr. Personal Responsibility-himself comes down with Covid after refusing to engage in ‘personal responsibility’, Tom and Jay are back to look at some of this week’s top compliance and ethics stories which caught their interest on This Week in FCPA in the Personal Responsibility edition. 
Stories

  1. Corruption led to the fall of Afghanistan. Dick Cassin in the FCPA Blog.
  2. Does HSBC facilitate cybercrime. Elfriede Sixt in Risk and Compliance Journal Europe.
  3. The Pearson SEC enforcement action. Matt Kelly in Radical Compliance. Tom and Matt on Compliance into the Weeds. Kevin Lacroix in the D&O Diary.
  4. Trust and the CCO? Jeff Kaplan in Conflict of Interest
  5. Fraud during the pandemic. James Ruotolo in CCI.
  6. Inefficiency in AML enforcement. Maria Evstropova in CCI.
  7. SEC coming after cryptocurrencies. Aaron Nicodemus in Compliance Week.
  8. What Boards need to know before, during and after M&A. Maria Castanon Moats and Leah Malone in Harvard Law School Forum on Corporate Governance.
  9. Who is on your crisis management team? Eden Gillott in com.
  10. CFIUS publishes 2020 report. K2 Integrity Client Alert.

 Podcasts and Events

  1. On Innovation in Compliance this week I interview Dennis Kucinich about his latest book, The Division of Light and Power. Check out the show here.
  2. On The Compliance Life, in August I visit with Kortney Nordrum CCO at Deluxe. In Episode 1, from Red Wing to Israel. In Episode 2, From Freddie Mac to the law.
  3. How do the Greek Eumenes and the Roman Sertorius inform compliance leadership today? Find out as Tom and Richard Lummis continue their exploration of Plutarch’s Lives in this episode of 12 O’Clock High, a podcast on business leadership.
  4. Compliance Week is having an open house this month as they have dropped their firewall. You can check out the entire publication for no charge. Check it out here.
  5. Breaking News features The Compliance Handbook, 2nd edition. Check out the Breaking News feature here. Purchase The Compliance Handbook, 2nd edition here. Find out more about The Compliance Handbook, 2nd edition in an upcoming Zoom webinar, on Wednesday, September 1 at 8:30 AM ET; hosted by the Azevedo Sette law firm and Charles River Associates. To RSVP email tcintra@azevedosette.br

Tom Fox is the Voice of Compliance and can be reached at tfox@tfoxlaw.com. Jay Rosen is Mr. Monitor and can be reached at jrosen@affiliatedmonitors.com.

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Blog

Day 19 of 30 Days to a Better Compliance Program, Compliance Expertise on the Board

The Office of Inspector General (OIG) has called for greater compliance expertise at the Board level. The OIG said that a Board could raise its level of substantive expertise concerning regulatory and compliance matters by adding a compliance member to the Board. Such a compliance professional with subject matter expertise on the Board sends a strong message about the organization’s commitment to compliance, provides a valuable resource to other Board members, and helps the Board better fulfill its oversight obligations. Mike Volkov looked at it from both a practical and business perspective. He stated, “I have witnessed firsthand that companies with a board member with compliance expertise usually have a more aggressive and effective compliance program. In this situation, a Chief Compliance Officer has to answer to the board for the company’s compliance program while receiving the resources and support to accomplish compliance tasks.” Roy Snell sees it through the prism of the compliance profession and has said, “If you ask most companies if they have compliance expertise on their Board… most would say yes. When asked who the compliance expert is, they typically point to a lawyer, auditor, risk manager, or ethicist. None of these professions are automatically compliance experts. All lawyers have different specialties.” He goes on to state that what regulators want to see is specific compliance expertise at the Board level. He noted, “the government is looking for is not generic compliance expertise. They are looking for compliance program management expertise. Hui Chen, the DOJ Compliance Counsel, has continually talked about the need for companies to operationalize their compliance programs. She intones businesses must work to burn compliance into the fabric and DNA of their organization. Having a Board member with specific compliance expertise heading a Board level Compliance Committee can provide a level of oversight and commitment to achieving this goal. It will not be long before the DOJ and SEC require this step in any FCPA enforcement action resolution. This means that when your company is evaluated by Chen, under the factors set out in Prong Three of the FCPA Pilot Program, to retrospectively determine if your company had a best practices compliance program in place at the time of any violation, you need to have not only the structure of the Board level Compliance Committee but also the specific subject matter expertise on the Board and on that committee.

Key Takeaways

  1. Boards must have compliance expertise.
  2. Government regulators and shareholder groups have called for greater compliance expertise on the Board.
  3. Compliance expertise at the Board works up and down as such expertise can be a resource to the CCO and the compliance department.

For more information, check out my book Doing Compliance: Design, Create and Implement an Effective Anti-Corruption Compliance Program, which is available by clicking here. Both government regulators and shareholder groups have both called for greater compliance expertise at the Board.

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Coffee and Regs

The RIA Wild West of Going Independent

The RIA Wild West of Going Independent

 
In this episode, CSS’s Director of Retail Wealth Manager Services, Korrine Kohm and Founder of Transition To RIA, Brad Wales discuss the path to becoming an independent registered investment adviser, best practices to get started on your journey and compliance pitfalls to avoid.
 

 

About Our Guest Speakers:

Korrine Kohm is CSS’s Director of Retail Wealth Manager Services. Prior to CSS, Korrine was the Chief Compliance Officer and Head of Operations at Estabrook Capital Management where she was responsible for all compliance functions of this SEC-registered, $2.1B investment advisory firm. Korrine began her regulatory career while working at Allied Irish Bank (NY) in the Operations Department where she was a key member of AIB’s Compliance Committee, responsible for ensuring compliance with Federal and State regulations. An active member of the National Society of Compliance Professionals for over 10 years, Korrine earned her Investment Adviser Certified Compliance Professional (IACCPTM ) designation in 2006, is a member of the Association of Certified Fraud Examiners, and obtained her Certified Fraud Examiner designation. In addition to her experience in compliance and banking, Korrine began the 16-week intensive training course in Quantico, Virginia, to become a Special Agent with the Federal Bureau of Investigation. She has particular experience in crafting customized policies and procedures, developing and implementing compliance programs, conducting on-site compliance reviews, acquisition due diligence reviews, risk assessments and mock SEC examinations. She routinely counsels clients on various regulatory matters, including SEC registration issues, social media and advertising, policies related to diminished financial capacity, disclosures and the annual review process.

 

 
Brad Wales is the founder of Transition To RIA, a consulting firm uniquely focused on helping established financial advisors understand everything there is to know about WHY and HOW to transition their practice to the RIA model. Brad utilizes his nearly 20 years of industry experience, including direct RIA related roles in compliance, finance and business development to provide independent advice regarding how advisors can benefit from the advantages of the RIA model.

 

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This Week in FCPA

Episode 264 – the Infrastructure Bill edition


As the Tokyo Olympics conclude and Biden passes an infrastructure bill, Tom and Jay are back to take a look at this week’s stories top compliance and ethics stories which caught their interest on This Week in FCPA in the Infrastructure Bill edition.
 Stories

  1. Navex Global new benchmark report. Carrie Penman, Andrew Burt and Mary Bennett in Navex Global’s Risk & Compliance Matters blog.
  2. Conducting a double materiality assessment. Donota Calace in PracticalESG, Part 1 and Part 2.
  3. Dangers lurking in internal investigations? Mike Volkov in Corruption, Crime and Compliance.
  4. What can ‘ethics refugees’ teach us about E&C? Richard Shell in CCI.
  5. Running a design sprint. Carsten Tams with Part 4 of his 5-part series on Design Thinking in LinkedIn.
  6. Amazon tagged for €746MM for GDPR violations. Cordery Compliance news alert.
  7. What are the factors driving change in the investigation process? Jaclyn Jaeger in Compliance Week.
  8. The Achilles Heel of Compliance? Scott Moritz in LinkedIn.
  9. Ted Lasso and corruption. Harry Cassin in the FCPA Blog.
  10. 100 bottles of booze on the wall, 100 bottles of booze. Jeff Kaplan in the Conflict of Interest Blog.

 Podcasts and Events

  1. Innovation in Compliance hits its 200th anniversary show. I celebrate with Dan Skolnick from Accuity. Check out the show here.
  2. On The Compliance Life, in August I visit with Kortney Nordrum CCO at Deluxe. In Episode 1, from Red Wing to Israel.
  3. How do the Greek Timoleon and the Roman Aemilius inform compliance leadership today? Find out as Tom and Richard Lummis continue their exploration of Plutarch’s Lives in this episode of 12 O’Clock High, a podcast on business leadership.
  4. Compliance Week is having an open house this month as they have dropped their firewall. You can check out the entire publication for no charge. Check it out here.
  5. K2 Integrity’s Sepideh Rowland will moderate an ABA Webinar: Managing Compliance Under Pressure, August 17. Register and information here.
  6. The Compliance Handbook, 2nd edition is released. Learn about it here. Purchase it here.
  7. Each month Affiliated Monitors, Inc. introduces our readers and listeners to members of our AMI team. This month, in addition to our web Spotlight feature https://lnkd.in/g9aUbMaJ  we recorded a companion podcast with Deann Conroy, who is a Compliance Solutions Manager. She is an experienced attorney, leader, and educator of healthcare legal issues. Please follow the link in the show notes for this month’s double shot of our colleague Deanne! https://lnkd.in/gfTdF5mq

Tom Fox is the Voice of Compliance and can be reached at tfox@tfoxlaw.com. Jay Rosen is Mr. Monitor and can be reached at jrosen@affiliatedmonitors.com.

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Coffee and Regs

Preparing Private Funds for the Marketing Rule

Preparing Private Funds for the Marketing Rule

 
In this episode, our team of private funds experts, John Gentile, Eugenie Warner and Adam DiPaolo, discuss how private funds will be affected by the new Marketing Rule and how they can start preparing for implementation now.
 

 

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.

 

Eugenie Warner is a Senior Consultant at CSS, bringing her legal background to the Compliance Services arena. She was previously a business litigator, including as an associate at K&L Gates LLP and Loeb and Loeb LLP. Eugenie focused on consumer protection defense, primarily against federal and state regulatory agencies in administrative, state, and federal tribunals. Additionally, she managed cases and litigated in the fields of intellectual property, employment, civil contempt, unfair business practices, and deceptive advertising. Eugenie earned a B.A. in Diplomacy and World Affairs from Occidental College in Los Angeles; and a J.D. from the University of Connecticut School of Law, where she was on the Connecticut Law Review; clerked for the United States District Court, District of Connecticut; clerked for Connecticut’s Office of the Attorney General, Antitrust Department; worked in the Criminal Clinic, Appellate Division; and studied at the University of Dublin Trinity College School of Law, for which she received UCONN’s Elihu Burritt academic success award. Currently, Eugenie’s compliance work includes, for example: annual reviews, risk assessments, mock SEC exams, and other tailored analyses; detailed registration and reporting guidance; assistance to CCOs and other C-suite executives, to enhance their respective compliance programs and risk management; and other tailored services.
 
Adam DiPaolo CISA, CRISC is a Section 13 Reporting Manager, Senior Consultant and Associate General Counsel at CSS. Adam designs practical solutions to manage regulatory challenges faced by hedge funds, private equity funds, funds of funds, and other investment advisers. In addition to providing compliance services such as annual compliance program reviews, risk assessments and acquisition due diligence, Adam established Section 13 reporting capabilities and EDGAR filing agent services for CSS’s Compliance Services division. He drafts and maintains corporate filings ranging from Forms ADV and PF to Forms 13F and 13H. Adam also provides cybersecurity risk management services to CSS clients – ranging from network vulnerability scanning to onsite cybersecurity risk assessments to assistance in implementing the NIST cybersecurity framework. He is a Certified Information Systems Auditor (CISA®), and Certified in Risk and Information Systems Control (CRISC™). Adam practiced corporate law prior to joining CSS and has an extensive background in both the public and private sectors. Adam served as Assistant General Counsel at Capgemini – one of the world’s largest providers of Consulting, Technology and Outsourcing services. As in-house counsel to a global consulting business, he implemented pragmatic strategies to resolve complex legal and regulatory issues. Adam earned his B.A. from Pitzer College, his J.D. degree from UC Berkeley – Boalt Hall School of Law, and his LL.M. in Taxation from New York University School of Law. He is a member of the New York State Bar.