I have been busy and not been able to post any of my own stories this week. Here are some other compliance-related stories that recently caught my attention.
The Right Wing’s Assault on the Post Office – Smashing the Myth That It’s in Financial Trouble by Yves Smith in Naked Capitalism
That year, the Congress passed the Postal Accountability and Enhancement Act of 2006 (PAEA). Under the terms of PAEA, the USPS was forced to “prefund its future health care benefit payments to retirees for the next 75 years in an astonishing ten-year time span” – meaning that it had to put aside billions of dollars to pay for the health benefits of employees it hasn’t even hired yet, something that “no other government or private corporation is required to do.”The problem with the Post‘s argument starts in its thesis: that the post office is in some sort of deep fiscal hole of its own making – a result of being left behind in the Internet Age and a shrinking consumer base. The truth is that almost all of the postal service’s losses can be traced back to a single change in the law made by the Republican Congress in 2006. [More…]
Compliance at the Tipping Point, Part V – Protection Afforded From a Compliance Program by Tom Fox in the FCPA Compliance Report
Finally, is the last tipping point the Schrems decision from the European Court of Justice (ECJ), which invalidated the Safe Harbor provision through which American companies brought information developed through hotlines and internal information back to the US? The decision is much more far-reaching than simply the FCPA. For instance, Sarbanes-Oxley (SOX) mandates that a company have a hotline. But similarly to the response to the whistleblower provisions of the Dodd-Frank Act, companies must now be in a stronger position to quickly and accurately assess any potential violations that might be detected, reported or arise. This means not only thoroughly training your compliance function but it also puts more pressure on the underlying internal controls to give the compliance function the underlying information, on a more real-time basis about high-FCPA risk issues. Further, if you tie the Schrems decision together with the Yates Memo which requires a company to turn over information on individuals in very short order, to receive any credit from the DOJ, you see the need for a more robust prevention system in addition to other sources of information. [More…]
Sports Organizations Need Effective Integrity and Compliance Programs by David Dodge in SCCE’s The Compliance & Ethics Blog
Scandals have become as much a part of sports as players, officials, and spectators and surely it won’t be long before today’s outrage is replaced by fresh indignation over some other antics, be they on-field or after hours. Ben Franklin once noted, “It takes many good deeds to build a good reputation and only one bad one to lose it.”
Well-designed, effective integrity and compliance programs eliminate the embarrassments that roil sports every season. Well-structured programs that have the support of top leaders in the organization would be a huge first step towards making it clear that ethical behavior is expected and there will be consequences for transgressors.[More….]
Compliance Officers Call for SEC Enforcement Guidelines by Randi Val Morrison in the CorporateCounsel.net
On the heels of recent SEC enforcement actions against Chief Compliance Officers (CCO) and associated statements by Commissioners Gallagher and Aguilar and Chair White, the National Society of Compliance Professionals, a financial services industry trade group for compliance officers, sent this letter to SEC Director of Enforcement Andrew Ceresney requesting that the Commission establish policy that permits initiation of enforcement proceedings against CCOs only if they acted intentionally or recklessly – not negligently – to facilitate the underlying primary securities law violation.