These are some of the compliance-related stories that recently caught my attention.
Day of Reckoning for KPMG – Failures in Ethics
Tom Fox
FCPA Compliance Report
How bad was KPMG’s conduct? It was so bad that I had to interrupt my previously started blog post series on continued allegations of bribery and corruption against US and other companies selling medical equipment into China, to blog about KPMG. In short, the conduct outlined in the Order is so egregious, detailing a culture which is completely unmoored from any ethical foundation, that any company using KPMG as an auditor must ask some very serious questions about not only the quality of the services they have received but also the very foundation of those services.
http://fcpacompliancereport.com/2019/06/day-reckoning-kpmg-failures-ethics/
CFTC Whistleblower Alert: Be on the Lookout for Insider Trading or Improper Use of Information
The Whistleblower Office of the Commodity Futures Trading Commission (CFTC) is issuing this alert to inform members of the public about how they may make themselves eligible for both financial awards and certain protections while helping stop the improper use confidential information.
https://whistleblower.gov/sites/whistleblower/files/2019-06/Insider%20Trading%20WBO%20Alert.pdf
Understanding the Money Laundering Risks in the Capital Markets
Financial Conduct Authority
The aim of this thematic review was to carry out a diagnostic piece of work looking at the money-laundering risks and vulnerabilities in the capital markets and, where possible, to develop case studies to help inform the industry. …
We visited 19 participants covering different segments of the market. Our population included investment banks, recognised investment exchanges, trade bodies, a custodian bank, clearing and settlement houses, inter-dealer brokers and trading firms. When we refer to ‘firms’ in this report, we are referring to the full range of firms involved in the market transaction chain. When we refer to ‘participants’, we mean those firms we included in our sample for this project. Our visits were diagnostic; we sought information and examples to further inform and enhance our view of the risks and vulnerabilities in the capital markets. We did not assess the systems and controls of participants.
https://www.fca.org.uk/publication/thematic-reviews/tr19-004.pdf
Compliance and Inconsistent Discipline
Matt Kelly
Radical Compliance
Because inconsistent discipline smacks of privilege undeserved. The company has one set of rules that apply to some people; and another set of rules that apply only to a select few. Those privileged few get special treatment, when most of the organization believes they shouldn’t — and that’s what drives employees bananas. That’s what ruins corporate culture and turns your corporate compliance program into a laughingstock.
http://www.radicalcompliance.com/2019/06/14/compliance-inconsistent-discipline/
Prequin Special Report: Subscription Credit Facilities
Subscription credit facilities: angels or demons? A legitimate and valuable tool for managing liquidity and streamlining transactions in a competitive market, or a cynical ploy for massaging IRRs? The debate continues in private equity and wider private capital circles.
https://docs.preqin.com/reports/Preqin-Special-Report-Subscription-Credit-Facilities-June-2019.pdf
https://profile.pmc.org/DC0176