Category: Compliance Bricks and Mortar

Here are some recent stories that I found interesting:

The FCPA’s Long Tentacles by FCPA Professor

One reason is that mere existence of an FCPA inquiry can significantly throw a wrench into a company’s ability to sell itself. Another reason is that mere existence of an FCPA inquiry can cause an analyst to downgrade a company’s stock.

How to Fail as a Compliance Officer by Frank Sheeder in the Healthcare Compliance Blog

In my view, compliance professionals must establish themselves as leaders, whether formal or informal, in their organizations. If they don’t, they are destined to fail. Here are some ways to botch the effort to become a leader: …

Changes in Securities Enforcement Thanks to Dodd-Frank by Bruce Carton in Securities Docket

Only a portion of the Dodd-Frank Act is directed at enforcement of securities laws by the Securities and Exchange Commission. Nevertheless, that portion contains numerous important provisions that will affect public companies, regulated entities, and professionals in the enforcement and compliance areas. Let’s take them all in turn.

No Good Deed Goes Unpunished from the FCPA Blog

As a part of a yet unpublished paper, [Bruce Hinchey considers] the data from 40 FCPA cases from 2002 through 2009 and the differences between bribes paid and penalties levied against companies that do and do not self-disclose.

Squid is by Laughing Squid and used under a Creative Commons License.

Here are some recent stories that I found interesting:

When Compliance and Legal Functions Collide by Matt Kelly in Compliance Week‘s Big Picture

The general counsel is still the boss. Yes, I know, the revised U.S. Sentencing Guidelines say companies should have an independent compliance function, with a chief compliance officer who answers to the CEO or (ideally) the board. Well, that’s not happening yet. Fourteen of our 20 attendees said they report into the legal function; only two reported directly to the audit committee.

SEC Expects Massive Staff Increase Needed to Implement FinReg in Compliance Avenue

SEC Chairman Mary Schapiro, during her Testimony Concerning Oversight of the U.S. Securities and Exchange Commission: Evaluating Present Reforms and Future Challenges, which she gave before the United States House of Representatives Committee on Financial Services Subcommittee on Capital Markets, Insurance and Government-Sponsored Enterprises, stated that the Commission expects to hire approximately 800 new positions during the course of the implementation.

Criminal Provisions in the Dodd-Frank Dodd-Frank Wall Street Reform & Consumer Protection Act by NACDL’s White Collar Crime Section

Here are some recent stories that I found interesting:

Canada and the Corruption of Foreign Officials Act by Tom Fox

The CFPOA was passed in back in 1999. However, up until this year, there was only one enforcement action under the legislation involving a Canadian company and no prior enforcement actions against individuals. The Canadian government, as a signatory to the OECD Treaty Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, felt an obligation to actively enforce its foreign anti-corruption and anti-bribery statute. This led to the funding for and creation of two RCMP units dedicated to enforcing the act, in 2008.

Defendant Used Blackberry PIN Messages to Avoid Feds by Ryan J. Reilly in Main Justice

According to the DOJ, Farkas and his co-conspirators made efforts to disguise their alleged fraud by communicating using a feature on their Blackberry phones that allowed them to send so-called “PIN messages,” which are similar to text messages but not routed through or saved on a computer server.

What One Mizzou Grad Learned in Law School by Kashmir Hill in Above the Law

I’m studying for the bar right now, and to be honest, little of this sounds like what I learned in law school. So I said to myself, if I didn’t pick up these 20-odd topics, what did I learn? He came up with a list of the 17 things he learned in law school.

Site offers Better Access to Federal Rulemaking in Robert Ambrogi’s LawSites

But Regulations.gov is difficult to use for experts and average citizens alike, say the founders of a new site, OpenRegs.com. They have created this site “to make the proposed and final regulations published in the Federal Register easy to find and discuss, so that citizens can become better informed and more involved.”

How Embarrassing… Westlaw Reference Attorneys Are Blogging… And You’re Not?? by Greg Lambert in 3 Geeks and a Law Blog

Westlaw’s Reference Attorneys have set up their own blog where they focus on the needs of Summer Associates and produce blog posts that point out some of the needs expressed by Summer Associates and relay that to others. The bloggers share information that comes in from Summer Associate calls in order to identify trends (such as issues on the gulf oil spill), and get someone to blog about how they’ve handled the issues so that others can benefit from the experience.

Here are some recent stories that I found interesting:

Who Does Your Chief Compliance Officer Report To? by Thomas Fox in a guest post on The FCPA Blog

Should a CCO report to a company’s Board of Directors, or an appropriate Board committee such as an Audit Committee or Compliance Committee? Or can a CCO report to a company’s General Counsel (GC) but have access to the Board of Directors for periodic, but no less than annual, reporting? Is there any specific guidance from the Foreign Corrupt Practices Act (FCPA) or any of its U.S. government interpretations such as the U.S. Sentencing Guidelines? Is one approach more preferable than the other?

The Ethics of Perception vs. Reality by Kathleen Edmond, Best Buy’s Chief Ethics Officer

Is it OK for our employees to engage company vendors in private contracts unrelated to their work on behalf of Best Buy? Why or why not?

Why Congressional Insider Trading is so Profitable in ProfessorBainbridge.com

In my paper, The Stop Trading on Congressional Knowledge Act, I explained that a 2004 study of the results of stock trading by United States Senators during the 1990s found that that senators on average beat the market by 12% a year. In sharp contrast, U.S. households on average underperformed the market by 1.4% a year and even corporate insiders on average beat the market by only about 6% a year during that period. A reasonable inference is that some Senators had access to – and were using – material nonpublic information about the companies in whose stock they trade.

Congressman attacks student videographer on public street by Carlos Miller in Photography is Not a Crime

Bob Etheridge, a Democratic Congressman from North Carolina was walking down the street in Washington DC when he was asked a simple question by a student videographer “Do you fully support the Obama agenda?” The Congressman got irate and began demanding “who are you? who are you?” He then took a swing at the student before grabbing his wrist.

BP: Still not as evil as Goldman Sachs by Felix Salmon

Here are some interesting stories from the past week:

SEC Union: Staff Need Not Check BlackBerrys After Hours by Bruce Carton in Compliance Week‘s Enforcement Action

In short, Khuzami and his senior colleagues can call, email and text SEC Enforcement staff all they want after hours–but can’t do much about it if staff members fail to pick up or respond until the next business hours begin. Chapter 293 President Greg Gilman stated in February that “a great many employees expressed concerns about being ‘on call’ 24/7. This is the type of quality of life issue about which we feel the Union is in the best position to make a big difference for SEC employees.” Gilman added that “it wouldn’t be fair to characterize employees as lazy,” according to Business Week.

FBI Uses Terror-Probe Tactics on Fraud by Devlin Barrett in the Wall Street Journal

Federal Bureau of Investigation officials in New York are increasingly employing tools and techniques used to hunt terrorists to take aim at a different kind of criminal: white-collar con artists and inside traders.

My iPad? A Great Bundle of Sticks by Andrew McAfee

“I feel about it the way Winston Churchill felt about democracy, which is that it’s the worst system for organizing economic activity except for all those other forms that have been tried. I believe that America’s extraordinary track record of innovation and creativity exists not despite its IP laws, but at least in part because of them. I applaud the fact that IP creators and owners have strong rights to exclude, even when these creators and owners are big, powerful corporations. And I really like the bundle of sticks contained in my iPad.”

DOJ Guidance and the FCPA by James Parkinson in the FCPA Professor

This suggests another question: what would the commentary landscape look like today if the DOJ published a new Federal Register notice soliciting “views concerning the extent to which compliance with 15 U.S.C. 78dd-1 and 78dd-2 would be enhanced and the business community assisted by further clarification of the provisions of the anti-bribery provisions through the issuance of guidelines”?

Bigger, Stronger, Faster: The PCAOB After The Supreme Court Ruling by Francine McKenna at re: The Auditors

The Supreme Court will decide on Free Enterprise Fund v. PCAOB before their session is concluded on June 28th. Whether the PCAOB is or isn’t declared unconstitutional, there are some key gaps in the original Sarbanes-Oxley legislation that should be addressed. Now is the time to give the PCAOB the tools it needs to be as effective as possible.

TRACE Releases First Summary of Global Ant-Bribery Activity from the WrageBlog

The good news is enforcement of international anti-bribery laws is increasing. The bad news is many countries have yet to leave the anti-bribery enforcement starting line. TRACE International released its first-ever summary of worldwide anti-bribery activity today, and it is evident from its data that enforcement is gaining momentum. The TRACE Global Enforcement Report (GER) 2010 summarizes 33 years of enforcement activity by nations around the world.

Here are some recent stories that I found interesting:

The Auditors And Financial Regulatory Reform: That Dog Don’t Hunt by Francine McKenna in re: The Auditors

The firms are broken and their basic product is worthless. The auditors were completely impotent to warn investors of over-leverage and risky business models, to prevent erroneous and potentially fraudulent financial reporting and to mitigate the impact on everyone of these errors, misstatements, obfuscations and subterfuge by executives of the failed, bailed out and nationalized financial institutions.

Why Links Belong in text by Felix Salmon in Reuters

A blog entry with links at the bottom has aspirations to being self-contained, like say a newspaper column: the links are optional extras. I never have such aspirations and anybody looking to make full use of the power of the internet is doing themselves a huge disservice if they start thinking that way. In these days of tabbed browsing, there’s a difference between clicking and clicking away: most of us, I’m sure, control-click many times per day while reading something interesting, letting tabs accumulate in the background as we find interesting citations we want to read later.

Whistleblowers, Cooperators Making Their Way to the SEC’s Door by Kara Scannell in WSJ.com‘s Law Blog

While speaking at a recent Practicing Law Institute seminar, Reisner said the SEC has signed 10 cooperation agreements so far with other potential deals in the pipeline. The insiders are helping investigators in probes involving insider trading, financial and accounting fraud, stock offering frauds, and public company disclosures, he said. Reisner said the vast majority of cooperators came in the door after the probes were already underway. “One was a situation where someone walked in the door,” he said.

Dan Ariely asks, What is the right amount to pay bankers? in TED blog

To look at the question of how bonuses affect performance, Uri Gneezy, George Loewenstein, Nina Mazar, and I conducted a few experiments. In one, we gave participants an array of tasks that demanded attention, memory, concentration, and creativity. We asked them, for instance, to fit pieces of a metal puzzle into a plastic frame, to play a memory game that required reproducing a string of numbers, to throw tennis balls at a target, and a few other such tasks. We promised payments of different amounts (either low, medium, or very high bonuses) if they performed any of these tasks exceptionally well. About a third of the subjects were told they’d be given a small bonus (relative to their normal wages), another third were promised a medium-sized bonus, and the last group could earn a very high bonus.

Four-Year Sentence In Haiti Case in The FCPA Blog

A former employee of Haiti’s state-owned national telecommunications company was sentenced yesterday to 48 months in prison for being part of a bribery and money-laundering scheme. Robert Antoine, 62, of Miami and Haiti, pleaded guilty in March this year to conspiracy to commit money laundering. He was also ordered by the federal judge in Miami to pay $1,852,209 in restitution and to forfeit $1,580,771, and serve three years of supervised release following his prison term.

What’s Your KM? by Mary Abraham in Above and Beyond KM

Substitute compliance for KM:
Critics says that the inability of knowledge management proponents to settle on a universally accepted definition of KM is a sign of failure. Others say that the lack of definition and resulting ambiguity present marvelous opportunities. If you are like me (i.e., firmly settled in the second camp), then it is doubly important not to let the discipline’s perceived lack of definition translate into a personal lack of definition. Knowledge managers who lack definition make administrators very nervous. And that is not career enhancing. So the real challenge for knowledge managers is to define themselves and their work, and then help the administrators understand and accept that definition.