2022 saw higher numbers of FCPA enforcement actions, settlements, and criminal prosecutions of individuals. One of the most important developments was the update of policy in the Monaco Doctrine, which was elaborated on in the Monaco Memo, providing important guidance for compliance professionals. Tom Fox joins Michael Volkov to discuss some of the more interesting cases from the past year.
Tom Fox is hailed as the Voice of Compliance, serving and evangelizing for the compliance community for over 15 years. He is the founder and creator of the Compliance Podcast Network where he hosts various podcasts, such as Innovation In Compliance and the ESG Report, and the Executive Leader at the C-Suite Network.
Some ideas you’ll hear them explore are:
- The DOJ is getting better at communicating with the compliance community through resolution documents like DPA, NPA, and, occasionally, declinations. These documents provide insight into the DOJ's thinking and approach to cases, which compliance professionals can use to gain a better understanding of how to approach compliance issues.
- In Tom’s upcoming book, “FCPA Year in Review 2022,” he highlights the KT Corp bribery case, which went back to the basics in its old-school rendition of corruption: bags of cash money. The lesson here is that bribery can be as simple as a $50 slipped into a handshake.
- In the curious case of Glencore, the FCPA enforcement action taken against them reflects the DOJ’s focus on defective cultures within companies. This case involved multiple enforcement agencies across multiple countries and multiple bribery schemes, rounding up fines and penalties totalling up to $1.1 billion, with $700M for FCPA violations, and $441M for price and market manipulation. Glencore had a culture that was committed to profit at any cost, and the company paid over $100M to third parties knowing that some of the money would be used to bribe officials in various countries.
- The Oracle case involving bribery and corruption involving gifts, travel, and entertainment should serve as a reminder to companies to review their gift, travel, and entertainment policies and ensure they are aware of how their business officials are spending their travel, per diem, and entertainment money.
- Avoid hiring third-parties recommended by or at the direction of a state-owned official or executive.
- The Lisa Monaco memorandum emphasizes the need for effective compliance programs and the benefits of voluntary disclosure, full cooperation, and timely and appropriate remediation.
KEY QUOTE“Internal controls are not simply due diligence, distributors, et cetera. It goes down to your payments, schemes and how you pay your vendors should all be a part of your internal controls.” - Tom Fox
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