Are compliance officers at financial institutions now in the hot seat for fines?

Stanley Foodman – The Yucatan Times – August 16, 2016

Otherwise reputable financial institutions continue being sanctioned for regulatory non-compliance.  Well known “household” names continue receiving fines for failing to establish and implement adequate Anti-Money Laundering (AML) procedures.  The Financial Industry Regulatory Authority (FINRA) recently fined Raymond James & Associates and Raymond James Financial Services $17MM.  According to FINRA, the two firms failed to prevent, detect, investigate, and report suspicious activity for several years. Apparently, compliance officers and other individuals (partners, directors, officers or employees) can bear personal responsibility for failures to enforce Bank Secrecy Act/Anti Money Laundering standards; the AML Compliance Officer was also personally fined $25 thousand, and suspended for three years. Brad Bennett, FINRAs chief of enforcement, said: “This case demonstrates that when there are broad-based failures within specific areas of responsibility, we will seek individual liability where appropriate.”

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Read this article on the Yucatan Times.

Compliance front and center

Thomas Fox – Compliance Week – June 21, 2016

The past couple of months has confirmed a trend we have seen for some time in the world of Foreign Corrupt Practices Act and greater anti-corruption compliance. It is the continued growth in the importance of doing compliance in the eyes of the Justice Department and Securities and Exchange Commission. They have clearly moved beyond simply having a compliance program in place. It must be operationalized, and you must demonstrate its effectiveness if you want to receive credit for it in any FCPA enforcement action.

In April with the release of the written document, entitled “The Fraud Section’s Foreign Corrupt Practices Act Enforcement Plan and Guidance” and detailing the Pilot Program for FCPA enforcement credit, the Justice Department made clear that it is the doing of compliance that can bring a company “reducing credit.” It also made clear that the role of the chief compliance officer needs not only to be central to your compliance efforts but also central to your overall business operations.

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Read this article on Compliance Week.

Richard Bistrong: At Compliance Week 2016, Compliance 2.0 takes center stage

Richard Bistrong – The FCPA Blog – May 31, 2016

When prosecutors, regulators, and compliance practitioners agree on anything, I pay special attention.

Last week,  Compliance Week 2016 opened with a panel of Stephen Cohen, Associate Director of the SEC Division of Enforcement and Andrew Weissmann, Chief of Fraud Section of the DOJ Criminal Division. Their topic: “Are We Defining Effectiveness Correctly?”

Cohen and Weissmann were clear about the importance of the independence of the compliance function. The issue of reporting relationships, from their perspective, wasn’t as significant as the weight of compliance being able to voice disagreement, deal with conflict, and integrating into the business.

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Read this article on The FCPA Blog.

The Evolution of Compliance: Structural Changes Which Led to Compliance 2.0

Thomas Fox – FCPA Compliance Report – May 26, 2016

If there was one theme from Compliance Week 2016 it was the continued evolution of the Chief Compliance Officer (CCO) role and the compliance profession. Long gone are the days when someone is sent over from a legal department into the compliance department or worse, some lawyer who is just given the title of CCO and this is considered to be a best practice or even sufficient. In the opening keynote presentation, representatives from the Department of Justice (DOJ) and Securities and Exchange Commission (SEC) made clear they expect a CCO to know more than simply the laws of anti-corruption, they must actually work to do compliance in an organization. A key metric of doing compliance is the independence of the CCO and compliance function.

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Read this article on the FCPA Compliance Report.

Defining Compliance 2.0: the board (part 1 of 5)

Michael Volkov – Corruption, Crime & Compliance – November 29, 2015

If you read through compliance writings, blogs, articles, white papers, and other sources, you will see the term “Compliance 2.0” bandied about.  It is a term that has yet to be defined but is taking on a life of its own – a reflection perhaps of the growing and continuing momentum behind the ethics and compliance function.

This series is an attempt to put some meat on the bones (yes, just after Thanksgiving) and advance the discussion around the new model for ethics and compliance.

In the last three years, compliance has been at a “standstill” in terms of defining the elements of an effective ethics and compliance program. The Justice Department and SEC’s FCPA Guidance was a watershed event in defining an effective ethics and compliance program, along with the UK Bribery Act’s adequate procedures, and continuing work from the OECD and other non-profit organizations. But in the end, it was DOJ and the SEC that have moved the compliance function to a new era, fueled by aggressive enforcement actions and political pressure to provide guidance to the business community.

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Read the article on Corruption, Crime & Compliance.