In the Spring of 2012 I published a five-part series of on-line articles through Corporate Compliance Insights under the heading of “Incorporating the Fraud Triangle into Compliance Risk Assessments.” While those articles were publicly available, I understand they received a fair degree of attention and were quoted and/or cited by numerous persons doing white-papers or articles where this information was relevant. A friend in the compliance profession recently told me that this series of articles was no longer available publicly/online and asked if I might consider updating/revising that work into one complete article and putting it back out into the public domain – here it is.
It is with great pleasure that I may announce the launching of the website for International Association of Independent Corporate Monitors (IAICM). A not-for-profit Membership Organization established in 2015 and headquartered in Virginia, in the greater Washington DC area, IAICM is an organization of professionals dedicated to educating the public on the topic of Independent Corporate Monitors (“Monitors”) and advancing the use and quality of service of those individuals serving or seeking to serve as Monitors.
The purposes of IAICM are to promote and improve the professional practice of Corporate Monitoring, to be a recognized thought-leader in the field of Corporate Monitoring, to make available information on Corporate Monitoring to the public, and to provide high quality, relevant information, resources and training to professionals and others practicing in the area of Corporate Monitoring.
IAICM’s Code of Professional Conduct is an invaluable resource for standards and best practices for those serving or seeking to serve as a Monitor. Indirectly, the Code also suggests best practices for Reporting Agencies and Host Organizations considering or using Monitors. All Members of IAICM must certify that they will abide by and uphold the IAICM Code, providing both a guide and a performance measuring stick for Host Organizations, Reporting Agencies, and the public-at-large.
The mysteriousness of Corporate Monitoring is enhanced by the difficulty in obtaining information on the topic. A person studying Corporate Monitoring not only must collect information from a wide variety of sources, but may also have great difficulty identifying reliable and relevant sources.
IAICM’s Public Resource Center helps address this by making available to the public the only repository of information on Corporate Monitoring. From key government policy documents to actual Agreements requiring Monitors, the Public Resource Center makes them easy to search and find. Interested in identifying all known Monitorships by a particular agency, underlying misconduct, or during a particular time frame? Our search engine helps visitors not only identify these in our repository, but presents, in one easy-to-read screen, the relevant information and supporting documents for each matter in our repository.
All IAICM Members have qualifications that suggest they possess the breadth and depth of relevant skills, knowledge, and experience, together with reputation of character, to effectively serve as an Independent Corporate Monitor consistent with IAICM’s Code of Professional Conduct. To facilitate the needs of those considering candidates for a Monitorship, finding a speaker on the topic, seeking guidance, or simply doing research, all IAICM Members are publicly listed on this site, along with each Member’s relevant contact and professional information.
In November of 2014, I published a paper entitled “Improving Corporate Settlement Agreements” on JDSupra. A few media people and industry experts picked it up and made comments on it – all the ones that I read were positive (thanks guys!).
In that paper, one of the issues that I raised was the lack of compliance and ethics program expertise among government agencies in the field of compliance and ethics programs. For example, while DOJ prosecutors are exceptionally knowledgeable, trained, and experienced in white collar crime matters, I know of very few who can say the same about corporate compliance and ethics programs. Yet it is exactly the robustness and effectiveness of an organization’s compliance and ethics program that dictates if or how the organization will emerge – prosecution, suspension/debarment, settlement, etc….
I would love to say that some DOJ people read that paper and took it to heart, but that’s probably doubtful. Nonetheless, I was thrilled when I saw the announcement that the DOJ FCPA Unit was bringing on a compliance and ethics expert to do exactly what I was saying needs to be done in that regard (I had other criticisms in my paper as well that I would love to see addressed).
It has been reported that in July 2015, the Chief of the Fraud Section at DOJ confirmed that this position/role was being filled. Here’s a link to an article on it. The article stated: “This new compliance counsel position constitutes a significant change for DOJ, which in the past has relied on its cadre of white collar criminal prosecutors to evaluate compliance programs. The compliance counsel will help DOJ answer the recurring issue of whether an FCPA violation occurred because the company lacked an effective anti-corruption compliance program or because a rogue employee circumvented an otherwise strong program. Should DOJ decide to prosecute the company, the compliance counsel’s evaluation of the company’s compliance program will inform the final resolution with the company, including whether the company will be required to retain an independent compliance monitor.”
Kudos to the DOJ FCPA Unit for recognizing this need and doing something about it. I and many others in the field will be anxiously awaiting to see it in action. I also hope we will see this in other DOJ units (e.g. Anti-Trust) – this isn’t just an FCPA issue!
Also, I have seen some non-DOJ units picking up on this need. For example, key decision makers in the Department of Interior’s Office of Inspector General and Suspension & Debarment Offices have become Certified Compliance and Ethics Professionals through the Society of Corporate Compliance and Ethics. I have heard that the same is happening in at least one other Agency’s OIG and S&D offices.
There’s a long road ahead, but it seems people are at least seeing that a road exists.
I was interviewed earlier this year for this third part in a series of articles by Thomson Reuters on DPAs. If you would like to read it, click here or you can download a pdf copy that Thomson Reuters provided to me: Thomson Reuters Article on DPAs Part 3 – 13Apr2015
I was recently interviewed by Morning Consult for a series of articles regarding deferred and non-prosecution agreements and wanted to share those here for anyone interested. They are linked below (hopefully these links remain “live” for some time).
There was an awful lot of outrage about the Nationwide commercial drawing attention to home accidents affecting children during the Superbowl this year. It didn’t seem that the outrage was so much directed at the message as much as it was the timing – it was done during a time when people were trying to be entertained, not horrified.
I have four young daughters, so I get that anything that makes me think about their mortality (much less my delinquency or negligence contributing to something that harms them) causes a certain amount of discomfort. A lot of discomfort. But I was with my family watching the game when this commercial aired and I have to say, though it certainly put a temporary damper on our festive spirits, it also caused a moment of reflection. I had forgotten about securing a television set in our home that could fall if one of my kids climbed on it (such a scene was in the commercial).
So I am supposed to be angered that I suffered a brief interruption of my precious and fleeting television entertainment-induced happiness to be reminded that I needed to do something the consequences of which could cause a constant interruption of my happiness for the rest of my life?
When exactly is the time for delivering messages that draw our attention to risks? The argument that this commercial was poorly timed because it interfered with our entertainment is, in my mind, absurd. Television is predominately for entertainment. Therefore, there could be no appropriate time for a commercial like this. Perhaps there are some shows that cater to the melancholic, where “depressing” commercials might resonate better?
The idea behind heightening awareness of risks is to draw the largest amount of attention possible to those risks. In the case of this message, using a Superbowl commercial was sure to reach a heck of a lot more people than some educational/informational show that airs in the middle of the night watched by a couple hundred people.
The public uproar stimulated questions relevant to my professional compliance and consulting work – Are we living in a culture that has no appreciation for hearing about and taking actions to mitigate risks? A culture that actually takes offense when we do?
In business, we need to appreciate, understand and act on risks. Yet compliance and ethics professionals face similar challenges with Boards, Executives, Senior Management and even line employees and/or agents of an organization. Though there is an expectation that these roles know about and deal with risks, it’s not something they particularly care to hear about, particularly in the higher ranks, where it is of great importance and impact. They prefer to discuss financial results, stock performance, mergers & acquisitions, etc. – you know, the REAL and IMPORTANT stuff.
I face a similar challenge when trying to develop proactive compliance and ethics consulting work. Organizations simply don’t want to hear about faint, non-imminent, and “philosophical” dangers that could sink or significantly impair their organization. Much less do they want to spend a little money to properly deal with it.
Using the Nationwide commercial as an analogy, one might think the risk of an unsecured weapon in the home is minimal because one’s children have been well educated on the risks and, due to their obedience, would not play with the weapon. Perhaps true. But what about the kids who come over to play?
The rationalizations in business are really no different. I can’t tell you how often I heard victims of a fraud (both when I was an FBI Agent and now as a consultant) tell me something like “But Sally was such a nice and religious lady whose been with us for 15 years – she COULDN’T have stolen from us! You must have made a mistake.”
To all the compliance and ethics professionals out there working hard to do the right thing, whose risk messages too often fall on deaf ears, I raise my coffee cup to you. You ever need an ear, my number ain’t hard to find.
If you were wondering whether or not I had dropped off the face of the earth for the last six weeks, you guessed right. October of 2014 was a month that, along with September 2001, I would love to utterly erase from my memory.
My mother, who had been so courageously battling cancer for the last five years, lost the battle on October 17, 2014. Despite a contractor catching my house on fire and a kidney stone suddenly showing up, I was able to get to Bristol, VA and be with my mom before her passing. I remained in Bristol to support my dad and help with all of the funeral arrangements. After the funeral, I packed their house up and moved dad up to Fredericksburg, VA with my family.
As I reflected on my mom’s life and lessons, there were a few in particular that I find relevant to the work I do today, particularly in the area of compliance and ethics. My mom was raised in a second generation Italian family in extreme poverty in New Orleans. I recall hearing stories of how she slept together with her sister and brother in a small room where they had to take turns staying awake to keep the rats off of them.
Despite the obstacles, mom appreciated the value of hard & honest work, education, and selfless service. Working various jobs, she put herself through nursing school and began what became a forty-one year long career as a nurse. Mom’s nursing accomplishments were of no comparison with Nobel Prize winners and will never be remembered outside of the small circles of those whom they affected, but they are nonetheless as profound and meaningful, both to those affected and to those who might see in her life and work the impact and role of a positive high ethical tone and commitment to always doing what was right and in the best interests of her “customers” – her patients.
My mom always stressed the importance of honesty and showed me the benefits of it every time I owned up to something I did wrong as a child. As long as I was honest about my mistakes, the punishment was appropriately reduced. Thank God – or I would still be in “time-out” some forty years later! That is a lesson I have carried all my life and am trying hard to pass on to my children, as well as those with whom I work.
Positive ethical tone within an organization begins with honesty. And ends with dishonesty.
An effective compliance & ethics program will include on-going education and training. While my mom worked hard to put herself through school to become a nurse, she never stopped her education there. Over the course of her career as a nurse, she took on many new challenges/specialties, some of which she did pioneering work in. The lesson is that education never stops. We never stop learning and we always have room to learn more, regardless of where we are now in our lives and careers. Compliance training IS on-going education. It is not checking a box.
Being a nurse is among the most altruistic jobs one might have. Caring for those who, in many instances, can’t care for themselves. Helping them with the most humbling and/or simple tasks – many tasks that even family might shy away from. Not losing sight of their human dignity and treating them with respect, even as they lost respect for themselves. My mom was always a champion of the patients, even when being so was not always in the financial best interests of the hospital or kindly looked upon by her superiors. As best as I know, mom never had to deal with any “corporate” fraud issues as a nurse/employee, but she certainly had her share of ethical issues. Sometimes described as a “firecracker” when it came to advocating for her patients, I am sure mom upset her share of hospital superiors of lesser ethical constitution over the years.
It’s a great lesson for us. By placing greater value on what we do and doing things right (rather than on where our stock price is), we find a more fulfilling and long-lasting success. When someone acts unethically or engages in some sort of misconduct, we have to speak up – until somebody listens.
I recall with both joy and sadness a little boy named Stephen, who was a cancer patient under my mom’s care in a pediatric intensive care unit. I was living far away at the time, working as an FBI Agent. In caring for Stephen, my mom had learned that he had dreamed of one day becoming an FBI Agent and so she asked that I might visit him when I next came to town – in fact, she made certain to remind me of it MANY times as I planned my next visit!
When I got to town, my mom made sure that the hospital was my very first stop. She also insisted that I wear a suit – my official FBI Agent “uniform.” After Stephen’s chemo treatment(s) that day, she rolled him in a wheelchair to a private little waiting area where she had asked me to wait. Stephen was probably about ten years old and his cancer was terminal – in its latest stage. It was obvious that this child had suffered much and long, and was still in pain. He didn’t have a single hair on his head and maybe weighed forty pounds in all his clothes. Yet when my mom introduced me as her FBI Agent son, he lit up like a Christmas tree. My mom and Stephen’s mom left briefly, so that we could have our “top secret debriefing.” I let him hold by badge and credentials, let him see my handcuffs and the gun holstered on my hip, and answered every question he could muster the strength to ask – and many that I knew he would ask if he could.
When our time was over, I gave Stephen an official FBI t-shirt, a junior FBI Agent badge, some FBI pens, and other little things that I can’t even remember – though they meant the world to him. I learned a couple months later that Stephen had passed and that he had specifically requested that he be buried in that FBI t-shirt that I gave him. To this day I can’t think about that without tearing up.
This is just one example of how my mom took the time to listen to her “customers” and to appropriately do more for them than what just her job required. She got no honors, medals, promotions, mentions or bonuses for this – and that was fine by her. The joy brought to Stephen was priceless.
I’ll miss you mom. Thanks for all you did for me and for everyone you touched. I hope I can pass on the lessons I learned from you to my children as well as you passed them on to me. I also hope that I might follow your example(s) with the same humble obscurity as you sought and that I might touch just one tenth of the number of lives that you did.
Tell Stephen hello for me.