Compliance Insider

Issue 11 > Compliance Alerts

Wall Street systematically silences whistleblowers

Companies on Wall Street are systematically undermining the Securities and Exchange Commission (SEC) by silencing whistleblowers. As the SEC seeks to strengthen the Dodd Frank whistleblowing provisions, companies are intentionally doing the opposite.

Issue 11 > Compliance Alerts

Third party provides expired meat in China

A number of recognisable brands have been embroiled in a food scandal in China as unhygienic standards were found in a third party chicken supplier.

Issue 11 > Compliance Alerts

British companies ignorant of supply chain sources

British companies have poor knowledge of their supply chains and are not set to change their ways despite previous scandals and slavery risks. The Chartered Institute of Purchasing and Supply (CIPS) conducted a survey to which almost three quarters of supply chain professionals admitted to having zero visibility of their supply chain.

Issue 11 > Compliance Alerts

SEC investigates insider trading

United States' Securities and Exchange Commission (SEC) is investigating four dozen hedge funds, asset managers and other investment companies to determine whether or not they partook in insider trading. Suspicious trends emerged as companies bought health-insurance stocks in April 2013 ahead of a government announcement that benefited the insurance firms.

Issue 11 > Compliance Alerts

Swiss bank probed for wooing Gadhafi

United States and United Kingdom authorities have opened a probe into a Swiss bank amid suspicions that it bribed Gadhafi's government in a variety of ways. Tradition Finance Services of Switzerland is accused of employing relatives of Gadhafi's government, paying for luxury travel expenses and funding days by the poolside and nights partying, all in an attempt to obtain business from the Libyan government.

Issue 11 > Compliance Alerts

TV anchor arrests as China's crackdown continues

A television anchor for China's state run China Central Television (CCTV) has been detained as the Government's anti-corruption campaign widens. The host of financial programmes on CCTV Rui Chenggang was arrested prosecutors on Friday evening. CCTV's vice-director for financial news Li Yong was also detained.

Issue 11 > Compliance Alerts

DNA probes German company for bribing Romanian officials

The National Anti-corruption Directorate has opened a probe against German company EADS Deutschland GmbH as large amounts of money allegedly were given as bribes in exchange for a contract worth 534 million Euros.

Issue 11 > Spotlights

Making compliance the core of your organisation's culture

In many companies, being a member of a compliance team is a tough role. There are a lot of preconceptions about compliance and many business executives still see the function as a checking, validation and audit body that does not understand the business and its needs.

Issue 11 > Research

Statistics on compliance: HR and Compliance

A company’s HR function can play a key strategic role in developing and nurturing an effective compliance programme; however, it requires a successful partnership with the compliance function over areas such as communication, training and identifying priorities. Our recent Compliance and HR survey provides a useful snapshot of the current engagement between compliance and HR, enabling companies to compare and contrast their experiences with their peers.

Issue 11 > Due Diligence Handbook

Conflict minerals – policy development, questionnaire implementation and subsequent analysis

The 2 June 2014 Securities and Exchange Commission (SEC)–mandated deadline for conflict minerals disclosures has seen organisations across the globe make the obligatory investments to determine if their products and supply chains contain conflict minerals. Even with periodic guidance offered by the SEC and assistance available from third party experts, companies still face the continuing challenges of complying with conflict minerals laws and determining whether covered minerals are sourced through their supply chains. This article simplifies the practical steps that organisations should consider when moving forward with conflict minerals compliance; steps which, if followed, will put your company on the right track to long-term compliance success.

Issue 11 > Country Focus

Corruption and conglomerates in South Korea

Often referred to as ‘the Miracle on the Han River’, the South Korean economy gets its nickname from its unexpected prowess given the country’s lack of natural resources, small landmass and over-population. But despite the booming economy, business culture in South Korea is marred by corruption issues. Although South Korea ranks 15th in the world by nominal GDP and is seventh out of 189 countries on the World Bank’s ease of doing business index, it ranks only 46th out of 177 countries on Transparency International’s Corruption Perceptions Index (CPI) of 2013. This places it behind countries such as Botswana and Bhutan; countries that are considered less developed and less economically proficient.

Issue 10 > Compliance Alerts

DOJ and SEC prosecutions increase as individuals targeted

The United States Securities and Exchange Commission (SEC) and Department of Justice (DOJ) are set to surpass recent record case numbers this year as they target individuals.

Issue 10 > Compliance Alerts

FIFA's third party hospitality leader arrested for ticket sales

The head of FIFA's hospitality provider has been arrested by Rio state police, which has accused him of aiding ticket scalpers who illegally resold World Cup tickets worth an estimated US$100 million. The head of Zurich-based Match Hospitality AG Raymond Whelan was detained and his passport confiscated so he could not leave the country. His company was appointed by FIFA to sell hospitality packages for all World Cup games.

Issue 10 > Compliance Alerts

Recaptured Indonesian businessman jailed for bribing minister

Indonesian businessman Anggoro Widjojo was given a five-year prison sentence by the Jakarta Corruption Court last week for bribing former forestry minister MS Kaban, among others, in order to secure a Rp180 billion (US$15 million) project in 2007. The sentence is the maximum that the panel of judges could rule under Article 5 of Indonesia’s 2001 Corruption Law, which sets out the penalties for those convicted of bribing state officials.

Issue 10 > Compliance Alerts

Former French President under investigation

France’s former President Nicolas Sarkozy has been placed under investigation by an anti-corruption court on allegations of influence peddling in a case involving himself, his lawyer and a judge. Although Sarkozy vehemently denies the allegations, calling them politically motivated, they are just the latest in a series of scandals that could curtail any ambitions for a political comeback.

Issue 10 > Compliance Alerts

Red Bull settles Cuban sanctions violations

Energy drink maker Red Bull North America has settled a potential civil liability suit for alleged violations of United States sanctions against Cuba. According to the United States Treasury Department, the firm has agreed to pay US$89,775 for failing to secure authorisation from the Treasury to film a documentary in the country in 2009.

Issue 10 > Compliance Alerts

Chinese misconduct report reveals taste for wine

China’s National Audit Office has uncovered and revealed a series of abuses and misconduct in its annual report to China’s parliament. The revelations, which include the acquisition of 14 wineries in France with funds set aside for technology acquisitions, come amid President Xi Jinping’s purge on corruption.

Issue 10 > Compliance Alerts

Japan the latest addition to BVI transparency initiative

The Government of the British Virgin Islands (BVI) has deepened its commercial footprint in Asia by signing a Tax Information Exchange Agreement (TIEA) with the Government of Japan. The TIEA is the 26th signed by the BVI and enables the two governments to have greater ability to exchange information for tax purposes.

Issue 10 > Compliance Alerts

Barrick Gold protests innocence to bribery accusations

African Barrick Gold has been accused of paying more than US$400,000 in bribes to government officials in Tanzania. Although the company and Toronto-based parent Barrick Gold insist the payments were legitimate to cover expenses and allowances, an anonymous source has asserted they were bribes but was not clear on what was expected in return.

Issue 10 > Compliance Alerts

Bribery scandal undermines foreign investment initiative

Giorgio Orsoni has resigned as mayor of Venice following his recent arrest in connection with a bribery scandal linked to the €5 billion Mose flood barrier project. Although released from house arrest after agreeing to a four-month sentence and a €15,000 fine in a plea bargain, Orsoni denied accepting bribes.

Issue 10 > Compliance Alerts

Carrefour reacts to supply chain investigation

French supermarket group Carrefour has suspended its business with Thai company Charoen Pokphand (CP) Foods following an investigation by the UK’s Guardian newspaper that revealed the presence of slavery in the supply chain.

Issue 10 > Compliance Alerts

Study proves shareholder deceit harms company value

A study on Foreign Corrupt Practices Act (FCPA) enforcement has shown that companies that engage in financial fraud, with the intention of deceiving shareholders, suffer considerably larger drops in market capitalisation than those simply charged with bribery.

Issue 10 > Compliance Alerts

Kremlin associates profit from overpriced scanners and other state contracts

Two wealthy associates of Russian President Vladimir Putin escaped a series of convictions and prison sentences in 2012 for the over-charging to hospitals of high-tech medical scanners.