Financial Regulatory Forum

Corporate investigations are getting riskier and more difficult, experts say

By Stuart Gittleman

NEW YORK, May 29 (Thomson Reuters Accelus) - U.S. corporate officers and directors are increasingly concerned over the business and legal challenges their entities face from potential securities enforcement and criminal probes, lawyers and corporate officers are saying.

A program last week analyzed how directors, executives and corporate counsel can appropriately manage the business and legal risks of an enforcement proceeding arising from earnings misstatements or employee misconduct at both low and high levels.  (more…)

Wal-Mart bribery scandal seen undermining effort to soften U.S. anti-corruption statute

By Brett Wolf

ST. LOUIS, May 2 (Thomson Reuters Accelus) – News that Wal-Mart may have tried to cover up bribes paid by its Mexico unit will make it difficult for Congress to weaken an anti-bribery statute loathed by the U.S. business community, at least in the short term, sources say.

“My conclusion is that the Wal-Mart article makes it impossible to change the Foreign Corrupt Practices Act at the moment,” said Peter Henning, a professor at Wayne State University Law School. (more…)

COLUMN – UK Bribery Act guidelines: has the lobbying worked?

By Helen Parry,   senior regulatory intelligence expert, Complinet. The views expressed are her own.

LONDON, April 5 (Complinet) - Seemingly unnerved at the anti- Bribery Act lobby’s dire predictions of British corporations losing out to competitors hailing from jurisdictions with a more relaxed approach to such matters, the Ministry of Justice appears to have taken heed. This is clearly demonstrated by the reassuring, empathetic and positively emollient tone employed in the revised version of the guidance for companies issued last week, particularly when sensitive issues such as facilitation payments and corporate hospitality are being addressed. This change of heart can be clearly discerned by comparing the original and revised versions of the case study on facilitation payments featured in the guidance documents.

THE ORIGINAL CASE STUDY

The original version posited a UK company engaging with a US counterpart in a consortium which was contracting in a third country jurisdiction “rife with corruption.” They were already in serious trouble, having made facilitation payments, struck a deal with union leaders, replaced the facilitation payments with IT services to educational centres connected to an opposition party and been accused of bribery by an overseas government.

ANALYSIS-Companies could get caught in Asia as corruption rules tighten

By Rachel Armstrong

SINGAPORE, Jan 20 (Reuters) – Multinational firms trying to get a bigger piece of the Asia growth story face a rising risk of becoming embroiled in corruption scandals unless they enforce stricter compliance norms and new regulations.

The region may have moved centre stage in many companies’ growth strategies as developed economies struggle but firms are also scrutinising investment projects even more and stepping up due diligence before jumping into new joint ventures and M&A. (more…)

ANALYSIS-Cocktails and wiretaps signal new anti-bribery era

By Dan Margolies

WASHINGTON, April 5 (Reuters) – When 17 employees of a dozen or so small and mid-size companies gathered for a cocktail reception last year at Clyde’s restaurant in Washington, D.C., they toasted what they thought was the imminent completion of a $15 million arms deal to outfit the presidential guard of an African country.

Unbeknownst to them, FBI agents were secretly videotaping the meeting. To nail down the deal, the employees had allegedly agreed to pay 20 percent “commissions” to a sales agent they thought represented the African country’s defense minister. The sales agent turned out to be an undercover FBI agent.

The mid- and senior-level managers were among 21 individuals arrested on Jan. 17 at a shooting and hunting trade show in Las Vegas, where they had gathered to meet the mythical defense minister. Simultaneously, 150 FBI agents fanned out across the country to execute search warrants at the employees’ companies.

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