International - Written by on Wednesday, July 23, 2014 12:20 - 0 Comments

Compliance Policy. Check. Training Check. Job Done? Not so much.

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Poor evaluationMany companies do not enforce policies and it is the failure of management and leadership to take them seriously.  Time and time again I get the impression they don’t care so much if third parties are paying bribes and that they tend to look the other way.

Many companies take position if I don’t know about it I’m not responsible for it and will not probe too deeply.  But that attitude catches up.  In the real world the sales executive knows exactly what is going on.

It is hard to keep your self in dark without opening up liability to wilful blindness.

said Jeff Knox, Fraud Chief of the DoJ at the recent C5 8th Annual Conference in London.

Under the FCPA, a person’s state of mind is “knowing” with respect to conduct, a circumstance, or a result if the person: is aware that [he] is engaging in such conduct, that such circumstance exists, or that such result is substantially certain to occur; or has a firm belief that such circumstance exists or that such result is substantially certain to occur.  Thus, a person has the requisite knowledge when he is aware of a high probability of the existence of such circumstance, unless the person actually believes that such circum- stance does not exist.

Under the Bribery Act, if a violation of bribing, receiving a bribe or bribing a foreign public official is committed under the Bribery Act by a company then Section 14 of the Bribery Act provides that if the offence is proved to have been committed with the consent or connivance of—

(a) a senior officer of the body corporate, or

(b) a person purporting to act in such a capacity, the senior officer or person (as well as the body corporate or partnership) is guilty of the offence and liable to be proceeded against and punished accordingly.

Connivance is frequently referred to as turning a blind eye and UK prosecutors will come at it from a similar standpoint as Mr. Knox.

In the US congress made clear, it meant to impose liability not only on those with actual knowledge of wrongdoing, but also on those who purposefully avoid actual knowledge:

[T]he so-called “head-in-the-sand” problem—variously described in the pertinent authorities as “conscious disregard,” “willful blindness” or “deliberate ignorance”—should be covered so that management officials could not take refuge from the Act’s prohi- bitions by their unwarranted obliviousness to any action (or inaction), language or other “signaling de- vice” that should reasonably alert them of the “high probability” of an FCPA violation.

The problem

Regulators and prosecutors on both sides of the Atlantic may misconstrue underfunded compliance programs, poor implementation of systems and controls and little training as equating to senior management with a devil may care approach and turning a blind eye.

Some sweaty interviews and potential prosecution come shortly after that impression is created.

The Solution

Is easy.

 

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