Welcome to the first day of a five-day podcast series Jay Rosen and I are producing in honor of the latest Star Wars movie The Last Jedi. Each day over this week, Jay and I will review a Star Wars movie and discuss it from the compliance perspective. Today, we consider Episode IV, A New Hope and risk.

The full series schedule is:

Monday, December 18, Part I- IV-a New Hope and risk.

Tuesday, December 19, Part II- V-The Empire Strikes Back and due diligence.

Wednesday, December 20, Part III- VI-Return of the Jedi and effective training.

Thursday, December 21, Part IV- VII-The Force Awakens and disruptive innovation in compliance.

Friday, December 22, Part V-Rogue One and the myth of the rogue employee.

One of the plotlines is that the Galactic Empire has created a Death Star with enough firepower to destroy a planet. The Rebel Alliance is determined to destroy the Death Star and has blueprints detailing the defensive posture of the Death Star. A computer analysis determines a weakness in the Death Star’s defensive shield. At one point, the Death Star’s commander, Grand Moff Tarkin, played by Peter Cushing, is told there is a ‘risk’ in the Rebel’s plan of attack. Tarkin dismisses this risk as insignificant. Of course, Luke Skywalker then proceeds to exploit this risk and destroy the Death Star.

Tarkin’s incorrect assessment of this risk was lethal. Today I want this part of the story to introduce the subject of how you evaluate compliance risk under the Foreign Corrupt Practices Act (FCPA) or an economic sanctions regime. Failure to appreciate risk can lead to some very serious and perhaps lethal consequences.

Whether you utilize one approach or another, analyzing the results of your risk assessment is as important as doing the risk assessment. With the recent Department of Justice (DOJ) remarks around how they will review the effectiveness of compliance programs during an enforcement action to determine potential credit or even granting a declination, the stakes have never been higher. Of course, for Grand Moff Tarkin, his refusal to analyze the risk assessment presented to him was fatal.

Join us tomorrow where we consider The Empire Strikes Back and due diligence.

May the podcast be with you this holiday season.

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