As the Houston Texans head to Boston for the NFL Season Opener and the Houston Astros head to Boston for a preview of the ALCS , Tom and Jay are back with a look at some of the week’s top compliance and ethics stories.

  1. Big pharma member Sanofi settles FCPA violations with $25MM penalty. Dick Cassin reports in the FCPA Blog. Sam Rubenfeld reports in the WSJ Risk and Compliance Journal.
  2. SEC lays out two large whistleblower awards. Matt Kelly details it on Radical Compliance. See SEC Press Release. See full SEC Order.
  3. Do you have a whistleblower triage system? Jonathan Marks explains what it is and why you need it on his Board and Fraud
  4. Three former senior executives from Telia, including the former CEO, go on trial in Sweden for paying bribes in Uzbekistan. See report in RadioFreeEurope.
  5. More thoughts and reactions on Hoskins. Matthew Stephenson weighs in on the Global AntiCorruption Blog. Jon Rusch explores what the decision did and didn’t say in Dipping Through Geometries. I explore on the FCPA Compliance Report with former DOJer Laura Perkins (releases Monday, Sept. 10)
  6. ING settles money-laundering violations with Dutch authorities for $900 million. SEC issues anti-piling on declination. Jaclyn Jaeger on the settlement in Compliance Week (sub req’d). Harry Cassin on the SEC declination in the FCPA Blog.
  7. UK High Court restores attorney/client privilege in internal investigations. See Gibson Dunn client alert. See full Court Opinion here.
  8. Anonymous reporting is viewed as critical in the world of anti-corruption compliance. What about in the world of politics? Tom, Jay and Matt debate the anonymous NYT Op-Ed piece detailing the insanity in the White House.
  9. Want the top compliance training from the guy who wrote the book on compliance? Tom will put on a Compliance Master Class in Boston, September 25 & 26, hosted by Affiliated Monitors. Registration and information, click here.
  10. Want a 50% discount to one of the top compliance conferences around? Join Tom and AMI’s Eric Feldman at CONVERGE18 in Denver on October 9-11. I hope you can join me at the event. For information on the event, click here. As an extra benefit to fans of This Week in FCPA, CONVERGE18 is offering a 50% discount off the registration Enter discount code TOMFOXVIP.
  11. The Astros magic number is 19 (Jay is far too traumatized to put one on the Red Sox) as they head up to Fenway Park for a three-game series which is a preview of the ALCS. In other news, the Texans head to Foxborough to continue their 0 for Brady streak.

For more information on how an independent monitor can help improve your company’s ethics and compliance program, visit our sponsor Affiliated Monitors at www.affiliatedmonitors.com.

Welcome to Everything Compliance, the only roundtable podcast in compliance. Inspired by our UK colleague, Jonathan Armstrong who inquired if we could explore the guilty plea of Michael Cohen and the guilty verdict against Paul Manafort, we dedicate the next two episodes to issues surrounding, raised by or related to these two events. In this episode we have Mike Volkov and Matt Kelly. Next week Jay Rosen and Jonathan Armstrong. After the commentary we follow with rants.

  1. Mike Volkov-from Cohen an explanation of how prosecutors build cases with witness flipping. From the Manafort trial, how do prosecutors use documents to tell a credible story when the prime prosecution witness is a slime ball like Rick Gates. Mike rants the absence of any class at the White House in their treatment of the death of John McCain.
  1. Matt Kelly-Trump has attacked Cohen for being a ‘rat’ and praised Manafort for keeping his mouth shut. Can you use this as an opening to explore what such a diatribe might mean for corporate whistleblowing, particularly in view of the new proposed SEC whistleblower rules. Matt rants against the scooter-share company Bird, which is invading and the retreating from communities without approval, apologies or so much as a by-your-leave.

The members of the Everything Compliance panelist are:

  • Jay Rosen– Jay is Vice President, Business Development Corporate Monitoring at Affiliated Monitors. Rosen can be reached at JRosen@affiliatedmonitors.com
  • Mike Volkov– One of the top FCPA commentators and practitioners around and the Chief Executive Officer of The Volkov Law Group, LLC. Volkov can be reached at mvolkov@volkovlawgroup.com.
  • Matt Kelly– Founder and CEO of Radical Compliance. Kelly can be reached at mkelly@radicalcompliance.com
  • Jonathan Armstrong– Rounding out the panel is our UK colleague, who is an experienced lawyer with Cordery in London. Armstrong can be reached at armstrong@corderycompliance.com

The host and producer (and sometime panelist) of Everything Compliance is Tom Fox the Compliance Evangelist.

You can put away your all white linen suits and your seersucker suits as well. With that hint of fall in the air, we are upon the (unofficial) end of summer with the Labor Day Weekend, Tom and Jay are back with a look at some of the week’s top compliance and ethics stories.

  1. Second Circuit affirms most of Hoskins dismissal. Dick Cassin reports in the FCPA Blog.
  2. With a nod to Dwight Eisenhower, Hui Chen says compliance is about process not outcomes. Check out her article in Bloomberg.
  3. The 1MDB scandal only gets weirder. First Malaysian spies are linked to the scandal, Dick Cassin writes in the FCPA Blog. Next it turns out Chris Christie is representing Jho Low on a forfeiture case. Bradley Hope, Tom Wright and Rebecca Davis O’Brien report in the Wall Street Journal.
  4. Legg Mason bookends it NPA with a settlement with the SEC on its FCPA violations in Libya. Jack Hagel reports in the WSJ Risk and Compliance Journal. Tom reports in a tribute to Ed King on the FCPA Compliance and Ethics Blog. Dick Cassin reports in the FCPA Blog.
  5. Jaclyn Jaeger details some of the lessons learned from the Wynn scandal in Compliance Week. (sub req’d)
  6. Why is it important for integrity to a part of your brand. Nelson Pratt explains on Navex’s blog, Ethics and Compliance Matters. Tom tackles integrity in a tribute to John McCain on the FCPA Compliance and Ethics Blog.
  7. Does power corrupt or simply change you? Caterina Bullgarella explains why you must pay attention in a piece on Forbes.com.
  8. Microsoft in trouble for its distributor network? Dick Cassin reports in the FCPA Blog. Tom details how to manage the distributor risk in Compliance Week. (sub req’d)
  9. Now former Cleveland Browns linebacker Mychal Kendricks indicted for insider trading. Tom Schad reports in USA Today. Once again demonstrating why they are the worst run organization in all of pro football, Browns only find out about the facts after then indictment and then cut him.Reported by Charlotte Carrol in Sports Illustrated.
  10. On this week’s featured podcast series, Tom explored the interestion of King Arthur and compliance. In Part 1 it was Arthuian leadership. In Part 2 it was the Pentecostal Oath and a Code of Conduct. In Part 3 it was the Round Table and whistleblowing. In Part 4 it was the Green Knight and whistleblower protection. In Part 5 it was the quest for the Holy Grail and a compliance defense for the FCPA.
  11. As the play off race begins to take shape, Astros lead the West by 2.5 games after taking 2 of 3 from the A’s in Houston. After being swept by the Rays, the Sox take it out on the Marlins and their lead is back to 7.5 games over the Yankees.
  12. The Compliance Master Class is coming to Boston on September 25 & 26. Learn how to create, design and implement a best practice compliance program from Tom Fox, the Compliance Evangelist. For information, click here. For registration click here.

 

For more information on how an independent monitor can help improve your company’s ethics and compliance program, visit our sponsor Affiliated Monitors at www.affiliatedmonitors.com.

Yesterday, August 30th, was national Frankenstein Day. It is the unofficial holiday that celebrates the life and times of English author Mary Shelley who wrote one of the world’s most read monster novels, Frankenstein, or The Modern Prometheus. This year also marks the 200-year anniversary of the publication of the novel’s first edition. Due to the mores of the times, Mary Shelley was not listed as the author in the first edition but was listed as the author in subsequent editions.

The story of Shelley’s creation of the book is equally fantastic. During the rainy summer of 1816, Mary Wollstonecraft Godwin, aged 18, and her lover (and later husband) Percy Bysshe Shelley visited Lord Byron at the Villa Diodati by Lake Geneva in Switzerland. The weather was consistently too cold and dreary that summer to enjoy the outdoor holiday activities they had planned, so the group retired indoors until dawn.

Shelley later noted that sitting around a log fire at Byron’s villa, he proposed that they “each write a ghost story”. During one evening in the middle of summer, the discussions turned to the nature of the principle of life. Shelley came up with the idea that a corpse would be re-animated and from this sprang the story of Frankenstein.

While the book is much different from the movie, most people are more familiar with the movie. In it the good doctor, Victor Frankenstein becomes obsessed with this re-animation of life. He and his trusted servant Igor use electricity to bring back an executed prisoner to life. The re-animated man is known as “The Monster” and was played with great pathos by Boris Karloff. He was mute in the first movie but spoke in subsequent films. The Monster is mis-understood, then tormented to the point he strikes out the only way he knows, through violence. The most touching scene is his inadvertent drowning of a young girl Maria, with whom he is playing. The most horrific is his attack on Dr. Frankenstein’s wife on their wedding day.

Maria’s father arrives, carrying his daughter’s body. The villagers form a search party to capture the creature, determined to meet out revenge. They search for The Monster and during the search Dr. Frankenstein becomes separated from the group and is discovered by the creature, who attacks him. The Monster knocks Dr. Frankenstein unconscious and carries him off to an old mill and is thrown from the top by The Monster. Miraculously, Dr. Frankenstein’s fall is broken by the vanes of the windmill. The mob of villagers set the windmill ablaze, killing the entrapped Monster inside (at least until the sequel).

In honor of Frankenstein Day, I want to consider the leadership lessons of Dr. Victor Frankenstein or really the lack of leadership by the good doctor which led to the deaths of a small child, his brother and the rape of his wife-to-be on her wedding day. Of course it also led to the unleashing of his Monster, technically called Frankenstein’s Monster, upon the movie going world for years to come.

In a lecture at Indiana University’s Kelley School’s Business of Medicine, Dr. Richard Gunderman explored leadership lessons of Frankenstein. Gunderman began by asking, “What do we mean by leadership?” He went on to add, “That’s a question we’ll probably never bring to complete closure. Nor should we. Because it’s a question that each generation of future leaders needs to wrestle with for themselves.”

Gunderman asserted that leadership is fundamentally not an economic, commercial, or academic exercise, but is rather a moral exercise. He said, “Victor Frankenstein recoils in horror at what he’s created. That may be a powerful lesson for leaders. Leadership is a matter of morals, ethics, and human character. Who do you admire and what do you admire about that person? That’s the core of leadership.”

Gunderman went on to pose the question “In what sense are you responsible for what you create or cause to be created as a leader? How deep, how wide, and how far does your responsibility extend?” Gunderman had another interesting insight about this lack of love and empathy for his own creation by the doctor where he said it was “a cautionary tale for today’s leaders, as it weaves a narrative of “leadership gone bad”.” Gunderman then asked, “What if I said love is an essential element of great leadership?” You might respond as Gunderman did rhetorically “Would you say, “That’s absurd?”” But he then went on to note, “Mary Shelley invites us to take seriously the possibility that no amount of theoretical brilliance, technical know-how, or wizardry in the laboratory, can ever compensate or ever come to good with the absence of love.”

Gunderman concluded his remarks by noting, “Frankenstein was navigating by the wrong compass needle.” For Gunderman he challenged business leaders with the following, “When the chips are down, and light is fading, what do you look to (as the guide) to determine the direction that you ought to be proceeding?” He concluded by stating, “Victor Frankenstein realized too late that he had forgotten what most demands our loyalty. He was irresponsible. If the cost of preserving something is so high that we have to forget everything else, it’s not a price worth paying.”

I hope you will consider just how impactful you can be as a leader, such as a Chief Compliance Officer (CCO), or that your Chief Executive Officer (CEO) can be. Recall that Wells Fargo’s downfall started with a simple ditty “Eight is Great”  by the Bank’s President. That alone led to a marketing campaign where the Bank tried to sell (fraudulently or not) eight banking products or services to every customer and all employees were judged on this maxim.

You might also think about Mary Shelley on those dark nights on Lake Geneva. She gave us all a gift that still resonates 200 years later.

This publication contains general information only and is based on the experiences and research of the author. The author is not, by means of this publication, rendering business, legal advice, or other professional advice or services. This publication is not a substitute for such legal advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified legal advisor. The author, his affiliates, and related entities shall not be responsible for any loss sustained by any person or entity that relies on this publication. The Author gives his permission to link, post, distribute, or reference this article for any lawful purpose, provided attribution is made to the author. The author can be reached at tfox@tfoxlaw.com.

© Thomas R. Fox, 2018

In this episode, I chat with Erica Salmon Byrne, the EVP and Executive Director of Business Ethics Leadership Alliance for Ethisphere. We visit on Ethisphere’s 2018 World’s Most Ethical Company awards. Since 2007, Ethisphere has honored those companies who recognize their critical role to influence and drive positive change in the business community and societies around the world and work to maximize their impact wherever possible. The 2018 awards were no exceptions, with the designation going to 135 companies spanning 23 countries and 57 industries. We explore some of the following and much more. 

  1. How long has Ethisphere awarded WME?
  2. What is evaluated for WME? The five categories include: Ethics and Compliance Program, Corporate Citizenship and Responsibility, Culture of Ethics, Governance, Leadership, Innovation, and Reputation.
    3. What is the 3-year ethics premium?
  3. How does that compare with previous years?
  4. Did Ethisphere see any common or significant themes for WME 2018 companies?
  5. Company X is on the list. Problem Y is on the list. Why are they being honored?
  6. Description of the Ethisphere internal evaluation.
  7. How does WME literally set the standard benchmark for companies in the area of ethics and compliance?

To read the Ethisphere Research Report Leading Practices and Trends from the 2018 World’s Most Ethical Companies® click here.

Once again Ethisphere’s 2018 World’s Most Ethical Companies® demonstrate that good compliance and ethics leads to greater business returns.