SFO Charges Former Alstom Executive in Bribery Case
The U.K. Serious Fraud Office charged a seventh person in its long-running investigation of Alstom SA, the French engineering giant.
Risk and Compliance Journal
Reputation
Crisis of the Week: Valeant Effort at Communication Under Microscope
Valeant Pharmaceuticals is in the crisis spotlight this week after submitting a regulatory filing in which it admitted “tone at the top of the organization” may have been a factor in its “improper revenue recognition” and blaming blaming some of its problems on its former chief financial officer.
Bribery
Corruption Currents: France to Tighten Anti-Corruption Laws
France is tightening its anti-corruption laws after several French companies were hit with large fines abroad.
Bribery
Biomet Says Deferred Prosecution Agreement is Extended Again
Biomet Inc. had its deferred prosecution agreement with the U.S. government extended for an unprecedented second time, showing the risks of settling charges before having a full grasp on improper conduct.
Bribery
The Morning Risk Report: The Hidden Costs of Implementing Compliance
As banks continue to spend heavily on compliance, they aren’t doing as well at making sure the other parts of the company that implement the policies created by compliance have the proper resources to do their jobs, said one compliance consultant.
Bribery
Corruption Currents: China Emerges as Money-Laundering Hub
The Associated Press found that China is emerging as an international hub for money laundering.
Compliance
FBME Bank Vows to Challenge New FinCEN Rule
FBME Bank vowed to challenge a newly issued rule by the U.S. Department of Treasury accusing it of continuing to serve as a hub for illicit financial activity.
Compliance
The Morning Risk Report: Iran Hacking Charges Underline State Threat
Companies need to be prepared to deal with all sorts of cyberattacks, even if those hacks come from less-expected placed like state actors, according to one lawyer.
Bribery
Survey Roundup: Passwords at a Price
A survey of around 1,100 office workers at large companies found 20% said they would sell their corporate passwords to an outsider--and of those who would, 44% said they would do so for less than $1,000.
Compliance
U.S. Companies Must Confirm, Not Certify White-Collar Compliance
The process by which companies confirm to the U.S. Justice Department that they provided all information under the department's latest memorandum putting a focus on holding individuals accountable for white-collar crime will be something less binding than a legal certification.
Bribery
Corruption Currents: Former Blackwater Founder Faces Probe
The Justice Department allegedly launched a money-laundering investigation of Erik Prince, founder of now-defunct soldiers-for-hire firm Blackwater. An attorney for Mr. Prince denied the allegations.
Compensation
The Morning Risk Report: Using Anti-Fraud Tools to Fight Human Trafficking
Anti-corruption tools used by banks to fight money laundering and other types of fraud can also be used to help companies combat the use of slave labor in their supply chains.
Bribery
Corruption Currents: Google Fined by France Over Right to be Forgotten
A government agency in France fined Google $112,000 for failing to remove all links following a request made under the EU's right to be forgotten law.
Compliance
Data Transfer Hurdles Have Companies Hedging Bets
The data transfer agreement “Privacy Shield” has laid the groundwork for restoring reliable data transfer between the U.S. and EU, but it still has numerous hurdles to clear in the next months, leaving companies to hedge their bets on transfer mechanisms.
Latest News
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Iranian Miniskirts, Bags of Cash Raise Doubts Over Controls at HSBC WSJ
A monitor of HSBC’s vigilance against money laundering and evasion of sanctions has uncovered lapses in the wake of a 2012 settlement with the Justice Department.
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SEC Says Former Vanguard Lawyer Deserves Whistleblower Protection WSJ
The SEC has intervened in a legal battle between mutual fund giant Vanguard Group and one of the company’s former lawyers, claiming the ex-employee should qualify for U.S. whistleblower protections.
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High-Court Split Shields Mandatory Public-Union Fees WSJ
Public employee unions survived a threat to their power in nearly half the country as the Supreme Court deadlocked on a lawsuit designed to abolish their ability to require compulsory dues in more than 20 states.
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Lawyers Group Pushes to Oust Rousseff WSJ
Brazilian President Dilma Rousseff’s woes deepened as an influential lawyers group filed a new impeachment petition.
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SEC’s White Warns Directors to Be On Guard for Credit-Market Turmoil WSJ
Directors of mutual funds should look to the failure of a distressed-debt fund last year and probe how prepared their portfolio managers are for the kind of turmoil that doomed the Third Avenue Focused Credit Fund, SEC Chairman Mary Jo White said Tuesday.
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Wells Fargo to Pay $8.5 Million in Phone Recording Case WSJ
Wells Fargo will pay $8.5 million to settle allegations from California’s attorney general that the bank improperly recorded telephone calls without informing California consumers.
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NFL Demands Retraction of New York Times Concussion Article WSJ
The National Football League has sent a letter to the New York Times’ lawyers demanding a retraction of the publication’s investigation into the league’s research on concussions and alleged ties to the tobacco industry.
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More Companies Placing Limits on Director Pay WSJ
A growing number of Fortune 500 companies are putting limits on the stock awards they give directors, according to Willis Towers Watson PLC, a risk advisor and consulting firm. But the companies aren’t trying to keep directors’ pay low, so much as protecting directors from lawsuits.
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Justice Department to Get More Aggressive on Employment-Tax Fraud WSJ
The Justice Department is stepping up investigations and prosecutions of company executives who cheat on paying taxes withheld for their employees.
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SEC Investigating SunEdison’s Liquidity Disclosures to Investors WSJ
The Securities and Exchange Commission is investigating the solar-power company’s disclosures to investors about how much cash it had on hand as its stock price collapsed last year.
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Colgate Shuffles Leadership, Sets Up Race to Succeed CEO Cook WSJ
Colgate-Palmolive Inc. promoted two company veterans as part of a plan to line up an eventual successor to Chief Executive Ian Cook, who has run the company for nine years, according to people familiar with the moves.
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Some Advisers Err in Thinking They Won’t Be Affected by New Rule WSJ
Some financial advisers who are already required to act in their clients’ best interests think they won’t be affected by the coming Labor Department rule toughening standards for retirement-account advice.
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Starwood’s Chinese Bidder Remains Opaque Both at Home and Abroad WSJ
Beijing’s Anbang, locked in a bidding war with Marriott over Starwood Hotels, has a complicated web of investors that is difficult to unravel.
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Former N.Y. Assembly Speaker Sheldon Silver Disbarred WSJ
Sheldon Silver is no longer speaker of the New York State Assembly, nor a lawmaker of any rank. And now he's no longer a member of the New York bar.
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FTC Sues Volkswagen Over Advertising of Diesel Vehicles WSJ
The Federal Trade Commission added to Volkswagen’s legal woes with the filing of a complaint claiming the auto maker’s advertising falsely touted its diesel vehicles as environmentally friendly.
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Grooming Top Executives Includes Outside Board Experience WSJ
As they groom their star executives, more U.S. businesses are working hard to find them outside board seats.
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Businessman Denies Planning Bangladesh Central-Bank Heist WSJ
A central figure in the investigation into how $101 million was stolen from Bangladesh’s central bank said two Chinese nationals were responsible.
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Alpha Seeks to Sever Labor Pact, Cut Retiree Benefits WSJ
Alpha Natural Resources Inc. is asking a bankruptcy judge to let it slash retiree benefits and tear up existing labor agreements with its mine workers union, warning that its survival is at stake.
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FBI Opens Shooter’s iPhone; U.S. Drops Demand on Apple WSJ
The government said it had cracked a terrorist’s iPhone without Apple’s help and is seeking to drop its legal case to force the tech giant to unlock the device.
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Appeals Court Dismisses Tribune Creditors Clawback Lawsuit WSJ
A federal appeals court in New York has quashed efforts by some creditors of the former Tribune Co. to claw back shareholder profits from a leveraged buyout they blame for plunging the company into bankruptcy.
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Bank of England to Tighten Up ‘Buy-to-Let’ Lending Rules WSJ
The Bank of England seeks to impose more stringent criteria for lending to buyers who intend to rent out their properties.
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Law Creating Sex Offender Passport Mark Faces First Challenge WSJ
A group of convicted sex offenders is suing the federal government over a new law requiring the State Department to mark their passports with a ‘unique identifier.’
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Companies Invent Their Own Performance Benchmarks WSJ
Many companies are changing the benchmarks they use to define success. As they adjust to new delivery methods or changing consumer tastes, finance chiefs are rethinking what metrics they share with investors.
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‘War of the Roses’ Escalates at Wynn WSJ
A yearslong battle among the founders of the Wynn Resorts casino empire escalated, as Elaine Wynn filed a complaint in court that accused her former husband, Steve Wynn, of engaging in “risk-taking behavior” that could harm the company.
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Obama Administration Defends Limit to Power Plant Carbon Emissions WSJ
The Obama administration on Monday offered a comprehensive legal defense of its signature climate-change regulation limiting carbon emissions from power plants, telling an appeals court that the rule is well within the bounds of its authority.
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Chinese Browsers Leave Users Vulnerable, Report Says WSJ
Human-rights research group Citizen Lab said Tencent’s QQ Browser collected and transmitted data with weak encryption technology or without any encryption at all.
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Oil Explorers Hit by U.N. Commission Ruling on Falklands WSJ
British oil companies with interests in the Falkland Islands suffered a blow when a U.N. commission said that the waters around the South Atlantic archipelago belong to Argentina.
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China Seeks More Legal Muscle to Block Foreign Websites WSJ
China is considering new Internet rules that would pressure service providers to cut off access to foreign websites, adding to the government’s growing legal framework bolstering its control of cyberspace.
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Google and Oracle Must Disclose Mining of Jurors’ Social Media WSJ
Internet research by jurors is a common concern for judges. In a high-stakes copyright fight between two Silicon Valley giants, it's Internet research on jurors that's drawing particular scrutiny from the court.
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Amaya CEO Takes Indefinite Leave WSJ
Amaya said its CEO will take an indefinite paid leave to fight insider-trading charges and to focus on his takeover proposal for Canada’s online-gambling giant.
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Telefónica CEO César Alierta to Step Down WSJ
Telefónica Chairman and CEO César Alierta is stepping down after nearly 16 years at the helm of one of Spain’s largest companies, the telecommunications giant said.
CONTENT FROM OUR SPONSOR
DeloitteRisk management, strategy and analysis written and compiled by Deloitte
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Ways to Engage Employees Amid a Corporate Crisis
Engaging employees before and during a crisis could significantly impact an organization's ability to respond to an incident, as well as to recover from it. Nonetheless, nearly one-third (29.8%) of respondents in a recent poll of some 3,900 professionals believe that employees may be the most overlooked stakeholder when their organization is dealing with a crisis. Learn six ways to engage employees more deeply during a crisis.
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Managing Third-party Risks to Create and Protect Value
Third-party relationships have the power to affect shareholder value negatively or positively, often exponentially in relation to the vendor’s size and type of service provided. While the focus often is on protecting the organization from downside losses, companies that proactively manage third-party risks across the extended enterprise stand to reap substantial upside benefits in terms of increased productivity, contract and asset optimization, and other opportunities.
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PBS CFO Barbara Landes: Using Risk Assessments to Guide the Budgeting and Planning Process
With a strategic planning background and corporate finance acumen, Barbara Landes, CFO of the Public Broadcasting Service, is used to keeping a critical eye on both long- and short-term horizons. That’s one reason she uses a risk assessment process to begin her budgeting and planning efforts, which she says helps guide corporate strategy as well as asset allocation. In addition, Ms. Landes discusses how she measures growth at the not-for-profit media enterprise and develops talent, among other issues with Allan Cook, director, Deloitte Consulting LLP.
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Behavioral Strategy to Combat Choice Overload: Weekend Reading
A foundational concept in the behavioral field is choice architecture, explaining how the way choices are organized influences behavior. However, a better architecture may be necessary to assist managers in leveraging insights from the field, according to a report from Deloitte University Press. In this report excerpt, authors Timothy Murphy and Mark Cotteleer offer a straightforward, managerial-focused behavioral science framework that puts the business objective where it belongs: first.
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Proactive Engagement Helps Build Shareholder Loyalty
Many companies are becoming increasingly proactive in engaging with their shareholders, with some implementing a governance function, often through the corporate secretary or general counsel, to lead engagement on governance matters. Further, boards are increasingly taking a heightened role in directly engaging shareholders, especially on topics such as executive compensation and board composition, according to the “2016 Directors’ Alert” from Deloitte Touche Tohmatsu Limited. Learn more about what role boards can play and questions directors can pose to management about shareholder engagement.
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Three Steps To Improve Improper Payments Prevention Strategies
Despite continuing efforts by federal agencies, improper payments remain a government-wide issue. Federal agencies can help strengthen their strategies to prevent improper payments by taking three steps: establish a holistic improper payments risk management framework; employ continuous monitoring using data analytics; and deploy root cause analysis techniques to identify and implement corrective action plans. Learn critical elements in implementing these actions, along with the Government Accountability Office Fraud Risk Management Framework, which incorporates leading practices to identify and mitigate fraud risks.
Global Risk Map
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