I had the chance to meet Michael Fine last spring at the Dow Jones Compliance conference in Washington DC. For those of you in the compliance arena who do not know him he has worked as a Consultant to Transparency International (TI) on the export credit agency survey/report "Export Credit Agency Anti-Bribery Practices 2010″; has been involved in Legal/drafting support for World Economic Forum "PACI Principles for Countering Bribery," a model anti-corruption program for international business; and has made a Comprehensive study of compliance "best practices" at leading multi-national companies including corporate bench-marking reviews. In short he is someone who knows his way around anti-corruption and anti-bribery.
In the September/October issue of the SCCE Magazine we are treated to an analysis by Fine of le affaire Wal-Mart entitled "A teachable moment: FCPA lesson from the Wal-Mart experience." While several commentators, myself included, have written or spoken about some of the lessons learned from the Wal-Mart Foreign Corrupt Practices Act (FCPA) story which was broken by the New York Times (NYT) on April 21, 2012, I found Fine's discussion fresh and he put several points together in a manner which is of use to the compliance practitioner as a review of his or her compliance program.
After a review of some FCPA basics, including (1) nationality jurisdiction, (2) subsidiaries, (3) intermediaries, (4) business advantage and (5) exceptions; Fine reviewed some of the basic allegations made in the NYT article for conduct which is alleged to have violated the FCPA. In addition to the allegations of bribes paid, usually in cash, "to expedite store expansion in Mexico, as part of a strategic plan to outpace competitors and establish market dominance", senior leaders in Bentonville were made aware of the allegations, they sent the investigation back to Mexico so that the very persons alleged to have committed the bribery were charged with investigating the allegations of bribery.
From the allegations made to date, Fine developed a list of issues which any compliance practitioner could use as a guidepost going forward when looking at their company and its compliance program.
I found Fine's article a good analysis of the issues facing Wal-Mart. Moreover, a compliance professional can use these to review and evaluate your company's program quickly. If there are gaps based upon some or all of the Wal-Mart allegations, you should move to remedy them. Whether you use self-evaluation or bring in a third party to perform a risk assessment, the more quickly you evaluate your program, the better shape you will be in from a FCPA compliance perspective.
Visit the FCPA Compliance and Ethics Blog, hosted by Thomas Fox, for more commentary on FCPA compliance, indemnities and other forms of risk management for a worldwide energy practice, tax issues faced by multi-national US companies, insurance coverage issues and protection of trade secrets.
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© Thomas R. Fox, 2012
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