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Friday Roundup

Roundup

ISO 37001 airball, from the Inspector General report, scrutiny alert, good lord, marketing an impossible dream, root causes, and yes it is. It’s all here in the Friday roundup.

ISO 37001 Airball

If you have an interest in the non-story of ISO 37001 check out this podcast in which Alexandra Wrage (Trace International) asks some very good questions of a Microsoft representative.

To use a basketball analogy, the Microsoft’s reps answers were air balls full of buzzwords and cliches. 

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The Government Bears Some Responsibility For Certain FCPA Enforcement Actions

respon

Many Foreign Corrupt Practices Act enforcement actions do not occur in a vacuum. In certain instances, the road to FCPA violations is laid years, in some cases decades, earlier by government policy encouraging certain companies to do business in certain countries to accomplish certain political objectives.

An analogy would be a parent telling a child to go play in the playground frequented by”bad” kids and then, after a few weeks, the child swearing and telling dirty jokes around the house. In other words, don’t be surprised by the end result, the parent sent the child to the playground in the first place.

In light of the recent FCPA enforcement actions concerning business conduct in Libya (see here and here) in which the U.S. government explicitly encouraged companies to do business in the country upon the lifting of sanctions in 2004, it is worth pausing to consider whether the government bears some responsibility for certain FCPA violations.

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Issues To Consider From The Legg Mason Enforcement Action

Issues

This previous post went in-depth into the DOJ’s recent Foreign Corrupt Practices Act enforcement action against Legg Mason. This post continues the analysis by highlighting additional issues to consider.

SEC Enforcement Action Is Forthcoming

Given Legg Mason’s recent disclosure (see here for the prior post), it was a bit of a surprise that this week’s enforcement action included only a DOJ component. FCPA enforcement actions against issuers that involve a DOJ and SEC component are almost always announced on the same day.

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Canada-Based Kinross Gold Corp. Resolves Approximate $1 Million SEC Action Because Its Acquired Indirect African Subsidiaries Had Deficient Internal Controls

Kinross

Silly you for believing certain commentator hype that the Trump SEC would stop enforcing the Foreign Corrupt Practices Act or for thinking that the general lull in SEC corporate enforcement during the fourth quarter of 2017 meant anything.

In the second SEC corporate FCPA enforcement action in the last 2.5 weeks (see here for the prior Elbit Imaging action), the SEC announced yesterday that Canada-based Kinross Gold Corporation (a company with shares traded on the New York Stock Exchange) resolved an enforcement action “arising from the company’s repeated failure to implement adequate accounting controls of two African subsidiaries.” Without admitting or denying the SEC’s finding in this administrative order, Kinross agreed to, among other things, pay a $950,000 civil penalty.

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A Positive Correlation Between Bureaucracy and Corruption

Overlap

Previous posts (see herehere and here) have posed the question several times.

Why do Foreign Corrupt Practices Act violations occur?

Do companies subject to the FCPA do business in foreign markets: (i) intent on engaging in bribery as a business strategy and without a committment to FCPA compliance; or (ii) with a committment to FCPA compliance, yet subject to difficult business conditions?

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