Navex Global claims to be the “ethics and compliance experts” and offers training courses that presumably seek to minimize a business organization’s FCPA risk.
However, in this recent post Navex asserts that “domestic workers who have no involvement in foreign sales probably don’t need training in the FCPA.”
This assertion is wrong on so many levels and if followed actually increases – not decreases – a business organization’s FCPA risk.
For starters, the suggestion that FCPA risk and scrutiny arises only from foreign sales shows a poor understanding of how the FCPA is actually enforced.
Sure, Congress did intend the FCPA’s “obtain or retain business” element to mean just that, however in the FCPA’s modern era numerous instances of FCPA scrutiny (and resulting enforcement actions) arise from seemingly mundane business tasks such as securing foreign licenses and permits, moving product or equipment from point A to point B, and interacting with various foreign regulatory officials.
To best minimize FCPA risk, it it is critical that company employees who perform these routine tasks are included in FCPA training so that they know how their job functions could present FCPA scrutiny given prevailing enforcement theories. Such employees include not just foreign employees, but also domestic (U.S.) employees who have oversight and supervision regarding the above tasks.
Finance, accounting, and auditing personnel are another category of domestic workers who have no involvement in foreign sales, but most certainly should be trained on the FCPA and have a clear understanding of the important role they can play in FCPA compliance.
Indeed, FCPA enforcement agencies have high expectations for such financial gatekeepers. In one enforcement action, a company was dinged because “local finance personnel did not provide an independent internal control function, but rather acquiesced in questionable practices and documentation without critical review.” In another enforcement action, a company was dinged because the “audit department had no procedures specifically designed to asses the FCPA or bribery risks of sales and purchases.” In yet another enforcement action, a company was dinged because there was “no oversight from the company’s finance department” and “no one questioned” many of the problematic business practices. Relevant to the role of financial gatekeepers here is what the DOJ’s “Evaluation of Corporate Compliance Programs” (a policy document highlighting 11 factors relevant in evaluating a corporate compliance program) states:
- Gatekeepers – Has there been clear guidance and/or training for the key gatekeepers (e.g., the persons who issue payments or review approvals) in the control processes relevant to the misconduct? What has been the process for them to raise concerns?
Due to several recent FCPA enforcement actions concerning internship and hiring practices, human resources personnel are another category of domestic workers who have no involvement in foreign sales, but most certainly should be trained on the FCPA and have a clear understanding of the important role they can play in FCPA compliance. For instance, in one enforcement action a company was dinged because “several important business functions such as human resources and hospitality planning were not considered in [the company’s] FCPA compliance program.
Due to several recent FCPA enforcement actions concerning charitable donations, personnel involved in charitable giving are another category of domestic workers who have no involvement in foreign sales, but most certainly should be trained on the FCPA and have a clear understanding of the important role they can play in FCPA compliance. For instance, in one enforcement action a company was dinged for insufficient controls “regard[ing] due diligence and controls surrounding foreign charitable donations.”
In short, Navex Global is just plain wrong in asserting that “domestic workers who have no involvement in foreign sales probably don’t need training in the FCPA.” As highlighted above, there are any number of “domestic workers who have no involvement in foreign sales” that should be trained on the FCPA so that they know how their job functions could present FCPA scrutiny given prevailing enforcement theories.
If you are looking for an FCPA training course that accomplishes this objective and provides various employees (and not just those in sales) with “FCPA goggles” so that they know how their job functions could present FCPA risk, see here.
