Ted Kang, partner in the firm’s Government & Internal Investigations Group, was quoted in a Financier Worldwide cover story discussing corporate fraud and corruption trends, and steps that companies can take to mitigate those risks.
“In just the past year, we saw three of the 10 largest FCPA settlements in history, with Total, Alcoa and Weatherford paying $398 million, $384 million and $152 million in penalties, respectively,” Kang said.
“Holding individuals accountable for violations of the FCPA has also been a continued enforcement priority—since 2013, 16 of the 24 FCPA actions brought by the DOJ have been against individual executives,” he said. “These statistics all point to the need for multinational corporations, and their senior executives, to continue to ensure they have a robust anti-corruption compliance program in place.”
Kang said providing employees with a channel to elevate concerns regarding potential fraud and corruption is an essential factor of any compliance program.
“One method that many companies use effectively to encourage this type of ‘internal whistleblowing’ is to provide employees access to a 24-hour hotline to report misconduct on an anonymous basis,” Kang said.
“The company, of course, must then make sure that complaints received are appropriately investigated, at the direction of in-house counsel, outside counsel or a combination of the two,” he explained.
“The investigative steps—including interviews, requests for documents and decisions related to the investigation’s scope—must be appropriately memorialized and all relevant documents preserved.”
On looking ahead, Kang said, “I have seen companies rely increasingly on technology to help guide their assessment of risk and determine which segments of their business need greater attention from a compliance standpoint.”
“Although technology can never be a perfect substitute for human judgment, when used correctly, it can streamline and expedite the processing of large volumes of data. That information can help focus a company on the right ‘touch points’ within their organization that are susceptible to fraud and corruption.”