Transcript Corporate Compliance Overview

CORPORATE COMPLIANCE
OVERVIEW
David Meisels
OSB Corporate Counsel Roundtable
April 26, 2012
What is Corporate Compliance?
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It’s a program to identify, prevent and report
improper conduct within an organization.
Typical compliance programs include policies for:
 Document
Retention
 Code of Conduct (Ethics)
 Antitrust
 Anti-Bribery (FCPA & UK Bribery Act)
 Import/Export Regulation
 Reporting Mechanism
Why Have a Compliance Program?
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The requirement to have a corporate compliance policy
stems from various rules and statutes specifically:
Sarbanes Oxley for publicly traded companies
 The Federal Sentencing Guidelines for Organizational
Defendants of 1991 which gives credit for having and
enforcing an effective compliance program (mitigating
factor in culpability score)
 The Office of Inspector General (for health care entities)
 Various federal laws and regulations in the financial
services industry
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Characteristic of an Effective Program
Written policies & procedures
 Designate a compliance officer and other appropriate
bodies
 Conduct effective training and education programs
 Develop effective lines of communication
 Enforce standards through well publicized disciplinary
guidelines
 Conduct internal monitoring and auditing
 Respond to offenses promptly and develop corrective
action
(source OIG)
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What Else is Required?
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Cannot be merely a paper program – is it designed
and implemented in an effective manner?
Training
Updating
Enforcement
Remedial Action Taken
Discussed/Publicized
Compliance – Who Leads?
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Who should lead compliance efforts?
Typically a Chief Compliance Officer and a Compliance Committee
No requirement as to who leads
OIG in its settlement agreements says it cannot be the in-house legal
department, the GC or CFO
The CCO should have at minimum dotted line reporting to the CEO
and/or Board of Directors
Duties: developing, operating, and monitoring the compliance
program
Some companies have an independent CCO; others use an HR,
Finance or Legal department employee (but see legal issues)
Issues: In-House Lawyer as CCO
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Different skill set: team building, encouraging communication,
dialogue and disclosure, openness, approachability
Conflict in Roles: “It doesn’t take a pig farmer from Iowa to smell the
stench of conflict in that arrangement” (Chuck Grassley chair of
Senate Finance Committee)
Attorney: duty to defend client
CCO: duty to make sure laws are being followed
Attorney Client Privilege Issues
Emphasis on self reporting, voluntary disclosure and transparency vs.
confidentiality, maintaining Privilege
Deferred prosecution in exchange for Privilege waiver
Sufficient time to wear both hats?