Welcome to This Week In Compliance: GAN’s weekly news roundup, where we curate the latest stories on compliance and anti-corruption to keep you informed. This week, France updates guidance on gifts & entertainment. Read the updates and find more compliance news below:
France Updates Guidance on Gifts & Entertainment
The French Anti-Corruption Agency (AFA) released new guidance on gifts and entertainment for companies, foundations, and associations. The guide (in French) endows companies with practical advice on how to design appropriate policies for the management of their gifts & entertainment processes to avoid the risk of corruption and influence peddling. Among other things, the Sapin II updates state that all organizations should have a clear internal policy on gifts & entertainment based on a prior mapping of corruption risks and emphasizes the importance of proper communication of the policy both internally and externally. The new guidance also recommends that companies establish a gifts registry to guarantee transparency and track the behavior of third parties.
American Nissan Exec Faces Trial in Ghosn Corruption Case:
After Nissan's former CEO Carlos Ghosn fled Japan amid corruption charges, the executive's American aide stood trial in a Tokyo court earlier this week. Greg Kelly is accused of helping Ghosn hide millions of dollars from regulators through a deferred payment system. Ghosn describes the Japanese justice system as rigged, which on average has a conviction rate of more than 99 percent. Kelly denied all the allegations and defended Ghosn by conveying 'the good that Ghosn brought to Japan' implying that the executive deserved the benefit of the doubt.
Volkswagen Completes Dieselgate Compliance Monitoring Period:
After Volkswagen AG's emissions scandal in 2015, the German automaker reached a settlement with U.S. authorities in 2017 that involved establishing an independent compliance monitor for three years. In 2015, Volkswagen admitted to defrauding millions of customers by selling cars that contained software used to cheat on carbon emissions requirement tests. The company announced the end of the monitoring period and reported that they have appointed Chief Compliance Officers in different divisions of the business, set up channels for compliance advice, and implemented over 300 new internal policies to expand on the company's compliance processes.
Deutsche Bank's Compliance Program Limits Fine in Sanctions Settlement:
A recent settlement between a unit of Deutsche Bank AG and the U.S. points to the importance that robust compliance programs can bring for reduced penalties. Deutsche Bank's American unit will pay USD 583,100 to the U.S. Treasury’s Office of Foreign Assets Control (OFAC) for doing business with a sanctioned Cypriot company and a Russian financial institution. OFAC reported several mitigating factors that contributed to Deutsche paying only a fraction of the theoretical maximum penalty of USD 75 million. The Wall Street Journal reports that OFAC credited the company for having a sanctions compliance program in place at the time of the violations. OFAC recognized a failure in the company's sanctions screening system and also credited the bank for its full collaboration with the investigation.
Policy & Guidance Updates
CFTC Issues Guidance on Corporate Compliance Programs:
The U.S. Commodity Futures Trading Commission (CFTC) published a three-page memo on new guidelines for evaluating corporate compliance programs. The guidance will be used by CTFC's enforcement division to determine the state of a company's compliance program at the time of the offense and to evaluate if the company took appropriate steps to fix compliance problems. The guidance denotes that CTFC staff will evaluate whether the compliance function is (1) sufficiently resourced and (2) independent. The memo also highlights that the CFTC will question whether the company has appropriate internal reporting and monitoring systems and will question remedial action post-internal misconduct instances. According to a former director of the CFTC's enforcement division, the guidance sends a clear message that compliance programs should evolve with a company's growth, rather than being static.
Lula Charged with Corruption in Odebrecht Case:
As a part of Brazil's Car Wash corruption investigation, former Brazilian President Luiz Inácio Lula da Silva is facing new corruption charges, this time concerning Odebrecht. According to Brazilian prosecutors, Lula received bribes from Brazilian construction conglomerate Odebrecht disguised as donations in exchange for contracts with Petrobras, Brazil's state-owned oil company. The former president is facing nine different corruption charges against him. Lula has stated that he will appeal the allegations, which he dismissed as politically motivated. Last November, he was released from jail after having been imprisoned for three months amid an investigation into the purchase of a beachfront apartment in Sao Paulo state.
Federal appeals court upholds 5.6B USD Visa and Mastercard settlement
The DOJ updates its guidance on corporate compliance programs
Founder and former FTX CEO arrested, indicted on eight fraud charges