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, the former CEO of Wells Fargo settles charges for the fake-account scandal. Read the full story and more news below:
Wells Fargo Ex-CEO Settles Fake-Account Scandal:
Former Wells Fargo Co-CEO John Stumpf settled civil claims over his role in the 2016 fake accounts scandal for USD 2.5M. The fake accounts scandal surfaced in 2016 after the U.S. Securities and Exchange Commission (SEC) charged the bank USD 3BN for having created millions of savings and checking accounts for customers without their consent as a means to inflate the company's financial statement with 'more sales'. Stumpf, who stepped down from his position in 2016, stands accused of deceiving investors by presenting misleading figures based on fake bank accounts and did not admit or deny any wrongdoing.
Two Arrested in Harvard Bribery Case:
Former Harvard fencing coach Peter Brand and businessman Jie “Jack” Zhao were arrested for bribery accusations on Monday, November 16th. Brand stands accused of receiving USD 1.5M in bribes from Zhao in exchange for helping his sons get admitted to the Ivy League university to join the fencing team. The arrest comes a year after the U.S. bribery admissions scandal surfaced to the public in 2019. Harvard fired Brand in 2019 for violating the university's conflict-of-interest policies.
Switzerland to End Tax Deductions for Bribery by 2022:
Switzerland's current legal framework easily permits bribes to private individuals to be filed as tax-deductible business expenses. Even though Switzerland's anti-bribery framework bars private bribery, this tax law has long been seen as a loophole in Switzerland's anti-bribery enforcement. The Swiss government announced that following the OECD's recommendations on tax and criminal law, the country will follow the guidelines and adopt a new law prohibiting this practice that will be effective by January 2022.
OECD Praises U.S.’s Foreign Anti-Bribery Enforcement:
According to the OECD's Working Group on Bribery in International Business Transactions's latest report on the progress of the implementation of the OECD'S Anti-Bribery Convention in signatory nations, the U.S. continues to lead in enforcement against transnational corruption. The OECD also praised the SEC's whistleblower program that set new records for tips in 2020 and also urged U.S. authorities to increase whistleblower protection measures. The report recommended U.S. enforcement agencies increase the transparency of some of their FCPA resolutions to the public to make it easier for companies to obtain information on non-prosecution agreements and deferred prosecution agreements.
Croatia’s Former PM Sentenced to Jail for Embezzlement:
Croatia's Country Court sentenced former PM Ivo Sanader to eight years in prison for embezzling public funds through a marketing company for personal enrichment and his party's use. The former PM who served from 2003 to 2009, also stands accused of illegally making USD 42,900 and would have to pay USD 2.5M with his family if convicted. Sanader's party, the Croatian Democratic Union (HDZ), will also have to pay more than USD 2M for illegal enrichment. The marketing company that was used to funnel the money faces a fine of USD 1.85M.
U.S. Drops Charges Against Mexico's Ex-Defense Minister:
Corruption and drug-trafficking charges against Mexico's former Defense Minister Salvador Cienfuegos were dismissed by U.S. Attorney General William Bar for foreign-policy concerns. Cienfuegos, who was accused of accepting bribes in exchange for cartel leader protection, was being held under arrest and was allowed to return to Mexico after the latter threatened to cut off cooperation with the U.S. unless the Minister was repatriated. Mexican authorities opened an investigation into the public official in Mexico based on evidence gathered by U.S. prosecutors.
DOJ issues further guidance, warnings on ephemeral messaging apps
Federal appeals court upholds 5.6B USD Visa and Mastercard settlement
The DOJ updates its guidance on corporate compliance programs