More Major Justice Dept. News

justice

Corporate compliance officers, drop everything. We have a second speech from the Justice Department about corporate misconduct and compliance programs that needs your immediate attention.  Assistant attorney general Kenneth Polite gave the speech in Texas on Friday. It follows the speech that his boss, deputy attorney general Lisa Monaco, gave one day earlier in New…

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‘Reasonably Designed’ Programs, Part II

reasonably

Our post last week about the lack of clear standards for a “reasonably designed” compliance program drew lots of comment from compliance professionals — enough that the issue deserves continued exploration, since there’s plenty more to say on the subject.  First let’s consider a concrete example of the confusion that could arise here.  Imagine your…

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‘Reasonable Design’ and CCO Certifications

reasonable

Today I want to revisit the Justice Department’s plans to have chief compliance officers certify the effectiveness of their compliance programs, to unpack a question that’s been bothering me. When the department says it wants certification that your program is reasonably designed to prevent future violations, what does “reasonable” actually mean?  Readers of Radical Compliance…

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Lawyer Busted on Fake Complaints Scam

Unbelievable story today from the annals of Compliance Professionals Gone Wild: the former lawyer for a Tennessee trucking company has been disbarred for fabricating employee complaints, which he then used to launch sham remediation hearings and pocket the settlement money himself by forging the employees’ signatures.  The lawyer in question is one Glen Ray Fagan,…

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Thoughts on Training and CCO Certifications

training

So there I was the other day, talking with a compliance officer who helps with training at a large global corporation. We were chatting about a fairly common question in the field: should companies allow people to test out of compliance training if they already know the subject matter?  That’s a complicated question unto itself,…

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On Compliance Officers Certifying Their Programs

reasonable

Folks, we need to talk about the Justice Department’s new idea to have chief compliance officers certify at the end of a deferred-prosecution agreement that their company’s compliance program is reasonably designed and effective. I am a fan of the Justice Department and strong compliance programs — but can something like this really work in…

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FINRA’s Olive Branch on CCO Liability

cco liability

FINRA, the regulator for broker-dealer firms, is trying to ease tensions over chief compliance officer liability with a new alert stressing that FINRA typically will not bring enforcement actions against CCOs personally because compliance officers don’t inherently have a supervisory role at their firms.  FINRA published the alert late last week, after several pleas from…

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Analyzing the Latest CCO Liability Case

cco liability

Stop me if you’ve heard this one before: a chief compliance officer faces personal legal liability for compliance failures at his firm, and everyone got into a tizzy over it. Then, upon reading the facts of the case, a more complicated picture emerges that demonstrates just how tricky a subject CCO liability can be.  Such…

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Another CCO Liability Proposal

cco liability

The National Society of Compliance Professionals, which represents compliance officers specifically in the financial services world, has released a proposed framework to help regulators understand the threat of chief compliance officer liability and when such liability is or isn’t warranted for a compliance failure. The NSCP released its framework on Monday: a series of nine…

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Goldman Compliance Officer Busted on Insider Trading

cco liability

A senior compliance analyst at Goldman Sachs has been charged with insider trading by the SEC, which says the man racked up more than $470,000 ill-gotten profits by trading in brokerage accounts held under his parents’ names.  The man, Jose Luis Casero Sanchez, worked in the control room of Goldman’s offices in Warsaw, Poland, from…

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