Hui Chen knows a thing or two – or seven – about compliance.
As the DOJ’s first-ever compliance counsel expert, she was the exclusive consultant to the white-collar watchdogs in the Fraud Section, working on landmark cases such Petrobras, Tenet Healthcare, VW and BP’s Deepwater Horizon debacle. Previously, she served in senior compliance positions at Microsoft, Pfizer and Standard Chartered Bank. Now a consultant, she has distilled her learning into seven red flags she says are reliable markers of ineffective compliance programs:
1. Lack of Financial Discipline
. . . utter absence of centralized visibility into financial transactions.
2. Legal-Dominated Compliance
. . . less interest in programs that work than programs that look like a legal defense.
3. Sentencing Guideline Standard
. . . how good do I have to be so when I’m caught I won’t go to jail?
4. Training Completion Rate
. . . counting completion rates merely demonstrates the existence of a program.
5. Focus on Due Diligence
. . . real risks arise during a company’s work with employees/vendors, not just when the relationship begins.
6. Single-Statute Emphasis
. . . programs equated with a single statute, such as FCPA, fail to drive organizational controls.
7. Disproportionate Focus
. . . lopsided tilt to gifts, meals and T&E betrays rudimentary understanding of the risk landscape.
See www.huichenethics.com for more on Chen’s list.
Source: Bloomberg BNA
Published January 11, 2019.
