Compliance Bits and Pieces for February 24

These are some compliance-related stories that recently caught my attention:

The SEC’s Whistleblower’s Office did not email you

It’s spam, linked to a virus. [Insert joke here...]

Are Auditors Reporting Fraud And Illegal Acts? The SEC Knows But Isn’t Telling by Francine McKenna in re: The Auditors

Section 10A of the Securities and Exchange Act of 1934 requires reporting by auditors to the Securities and Exchange Commission (SEC) when, during the course of a financial audit, an auditor detects likely illegal acts that have a material impact on the financial statements and appropriate remedial action is not being taken by management or the board of directors…..

So I prepared a Freedom of Information Act (FOIA) request in June and then again in October for the same information Congress and the GAO had previously requested from the SEC. The first request I made covered the entire period since the last report to Congress, 2003, until the present. It also referred to a tracking system that the 2003 report said would be implemented to help track these submissions by auditors and the SEC’s actions on them.

AML Moneyball by C.M. Matthews in WSJ.com’s Corruption Currents

As the field of anti-money laundering software vendors gets more and more crowded, it’s not always easy to spot a stud from a dud.

In 2012, financial institutions will spend an estimated $504 million on AML software products. When a bank relies on software to filter AML watch lists or monitor suspicious transactions, there’s a lot of pressure to get it right.

Celent’s survey of AML compliance vendors is a good place to turn to for the confused financial institution (or AML vendors who want to keep up with their competitors). It reads like Moneyball for AML compliance professionals (though it’s doubtful the report has enough crossover appeal for a Hollywood movie).

Conflicts of Interest in Joint Ventures – the Rights of “Consenting Adults” in the Conflict of Interest Blog

The governance and operation of JVs can certainly raise conflict of interest concerns. For an employee of a JV’s co-owner who is either on the JV’s board or is seconded to the JV whose interests to be treated paramount? Given the inherent tension in situations of this sort, those involved have good reason to clearly articulate applicable duties and expectations.

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