Compliance Bricks and Mortar for April 15

These are some of the compliance-related stories that recently caught my attention.


Am I a Good Compliance Officer? by Kristy Grant-Hart in SCCEs Compliance & Ethics Blog

I thought for a long time about a single criterion which could determine whether a person was good or bad at the job. I finally decided that the best way to determine whether a person is a good compliance officer is whether, over time, the business proactively comes to the compliance officer with problems or to ask for advice. The most successful compliance officers are those who gain the trust of the business and who become integral to its operations. [More…]

The Morning Risk Report: Report Details ‘Right Way’ to Teach Ethics

The research involved showing the survey subjects a conflict of interest presented in four different ways: just presenting it and asking them what they thought; providing them a dictionary definition of what a conflict of interest is; giving them one example of a conflict and, finally, giving them two examples and asking them to compare them, said Mr. Loewenstein. In the first three instances, about 10% to 15% of the subjects were able to identify the conflict, whereas in the final instance the numbers jump to between 30% and 50%, he said. [More…]

What Goes on a Compliance Dashboard? by Matt Kelly in Radical Compliance

The starting point should be to ask, what worries compliance officers and general counsels the most? That is easy enough to answer at a high level: you worry that risks the company has are metastasizing beyond your comfort zone. A dashboard should show you which risks may be doing that at any given time. [More…]

The SEC’s Shift to Administrative Proceedings: An Empirical Assessment by Stephen J. Choi and Adam C. Pritchard in the CLS Blue Sky Blog

We show that the shift toward administrative proceedings has been accompanied by a substantial increase in the average civil penalty imposed on non-financial public companies named as defendants, both in court and in administrative proceedings. We also provide evidence that the complexity, and thus the cost, of cases the SEC brings in administrative proceedings increased after the enactment of Dodd Frank. Specifically, we show an increase in two proxies for the complexity of the nature of the alleged underlying securities law violation, the disgorgement amount, a measure of the underlying profits from the alleged securities law violation, and the number of years during which the violation allegedly took place. Violations that involve greater profits are likely to be longer running and involve more transactions and participants. [More…]

Managing Gatekeeper Anxiety by Michael W. Peregrine in the D&O Diary

Corporate board members are encountering a new, perhaps unexpected and likely distracting oversight responsibility: managing the personal liability concerns of corporate “gatekeepers”. This new responsibility is the byproduct of three particular, intersecting developments: the Department of Justice enforcement focus on individual accountability; regulatory scrutiny of the role of corporate “gatekeepers” in connection with financial reporting and corporate compliance; and ongoing litigation addressing access to traditional individual defenses. The corporate board will want to pursue pro-active responses to these concerns in order to assure the continued engagement of its valued “gatekeepers”. [More…]