Prison Professors With Michael Santos

Companies primarily adopt compliance programs because they recognize the need to mitigate risk. Leaders want to get the end result of a safer workplace with less legal exposure. Merely adopting a compliance program, however, without comprehensive implementation, may not yield the return on investment that a leader wants. On any given day, we can turn to the Department of Justice website to read press releases of criminal indictments for white collar crime. Many of the defendants in those cases began without any intention to break laws. Yet a lack of a clearly defined business model, or well-engineered compliance system, put those people into the cross hairs of a government investigation. High legal costs and criminal proceedings followed. All businesses stand vulnerable to the dangers of a government investigation. For these reasons, leaders should take steps to minimize their exposure. That means they should put plans in place to show a commitment to transparency, compliance, and good corporate citizenship.

Visit us at ComplianceMitigation.com As described in earlier modules, government investigators do not act without having a specific intention. If they ask questions or subpoena documents, they likely already have invested thousands of hours and they believe they can build a case. When they start talking with people in a company, they want to gather more evidence. Their investigations will be in an advanced stage, but the witnesses may not know anything about the nature of the inquiry. Some investigators will try to intimidate or trap witnesses. When initially approached, people that work for companies may get nervous. They may: Believe they didn’t do anything wrong and act belligerently, Deny that they didn’t do anything wrong and make statements that can hurt them, Accuse others within the organization in an effort to minimize culpability, Cooperate fully without knowing or understanding whether they are exposing themselves to legal complications. If the company does not help team members understand the na

ComplianceMitigation.com Previous modules offered insights we believe leaders should consider when designing an effective compliance program and risk-management strategy for their organizations. The more leaders customize their compliance and best-practice programs, the better they safeguard against intrusive investigations that could threaten the business and its team members. Regardless of what efforts team members make to protect a company, possibilities always exist for a breakdown, or for a rogue team member that could expose the organization to liability. For that reason, all companies should create a plan that would coordinate a team response in the event of an inquiry from regulators or law enforcement.   Lack of Planning Brings Vulnerabilities: In the absence of a structured response plan, team members may not know what to do if they learn that authority figures have taken an interest in the company or in a team member. Sometimes, leaders act rashly. People have gone to prison for their response to a

Compliance Mitigation dot com   For reasons expressed throughout these modules, every business leader should consider possible steps to lessen potential exposure to a government investigation. Three suggestions follow: Show a commitment “to doing good” in all communications. Document processes that show a commitment to operating the business with principled, transparent policies that are easily defensible. Train all team members to understand the corporate culture, and also the reasons behind every policy in place. These three components would go a long way toward protecting businesses and individuals.   Government Officials: In 1991, the U.S. Sentencing Commission (USSC) amended its guidelines. The amendments incentivized business owners to act in compliance with regulations and the law. Those changes opened opportunities for prosecutors to grant leniency, non-prosecution agreements, or deferred-prosecution agreements to businesses that put “effective compliance programs” in place. Theoretically, if busine

Visit us at Compliance Mitigation.com   Although we can control our own behavior, we don’t always have an ability to know how others will behave. When business leaders delegate responsibilities, they simultaneously raise their level of risk. Business leaders may not know what a team member is saying to a customer or how that team member may be acting in fulfilling job responsibilities. When that happens, the team member may expose the entire company to interference from regulators, or losses from internal fraud. For example, consider Justin, a co-founder of one of our companies. Justin graduated from USC and went on to become a stockbroker. While employed as a stockbroker at UBS, he executed market trades on behalf of people that managed private hedge funds. In that role, Justin had insight into account balances for the clients he served; he could also review balances in each of the client accounts at the hedge-fund. UBS trusted Justin took to look after the interests of his clients, and also after the intere