Feds Oil Up Their Anti-bribery Machine

Feds Oil Up Their Anti-bribery Machine - 7/29/2009

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HEADLINES \| SETTLEMENTS AND DISMISSALS \| COURT FILINGS LINKS TO OTHER NEWS \| NEWS ARCHIVE	HEADLINES ARCHIVED SETTLEMENTS AND DISMISSALS ARCHIVED

HEADLINE NEWS:

Feds Oil Up Their Anti-bribery Machine, Why Should Cfos Worry? Their Liability For Signing Off Under The Sarbanes-Oxley Act Is One Reason. Another: Their Responsibility For Corporate Compliance.
David McCann

. July 29, 2009
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EXCERPT: Driven by the mass globalization of business, the U.S. government is continuing to speed up its enforcement of the Foreign Corrupt Practices Act. Besides the increased compliance and legal risks to companies that the increased FCPA activity represents, it also presents the likelihood that CFOs will face mounting personal liabilities, experts say. While just a few years ago there were only about 20 or 30 open cases at any one time, 19 new cases against companies were opened in the first half of this year, adding to the 100 or so under way as of the end of 2008. That doesn't mean there are 119 companies being prosecuted. Many are being pursued both civilly by the Securities and Exchange Commission and criminally by the Department of Justice, which counts as two cases in the government's accounting of the numbers, according to Manny Alas, a partner and co-head of the FCPA practice at PricewaterhouseCoopers. FCPA actions against individual executives are also shooting up. The average number of such proceedings launched was 6 per year from 2002-2005, 14 annually from 2006-2008, and 13 in just the first six months of 2009, says PwC, which on Monday issued a report on the topic. For their part, CFOs should be especially concerned about the stepped-up enforcement because they are "signing off on certifications saying that their financial reports are truthful and accurate," said Wendy Wysong, a partner at the law firm Clifford Chance, referring to CFOs' personal liability for honest corporate reporting under the Sarbanes-Oxley Act. "And the compliance function is often within the CFO's responsibilities, which should be another huge concern." […] Judging from a recent survey by Deloitte, companies are getting the message about the need for increased vigilance on potential bribery violations.

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