Compliance Isn’t Political

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Post By: Adam Turteltaub

Every time there’s a change in Administration in Washington there’s a new rush of speculation about compliance programs. Are there going to be more prosecutions or less? Does this mean business can ease up on compliance, or should it be more vigilant?

On December 4 we saw two strong pieces of evidence that this discussion is no longer worth having. The need for compliance programs continues and will likely grow no matter who is in the White House.

Let’s start with the Foreign Corrupt Practices Act. During the Obama Administration there were a series of very large cases and massive settlements. With the coming of the Trump Administration, there were some who thought that US enforcement in this area would wane, and that companies could ease off on their considerable investment in compliance.

But enforcement continued and on December 4, the Wall Street Journal reported that the Department of Justice’s enforcement of the FCPA had reached a new high. As the journal wrote, “Authorities in the U.S. and elsewhere this year have imposed about $7.76 billion in penalties globally for foreign bribery misconduct.”

To be fair, a large portion of those fines went to the UK and French governments, not the US government. But, also to be fair, those countries now have their own regimes calling for compliance programs.

That raises an important note to remember: The Department of Justice isn’t the only sheriff in town. Foreign governments are both increasing their enforcement of anticorruption laws and providing their own guidance and expectations for compliance programs. And, of course, these governments are taking action without looking at who’s in the White House.

Back to the US side, it also is worth noting that enforcement of the FCPA stepped up dramatically under the George W. Bush presidency and has continued ever since. Despite two changes in presidents and parties in power, strong FCPA enforcement has continued.

The second telling piece of evidence of the continuous, growing need for compliance programs: Also on December 4 the US Department of Health and Human Services announced the creation of a new False Claims Act Working Group, designed to enhance “its partnership with the Department of Justice (DOJ) and the HHS Office of Inspector General (OIG) to combat fraud and abuse by identifying and focusing resources on those who seek to defraud the American taxpayers.”

Even with a transition in Administrations beginning, the effort to ensure compliance continues and the need for compliance programs remains.

So, what does this mean for compliance programs? While each Administration in Washington brings its own touch to enforcement and likely some change in emphasis, the underlying, foundational need for compliance programs is not going to change. There is less and less tolerance for organizational wrongdoing, both in the US and globally, and a steadily increasing need for effective compliance and ethics programs.

The bottom line: when it comes to compliance, it’s best not to worry who’s in the White House and instead focus on what’s going on in your organization’s house.