FCPA 3rd party relationships

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  • KEY POINTSThe first 10 days are critical – define the case strategy with clarity and convictionBy knowing what the case is about and who to collect and investigate EARLY.Case strategy is KEY – dismiss, settle, contest – allocate budget and resources
  • KEY POINTSThe first 10 days are critical – define the case strategy with clarity and convictionBy knowing what the case is about and who to collect and investigate EARLY.Case strategy is KEY – dismiss, settle, contest – allocate budget and resources
  • FCPA 3rd party relationships

    1. 1. Copyright © 2011 Catelas Inc. All rights reservedFCPA 360 degree How corrupt is your international business? FCPA compliance
    2. 2. Copyright © 2011 Catelas Inc. All rights reservedFCPA 360 degree The spotlight is on 2010: 50 individuals had been charged and nearly $2 billion collected from FCPA 2005: 5 individuals and roughly $16.5 million collected 0 1 2 2009 2010 FCPA $ Billions • Huge press exposure, both USA FCPA & UK Bribery Act • Criminal liability for company executives • SEC ‘whistle-blower incentives
    3. 3. Copyright © 2011 Catelas Inc. All rights reservedFCPA 360 degree The real cost of FCPA violations ITT $12B total revenues; 40,000 employees $5B in government contracts; F500 FCPA – China payments case DCAA audit $0.5M Fine $1.7M Legal Fees $4.0M Post-case monitoring $1.5M TOTAL COSTS $7.7M Estimated Costs Press reports show a fine of $1.7M but the real cost to ITT could easily be in excess of $10M (not including business opportunity cost) ITT was fined $1.7M for allegedly paying Chinese officials for the sale of water pumps. They were accused of paying $200k in bribes for business worth $4M and after- tax profits of $1M
    4. 4. Copyright © 2011 Catelas Inc. All rights reservedFCPA 360 degree The ProblemHow responsive are you? Are your investigations something like this? Slow, disruptive & ineffective Any Investigation ... • Involves many organizations, languages • Collection alerts organization (leads to cover-up) • Who is key? Who have we missed? • Time is money – the longer this drags on, the more it costs
    5. 5. Copyright © 2011 Catelas Inc. All rights reservedFCPA 360 degree The ProblemA new paradigm Faster, smarter, more effective investigations • Insight into entire company (not just who you think might be involved) • Non-disruptive (investigate before collection and interviews) • Provide Case Intelligence within days not weeks • Prioritize most important investigations Don’t wait until it’s too late… • Get ahead • Periodically review your foreign business relationships • Compliance peace of mind
    6. 6. Copyright © 2011 Catelas Inc. All rights reservedFCPA 360 degree 360 degree Assessments Multiple Deployments 360 degree Assessments • Get insight into ‘trouble’ regions • Non-disruptive (investigate before collection and interviews) • Assess key business relationships • Gain compliance ‘peace of mind’ What relationships do we have in Country X ?
    7. 7. Copyright © 2011 Catelas Inc. All rights reservedFCPA 360 degree How often do we need these 360 assessments? Typically 1 or 2 times a year… or as the business dictates … such as… • Unbelievable sales growth in Brazil? • New R&D trials in China? • New oil exploration contracts in Nigeria? • etc
    8. 8. Copyright © 2011 Catelas Inc. All rights reservedFCPA 360 degree What is involved? Fast, comprehensive, effective and non-disruptive • These are not detailed audits of Financials • They are not in-country, covert investigations • They are not reviews of your partnership programs They are a … comprehensive review of how your company conducts its international business operations
    9. 9. Copyright © 2011 Catelas Inc. All rights reservedFCPA 360 degree Live DemoDemo
    10. 10. Copyright © 2011 Catelas Inc. All rights reservedFCPA 360 degree Thank You Robert Levey 978 996 2758 robert.levey@catelas.com www.catelas.com

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