Anti-Corruption 101: What you Need to Know to Avoid Corrupt Practices

Anti-Corruption 101: What you Need to Know to Avoid Corrupt Practices

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Anti-Corruption 101: What you need to know to avoid corrupt practices
Thursday, November 13, 2014 - 11:30am

CONTENT: Article

What do we really know and understand about corruption? How do we track and monitor corruption related issues? With the expansion of globalization and industries being able to reach greater lengths, the possibility of corrupt practices seeping through the cracks is a potential risk. In previous times it was a risk that could be monitored from internal resources and could be done correctly when done diligently. With growing companies and growing markets, what seemed to be a doable task before is quickly becoming more difficult and harder to manage now.

Since the growing number of corruption cases within developed and developing countries is rising, the concern of having a solid and impactful anti-corruption compliance program is becoming more forthcoming. The growth of major corporations only puts them much more at risk; as they deal with more 3rd party service providers, it opens them up to more vulnerability and potentially leading to their internal structure.  Under the Foreign Corrupt Practices Act (FCPA) and other similar Acts, companies are not only liable to have strong internal programs; they are legally liable for their business partners, agents, and suppliers.

This new level of monitoring takes enormous amounts of time and effort to complete. Now that companies are required to watch over entities they are doing business with, this only makes it much more harder to create a solid anti-corruption compliance program. As you open yourself up and your company to larger business opportunities, you are also opening the door to possible corruption activity if not monitored correctly and efficiently.

The top 5 extremely limiting factors in creating a quantifiable and reliable anti-corruption program is: time, cost, staff/expertise, information and linguistic ability. A list of this magnitude can create headaches for any industry that is trying to safe guard themselves and their assets from possible entry point of corruption.

Of course the greatest FCPA exposure is within 3rd party interaction. 90 percent of FCPA cases against corporations during a one-year period involved payments made by third parties (business partners, agents, and suppliers) According to a Senior FCPA Prosecutor, FCPA authorities’ expect a third-party due diligence should be:

“Robust, thorough, impeccably documented and preserved”

When dealing with 3rd party (external) vulnerabilities, you now focus on agents, business partners, suppliers, acquisitions, and joint ventures.

So ultimately how do you safeguard yourself and prepare a quality anti-corruption compliance program? Communication and education is key; At Source Intelligence the primary focus is looking at your existing plan and comparing it to others that are similar to your industry. As we are able to assess the strengths and weaknesses of the program, we are able to obtain key insights while providing exclusive bits of information to help formulate and anti-corruption solution.

With the rise of this worldwide issue, Source Intelligence powered my CREATe, is offering a limited number of available openings to assist in identifying corruption vulnerabilities. With an analysis from Source Intelligence, it is a prime opportunity to obtain industry knowledge, industry leading expertise, and thorough evaluation.  If you would like to participate please use this link.