Small & Mid-Sized Companies Should Take Notice Of The Increase In SEC Crackdown

Small & Mid-Sized Companies Should Take Notice Of The Increase In SEC Crackdown

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Doing #business globally is risky. So is not having or improving you #anticorruption program.

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Tuesday, March 17, 2015 - 7:10pm

CONTENT: Article

It is no secret that the Securities and Exchange Commission (SEC) has not lessened the amount of enforcement when investigating FCPA allegations. As we’ve seen in 2014, one of the largest collections of fines in recent history, the SEC has no intentions of slowing down its pressure on FCPA violators. As companies begin to expand globally, they are increasing their risk of exposure to corruption and bribery acts. For many companies, in order to expand business relations in other regions worldwide, they are required to work with agents that are within the local area. This is then known as your 3rd party business partner and as a partner they need to be held to the same FCPA and OECD standards as any other person that represents your organization. This poses a threat, as it is difficult to account for the actions taken by 3rd party business partners and their suppliers. Under the FCPA, companies using 3rd parties to conduct business abroad are still held liable for their actions.  In an article written by Nicholas E Williams of the National Law Review, the chairmen of the SEC mentions that the fines issued in 2014, should be a wake up call for those doing business internationally:

 “This is a wake-up call for small and medium-size businesses that want to enter into high-risk markets and expand their international sales,”

Larger organizations have the budget and the human resources to increase their efforts and comply with FCPA standards in a timely manner. What about small to mid-sized companies that have a more difficult time getting these resources together?

For any company, the excitement of extending operations abroad, for the increase of your companies reach, is very big, but so is the potential for corruption risk. With a lot of information available to the public, it is difficult to identify which piece of information is most relevant to you and your company.

Based off of our 7 key categories for a complete anti-corruption program, Source Intelligence powered by CREATe has compiled a series of guidelines that follows the FCPA and OCED framework for a comprehensive anti-corruption compliance program. If you are either beginning or improving your anti-corruption program, these guidelines could serve as great reference for you. To receive the 2015 Anti-Corruption Guidelines click here.