The Art of Compliance
David R. Jackson is a compliance manager, and has been for over twenty years. As a consequence, he knows better than anyone the delicate balancing act being a compliance professional requires.
Compliance leadership within a business requires maintaining five different conversations concurrently: (1) with the business, (2) with senior management, (3) with other teams that support the business, (4) with the government agencies and industry groups that provide external oversight, and (5) with the compliance staff. The challenge is not carrying out any one conversation, but juggling all conversations at the same time, and constantly shifting gears between conversations with different audiences.
In the midst of countless sexual misconduct allegations against some of Hollywood’s most powerful people, on November 9, 2017, Los Angeles District Attorney, Jackie Lacey, issued a statement outlining a plan of action. A special task force of veteran sex crimes prosecutors has been assembled to ensure a “uniformed approach to the legal review and possible prosecution of any case that meets both the legal and factual standards for criminal prosecution.” The Beverly Hills and Los Angeles Police Departments are conducting investigations of the accused as a rapidly increasing volume of sexual misconduct allegations are reported. Law enforcement and the special task force prosecutors are faced with legal and factual difficulties before any sexual misconduct allegations are sufficient for criminal prosecution. The legal elements of the alleged crime, the specific facts of each allegation, the existence of physical evidence, and the remedies available to the victims, are among the many convoluted factors that will dictate the ongoing investigations and prosecution of the allegations that are flooding Hollywood.
The IRS suspended its Automatic Substitute for Return (ASFR) Program for lack of resources, Tax Analysts and others report. The ASFR program has long provided an avenue for the IRS to assess taxes on delinquent filers after requests to file returns were ignored by having its computer system automatically calculate the tax due based on Forms 1099 and other information reports that had been filed with the IRS. The IRS could then assess the taxes and attempt to collect based on these substitute returns. However, since deductions were ignored, the tax amounts tended to be inflated, sometimes incredibly so, and significant IRS time was required to respond to contested assessments and collection efforts that were sometimes highly unrealistic.
The Chief Compliance Officer (“CCO”) plays a vital role in in the business of broker dealers and investment advisors. Following the financial crisis, firms hired compliance officers in droves to help repair vulnerabilities in firm policies and to address emerging regulation. As regulatory complexity and demand for compliance professionals grew, firms looked to consultants, contractors and lawyers to help fulfill specialized compliance functions. Can an unaffiliated third party effectively fulfill the Chief Compliance Officer role?
I’m excited to announce that we have released the second issue of the Journal of Regulatory Compliance!
Issue II begins with a reflection on compliance education at Loyola University Chicago School of Law from our own previous Executive Editor, Ryan Whitney; followed by an analysis of compliance and ethics issues with third-party vendor relationships from the Columbia School of International and Public Affairs’ own Michael Silverman. Jennifer Mascott, an expert in administrative and Constituional law from George Washington , contributed a discussion of the status of administrative law judges of the U.S. Securities and Exchange Commission as “Officers of the United States.” Last but certainly not least is a critique of financial and securities enforcement against compliance personnel by Erica Skoczylas. Journal of Regulatory Compliance Editor-in-Chief Ryan Meade rounds out the set, with an afterword introducing some of the themes and concepts that will be explored in Issue III.
I had a wonderful time working with our distinguished authors to bring the publication to you as readers today. I hope you enjoy our insightful author’s analyses and insights.
The academic year for 2017-2018 has begun at the Center for Compliance Studies. We have a lot on tap—a new look for the blog, an exciting symposium in February 2018, Issue 2 of the Journal soon to be published, and a number of new scholarly endeavors.
Compliance programs rely heavily on internal investigations. Yet unlike their counterparts in the in-house counsel’s office, compliance professionals rarely give notice when they are conducting such investigations. Whether compliance professionals have duty to notify individual directors, officers and employees of an internal investigation remains unclear. This lack of clarity leads to confusion with employees and officers regarding the limits of confidentiality, and the compliance officer’s duty of loyalty. A robust ethics and compliance program should therefore take a proactive stance and integrate Upjohn warnings—a standard of corporate counsel, but modified to fit the compliance function—into the internal investigation process.
Brittany Tomkies Executive Editor Loyola University Chicago School of Law, JD 2017 Over the past decade, risk management and compliance professionals have moved away from asking “what happened” and “who did it” to asking “why” the error occurred in hopes of developing effective safeguards to prevent reoccurrence of those errors. As a result of …
Ryan Whitney Managing Editor Loyola University Chicago School of Law, JD 2017 With the chaotic 2016 behind us and 2017 underway, many people are working to maintain the resolution(s) they set for themselves to ensure that last year’s failures are not repeated. Sadly, more than a quarter of us have already broken these resolutions …
Fannie Fang Executive Editor Loyola University Chicago School of Law, JD 2017 CMS has reported that Medicare expenditures amount to roughly 17 billion a year on patient readmissions alone. Studies show that almost twenty percent of all patients who are admitted to a U.S. hospital makes a repeat visit within thirty days of discharge. …