{"id":5596,"date":"2023-10-13T00:12:32","date_gmt":"2023-10-13T05:12:32","guid":{"rendered":"https:\/\/blogs.luc.edu\/compliance\/?p=5596"},"modified":"2023-10-13T00:12:32","modified_gmt":"2023-10-13T05:12:32","slug":"bribery-here-to-stay","status":"publish","type":"post","link":"https:\/\/blogs.luc.edu\/compliance\/?p=5596","title":{"rendered":"Bribery: Here to Stay"},"content":{"rendered":"

Anokhi Manchanda<\/em><\/span><\/p>\n

Associate Editor<\/em><\/span><\/p>\n

Loyola University Chicago School of Law, JD 2025<\/em><\/span><\/p>\n

 <\/p>\n

Earlier this year, Morgan Lewis and Compliance Week conducted a survey<\/a> on anti-bribery and corruption efforts by compliance professionals. The results of the survey showed that there are not enough resources to combat recent trends in bribery<\/a>. Recently, there have been multiple million-dollar settlements regarding bribery<\/a> claims.\u00a0<\/span><\/p>\n

Compliance Week and Morgan Lewis Survey Report <\/strong><\/span><\/p>\n

Compliance Week and Morgan Lewis conducted a survey<\/a> with responses from 154 compliance practitioners on their anti-bribery and corruption efforts. The compliance professionals worked in companies ranging<\/a> in specialization from financial services to technology. Over 57% of the companies had a few thousand<\/a> employees and some practitioners surveyed came from companies with revenues as high as $10 billion. In the information gained from this survey, one statistic relayed that 82%<\/a> of those surveyed said indirect bribery by a third party posed a greater risk than bribery by internal personnel. In the next 2-3 years, 48%<\/a> of the practitioners said that bribery and corruption risks would increase, while 39% said the risks would remain the same.<\/span><\/p>\n

Notably, the survey revealed that human, technology, and financial resources within their companies were inadequate<\/a> to fight bribery and corruption practices. Only 33% of practitioners felt confident that their company\u2019s financial controls would catch<\/a> potential books-and-records violations, with 40% being somewhat confident. A partner at Morgan Lewis stated that companies have to do the most<\/a> due diligence with third-parties in order to end corruption. But only 12%<\/a> of practitioners said their company audits more than 10% of high-risk third parties annually. 33%<\/a> of companies audited 0% of high-risk third parties annually. The results of this survey not only demonstrated that the resources to fight bribery and corruption are insufficient, but the compliance practitioners of those companies do not have much faith<\/a> in the resources their companies have currently. This is a cautionary tale for the bribery settlements to come.<\/span><\/p>\n

Albemarle\u2019s $218 million settlement <\/strong><\/span><\/p>\n

Albemarle<\/a> is a company that global producer of catalyst solutions and performance chemicals such as lithium. In 2018, the SEC requested the company to disclose their financial payments<\/a> from 2009 to 2017. Those documents revealed that third-party sales representatives and employees of Albemarle\u2019s subsidiaries conspired to bribe<\/a> officials in Vietnam, Indonesia, and India to acquire and retain business with oil refineries in those countries. The company gained around $98.5 million<\/a> as a result of the bribery. Albemarle said that those who partook in the criminal acts back then were punished<\/a>. But the company is expected to pay around $218.5 million<\/a> as a fine to settle the investigation as the SEC stated that the exchange of currency violates the Foreign Corrupt Practices Act.<\/span><\/p>\n

Clear Channel Outdoor pays $26 million <\/strong><\/span><\/p>\n

The SEC is also investigating a company<\/a> in the media industry for bribery. Clear Channel Outdoor had to pay for a settlement due to lavish gifts<\/a> given to Chinese government officials in China by a Chinese subsidiary of this Texas-based company. This subsidiary alleged gave gifts such as golf clubs, hotel rooms, meals, vases, and other costly items to the officials by themselves and with the help of third parties in order to get contracts<\/a> for advertisement space on bus shelters, billboards, and street furniture. Although Clear Channel\u2019s own auditors<\/a> raised red flags about the improper payments, Clear Channel continued to make them. In 2018, the company communicated with the SEC<\/a> and disclosed a related investigation to their investors. Their settlement with the SEC is about $26 million<\/a>, which includes some of their profit from the schemes.<\/span><\/p>\n

Moving forward<\/strong><\/span><\/p>\n

As per the report from the survey conducted by Morgan Lewis and Compliance Week, there needs to be more resources put in place to combat bribery and corruption. In its promotion of justice, I have found that sometimes there is a misconception that the United States appears to be more fair than other countries in terms of acting fairly in business dealings. But in this case, U.S. companies are going into other countries and are engaging in bribery. In some sense, resources are needed to combat the corrupt practices, but it is possible that a larger shift in mindset is important. The survey report was especially helpful because it shed light on those practices and people\u2019s opinions on the existence of bribery and corruption today. The SEC should regulate companies so that they are auditing more percentages of high-risk third parties annually. In doing so, companies can stay vigilant and combat bribery and corruption more actively.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

Earlier this year, Morgan Lewis and Compliance Week conducted a survey on anti-bribery and corruption efforts by compliance professionals. The results of the survey showed that there are not enough resources to combat recent trends in bribery. Recently, there have been multiple million-dollar settlements regarding bribery claims.\u00a0<\/p>\n","protected":false},"author":138,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[186,527,1788],"class_list":["post-5596","post","type-post","status-publish","format-standard","hentry","category-uncategorized","tag-anti-bribery","tag-corruption","tag-sec"],"_links":{"self":[{"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=\/wp\/v2\/posts\/5596","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=\/wp\/v2\/users\/138"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=5596"}],"version-history":[{"count":0,"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=\/wp\/v2\/posts\/5596\/revisions"}],"wp:attachment":[{"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=5596"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=5596"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.luc.edu\/compliance\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=5596"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}