Is compliance failing?
Friday, September 21, 2018 at 8:28AM
Richard L. Cassin in Brazil, Keppel FELS, Singapore, Telia, Theranos, Uber, VimpelCom, Volkswagen, Wells Fargo, Wikileaks

During most interviews, I'm asked this question or something like it: More companies than ever have compliance programs. Yet huge scandals keep making headlines. What gives?

To be fair, there's plenty of evidence that compliance has failed: Volkswagen cheated on diesel emissions tests. Wells Fargo opened millions of unauthorized bank accounts. Barclays Bank rigged interest rates -- then, on orders from the CEO, hunted down an internal whistleblower.

Uber "greyballed" some customers so they wouldn't see it violating local laws. Mylan price-gouged the public with its Epipen. Theranos was a top-down blood-testing sham.

In the FCPA world, Telia, VimpelCom, and SocGen bribed their way to business growth. Even Keppel Offshore & Marine from squeaky clean Singapore was into big-time graft in Brazil.

But do those headlines, as bad as they are, prove that compliance has failed?

Not at all. As more companies join the global supply chain and adopt best practices, there's more compliance in the world, not less.

Why, then, are there so many bad headlines? The reason is because it has never been easier to expose fraud and corruption, or harder to hide it.

Two authors for the FCPA Blog -- Alison Taylor and James Cohen -- have described our time as the “age of hyper transparency.”

They're right. In today's culture, everyone is a potential whistleblower.

At the SEC, 57 whistleblowers have collected more than $320 million as a reward for exposing corporate wrongdoing.

At a law firm, one super-whistleblower downloaded and shared more than 11 million documents about secret offshore companies and bank accounts. Those documents became known as the Panama Papers.

We all have instant access to public-record databases that we can cross check and compare.

Banks, money changers, and casinos have to report "suspicious transactions" -- those that could involve money laundering, bribery, tax evasion, or other crimes.

WikiLeaks -- remember them? -- collects and publishes . . . well, anything.

Hyper transparency makes it harder to hide graft and easier to expose it. So yes, we see more bad headlines, and naturally we believe there's more corruption, not less.

Still, no one can measure the amount of actual bribery in the world. Whether or not there's more or less is debatable.

But we can all see that more companies have compliance programs. And because hyper transparency increases the chances of bribe payers getting caught, we know there's more incentive than ever to keep things clean.

All the bad headlines aren't a failure for compliance. They're a victory for transparency.


Richard L. Cassin is the publisher and editor of the FCPA Blog.

Article originally appeared on The FCPA Blog (
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