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Bribery and Corruption: Navigating the Global Risks

Bribery and Corruption: Navigating the Global Risks

Brian P. Loughman, Richard A. Sibery

ISBN: 978-1-118-16620-8

Oct 2011

432 pages



As businesses continue to expand globally into new and emerging markets, bribery and corruption risks have increased exponentially. Bribery and Corruption offers a comprehensive look at this growing problem, and at the Foreign Corrupt Practices Act (FCPA) and other international anti-bribery and corruption conventions. Presenting hypothetical examples of situations companies will face, along with practical solutions, the book offers detailed global guidance on a region and country-specific basis.

The FCPA prohibits US companies and their subsidiaries from bribing foreign officials, either directly or indirectly through intermediaries, for the purpose of obtaining or retaining business. It also requires companies to keep accurate records of all business transactions and maintain an effective system of internal accounting controls. Internationally, the Organization of Economic Cooperation and Development's (OECD's) anti-bribery convention has been adopted by 38 countries and creates legally binding standards related to bribery of foreign public officials.

Written by renowned accounting fraud experts Richard A. Sibery and Brian P. Loughman, and providing an introduction and overview of the Foreign Corrupt Practices Act (FCPA) and international bribery laws, Bribery and Corruption considers:

  • How to conduct FCPA risk assessments and investigations
  • How to consider FCPA specific financial controls
  • How to implement an FCPA compliance program and how to measure FCPA compliance

The risk of bribery and corruption continues to be an area of concern for companies around the world, but armed with Bribery and Corruption, it is easier than ever to understand the challenges that exist and how to deal with them.

Foreword xi

Preface xiii

Chapter 1: Introduction 1

Enforcement Trends 4

Anti-Corruption Compliance Programs 6

Remember the Purpose 6

Notes 7

Chapter 2: Overview of FCPA 9

Legislative History 11

Overview and Key FCPA Statutory Elements 12

Ancillary Statutes 22

Summary 25

Notes 25

Chapter 3: The U.K. Bribery Act and International Bribery and Corruption Initiatives 29

U.K. Bribery Act of 2010 30

Global Anti-Corruption Initiatives 34

Summary 42

Notes 43

Chapter 4: Compliance Programs 47

Goals of an Effective Anti-Corruption Compliance Program 48

Accepted Standards and Guidance 48

What Should an Anti-Corruption Program Include? 64

Summary 72

Notes 73

Chapter 5: Policies and Procedures 75

Bribery, Corruption, and Fraud Prevention Policies 76

Communication and Training 80

Internal Financial Controls 86

Summary 111

Notes 111

Chapter 6: Risk Assessments 113

Scoping the Risk Assessment 117

Conducting the Risk Assessment 120

Gap Analysis 125

Reporting 126

Documenting the Risk Assessment 127

Summary 127

Notes 127

Chapter 7: Monitoring 129

Building an Anti-Corruption Monitoring Program 130

Conducting the Anti-Corruption Compliance Audit 134

Reporting the Results 139

Audits of Agents/Intermediaries 141

Use of Data Analytics in Monitoring 142

Summary 151

Notes 151

Chapter 8: Anti-Corruption Due Diligence 153

Current Transaction Market Perspectives 154

The FCPA Due Diligence Regulatory Environment 157

Why Is Anti-Corruption Due Diligence Significant? 159

Unique Considerations of Anti-Corruption Due Diligence 163

What to Do When Violations Are Found During Anti-Corruption

Due Diligence 173

Summary 174

Note 175

Chapter 9: Investigations 177

Trigger Events 178

Triage 180

Response 186

Remediation 222

Summary 224

Notes 224

Chapter 10: Regional Considerations for Bribery and Corruption Risks 225

Asia-Pacific 225

Europe 237

India and South Asia 251

Middle East 259

Africa 267

Latin America 274

Notes 286

Contributors 292

Chapter 11: Industry Considerations for Bribery and Corruption Risks 295

Aerospace and Defense 296

Automotive 304

Construction and Real Estate 311

Consumer Products 318

Diversified Industrial 323

Energy 328

Financial Services 335

Life Sciences 341

Media and Entertainment 348

Mining and Metals 354

Retail and Wholesale 361

Technology 366

Transportation 373

Notes 381

Contributors 383

Acknowledgments 387

About the Authors 389

About the Contributors 391

Index 395