Fraud Advisory Panel have set up a COVID-19 fraud watch group

The Fraud Advisory Panel have set up a COVID-19 fraud watch group.  A cross-sector and cross-industry coalition of trusted partners (including the Cabinet Office and City of London Police) who meet weekly to share information on emerging fraud threats and trends affecting business. The panel aims to act as a conduit to warn the public, private and third sectors about COVID-19 fraud risks. In addition to supply  preventative actions that can be taken.

Measures announced over recent months to deal with COVID-19 have seen our day-to-day life drastically changed forcing us to spend more time at home and online. Unfortunately, criminals are using every opportunity they can to scam innocent people and businesses. GOV.UK has also released advice and guidance on how to protect yourself and your business from fraud and cyber crime. This guidance explains simple steps you can take to protect yourself and your business against fraud and cyber crime and where to get help. The National Cyber Security Centre has also published advice on how to spot COVID-19 scams and keep remote working safe.

If you think you’ve been scammed or you’ve found something which looks like fraud or a scam, contact Action Fraud.

Staying one step ahead of any critical risk to your organisation is part of being an effective business leader. For assistance in developing and implementing a fraud prevention strategy, contact us today or get a FREE QUOTE now!

Have you read?

• Brexit poses new bribery challenges, ISO 37001 provides solutions
• Bribery and corruption plague Middle East, how can ISO 37001 help?
• As South Asia Grapples with anti-bribery compliance, ISO 37001 provides solutions
• Whitepaper: Organised catastrophe of international Pakistan airlines
• Rolls-Royce Case study: Ethics & Compliance
• ISO 37001 FAQ
• Are you ready for ISO 37001?
• Don’t have an ethical code of conduct? Your organisation needs one

Who is CRI Group?

Filed under: Anti-Bribery Anti-Corruption Solution, Compliance Solution, COVID-19 Insights, Due Diligence, ISO 37001, Pakistan, Islamabad, Pakistan, Karachi, Qatar, Doha, Resources, Shanghai, Singapore, Singapore, United Arab Emirates, Abu Dubai, United Arab Emirates, Dubai, United Kingdom, London, United States of America, New York by admin
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5 Tips for Preventing & Detecting Expense Fraud

It’s one of the most common forms of occupational fraud: employees fudging on their expense accounts. In June, 2020, Lookers (London-listed company) warned investors they might be unable to buy and sell its shares from the beginning of July because of potential fraud on its books – confirming £19m charge to correct books after fraud inquiry. Whether through fictitious charges, fake receipts or invoices, or other improper use of expense funds, an expense account is sometimes seen as a low-risk, high-reward area for committing fraud. It shouldn’t be. If your company takes the proper steps to review expense activity and protect itself from fraud, expense accounts will no longer be a vulnerable area of your finances.

The experts at CRI® Group offer the following tips for bolstering your protection against expense account fraud:

1. Provide strict guidelines for credit card use

Often, expense account fraud is committed with the use of a credit card, with the employee seeking illegitimate reimbursement for various expenses. Detail how personal cards are allowed to be used, and require and review all receipts for claimed expenses. Also require supporting documentation (such as an airline boarding pass, for example) to ensure the purchase was used as intended.

2. Check company credit card statements carefully

In some cases, employees will use a company credit card to make a purchase, but then claim similar or duplicate expenses for reimbursement on their expense report. This is easy to catch if you carefully review company card statements and check them against reimbursements.

3. Ask questions

If a purchase seems odd or unrelated to business use, catching it early is the best way to resolve the issue. After too much time has passed, an employee might claim to have a difficult time remembering exactly what the questionable expense was for. If in doubt about a claim, ask for supporting documentation and a clear explanation of how the expense was used for a business purpose.

4. Implement a Code of Ethics for all employees

By including anti-fraud language in your Code of Ethics, which should communicate a strong anti-fraud stance and be signed by all employees, it will be clear that expense account fraud is not tolerated. Reinforce this with regular communications to employees reminding them that the company does not tolerate fraud in any form and offenders will be prosecuted.

5. Set a Tone at the Top

If the company has rules in place but senior staff aren’t following them, lower-level employees will follow by example and flout the rules, as well. All staff should follow the rules to the letter. Especially while on business trips with lower level employees, senior staff should set a positive example and make a point to follow the rules for business expenses.

Expense account fraud is a persistent problem in business, but it doesn’t have to be a crisis at your company. By using a common sense approach and some key prevention strategies, you can help ensure that your employees know the rules and are less likely to try to take advantage of company expense funds. For assistance in developing and implementing a fraud prevention strategy, contact us today or get a FREE QUOTE now!

Let’s Talk!

Based in London, CRI® Group works with companies across the Americas, Europe, Africa, Middle East and Asia-Pacific as a one-stop international Risk Management, Employee Background Screening, Business Intelligence, Due Diligence, Compliance Solutions and other professional Investigative Research solutions provider. We have the largest proprietary network of background screening analysts and investigators across the Middle East and Asia. Our global presence ensures that no matter how international your operations are, we have the network needed to provide you with all you need, wherever you happen to be. CRI® Group also holds BS102000:2013 and BS7858:2019 Certifications is an HRO certified provider and partner with Oracle.

In 2016, CRI® Group launched the Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management Systems, ISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification. ABAC® operates through its global network of certified ethics and compliance professionals, qualified auditors and other certified professionals. As a result, CRI® Group’s global team of certified fraud examiners work as a discreet white-labelled supplier to some of the world’s largest organizations. Contact ABAC® for more on ISO Certification and training.

MEET THE CEO

Zafar I. Anjum is Group Chief Executive Officer of CRI® Group (www.crigroup.com), a global supplier of investigative, forensic accounting, business due to diligence and employee background screening services for some of the world’s leading business organizations. Headquartered in London (with a significant presence throughout the region) and licensed by the Dubai International Financial Centre-DIFC, the Qatar Financial Center – QFC, and the Abu Dhabi Global Market-ADGM, CRI® Group safeguard businesses by establishing the legal compliance, financial viability, and integrity levels of outside partners, suppliers and customers seeking to affiliate with your business. CRI® Group maintains offices in UAE, Pakistan, Qatar, Singapore, Malaysia, Brazil, China, the USA, and the United Kingdom.

Contact CRI® Group to learn more about its 3PRM-Certified™ third-party risk management strategy program and discover an effective and proactive approach to mitigating the risks associated with corruption, bribery, financial crimes and other dangerous risks posed by third-party partnerships.

CONTACT INFORMATION

Zafar Anjum, MSc, MS, CFE, CII, MICA, Int. Dip. (Fin. Crime) | CRI® Group Chief Executive Officer

37th Floor, 1 Canada Square, Canary Wharf, London, E14 5AA United Kingdom

t: +44 207 8681415 | m: +44 7588 454959 | e: zanjum@crigroup.com

Filed under: Anti-Bribery Anti-Corruption Solution, Background Investigation, Business Intelligence, Compliance Solution, Insurance Fraud Investigation, Pakistan, Islamabad, Pakistan, Karachi, Resources by admin
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Fight Fraud with ABMS Certification

Fraud, bribery and corruption cause serious harm to business. They can have a major financial impact, damage an organization’s hard-earned reputation and destroy company culture. That’s why at CRI® group we focus on helping organizations address these risks – as a team effort. All fraud, bribery and corruption (collectively referred to as economic crime) is unacceptable and should not be tolerated by any organization. It affects the ability of any business to thrive and it can cost them billions. A good example is NHS.

The NHSCFA 2018/19 Business Plan estimates that £1.29 billion could be lost to economic crime from the NHS in England on an annual basis. This estimate includes losses across NHS Providers and CCGs, as well as NHS England and further detail is provided in the NHSCFA Strategic Intelligence Assessment (SIA).

According to the Association of Certified Fraud Examiners (ACFE), “Tone at the Top” – the ethical atmosphere that is created at an organization or in a workplace by the attitudes and behaviors of an organization’s leadership – is a major factor in determining whether fraud, bribery or corruption is likely to take place. That’s because employees lead by example. If their leaders show a strong, zero-tolerance approach to fraud, those who report to them are likely to follow. In fact, the ACFE’s research shows that the most common determinants of ethical behavior in the workplace are the following:

• Behavior of superiors
• Behavior of peers
• Industry ethical practices
• Society’s moral climate
• Formal organizational policy

There is also evidence that a company’s own employees are its best protection against fraud. Statistics show that most fraud is detected by internal tips, even more than audits and other methods. That means that employees are recognizing fraud, understanding that it’s wrong and not acceptable at their workplace, and reporting it.

So it stands to reason that the more trained and educated a workforce is about fraud, bribery and corruption, the better that organization will operate as a team in preventing and detecting those behaviors.

CRI® Group launched Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management Systems, ISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification.

ABAC® Center of Excellence uses this approach as a focal point in providing the training and knowledge your organization needs to prevent fraud, bribery and corruption. Our experts tailor a program to your organization’s needs, accommodating every level of your organization to ensure that certification is a team effort among your employees.

Certification addresses Tone at the Top by ensuring that an organization’s governing body and top management are exercising appropriate oversight and meeting all legal requirements. But it also does so much more. The ISO 37001:2016 Anti-Bribery Management System certification empowers you with the ability to safeguard and maintain the integrity of your company by:

• Guaranteeing that all workers and agents are devoted to the latest anti-bribery practice.
• Regularly validating compliance to appropriate legislation like the FCPA and UK Bribery Act 2010
• Jointly cooperating with stakeholders to observe and reduce the risks throughout your supply chain
• Externally scrutinizing your company, testing the effectiveness of your anti-bribery policies and processes
• Ensuring compliance in action

Most of all, ABAC® certification will help your organization come together, united in efforts to prevent fraud, bribery and corruption. When financial losses begin to reverse and the organization shows improved financial health, each employee will understand how their individual effort and attitude has helped make a positive difference in the fortunes of the company.

The ABAC® teaches that. It also increases employee pride and morale. Most of all, it demonstrates to staff that leadership supports them and will have their backs when it is time to do the right thing.

Nobody wants to feel they are on an island. Don’t delay on getting your organization started on the path to certification today.  ISO 37001:2016 Anti-Bribery Management System certification is offered under CRI® Group’s ABAC® Centre of Excellence, an independent certification body established for Anti-Bribery Management System training and certification, ISO 37301 Compliance Management Systems and Risk Management System certification. The program will be tailored to your organization’s needs and requirements. For assistance in developing and implementing a fraud prevention strategy, contact ABAC® today or get a FREE QUOTE now!

About us…

Based in London, CRI® Group works with companies across the Americas, Europe, Africa, Middle East and Asia-Pacific as a one-stop international Risk Management, Employee Background Screening, Business Intelligence, Due Diligence, Compliance Solutions and other professional Investigative Research solutions provider. We have the largest proprietary network of background screening analysts and investigators across the Middle East and Asia. Our global presence ensures that no matter how international your operations are, we have the network needed to provide you with all you need, wherever you happen to be. CRI® Group also holds BS102000:2013 and BS7858:2019 Certifications is an HRO certified provider and partner with Oracle.

In 2016, CRI® Group launched the Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management Systems, ISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification. ABAC® operates through its global network of certified ethics and compliance professionals, qualified auditors and other certified professionals. As a result, CRI® Group’s global team of certified fraud examiners work as a discreet white-labelled supplier to some of the world’s largest organizations. Contact ABAC® for more on ISO Certification and training.

MEET THE CEO

Zafar I. Anjum is Group Chief Executive Officer of CRI® Group (www.crigroup.com), a global supplier of investigative, forensic accounting, business due to diligence and employee background screening services for some of the world’s leading business organizations. Headquartered in London (with a significant presence throughout the region) and licensed by the Dubai International Financial Centre-DIFC, the Qatar Financial Center – QFC, and the Abu Dhabi Global Market-ADGM, CRI® Group safeguard businesses by establishing the legal compliance, financial viability, and integrity levels of outside partners, suppliers and customers seeking to affiliate with your business. CRI® Group maintains offices in UAE, Pakistan, Qatar, Singapore, Malaysia, Brazil, China, the USA, and the United Kingdom.

Contact CRI® Group to learn more about its 3PRM-Certified™ third-party risk management strategy program and discover an effective and proactive approach to mitigating the risks associated with corruption, bribery, financial crimes and other dangerous risks posed by third-party partnerships.

CONTACT INFORMATION

Zafar Anjum, MSc, MS, CFE, CII, MICA, Int. Dip. (Fin. Crime) | CRI® Group Chief Executive Officer

37th Floor, 1 Canada Square, Canary Wharf, London, E14 5AA United Kingdom

t: +44 207 8681415 | m: +44 7588 454959 | e: zanjum@crigroup.com

Filed under: Anti-Bribery Anti-Corruption Solution, Compliance Solution, ISO 37001, Resources by admin
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Newly published whitepapers examine corruption laws and fraud

Fraud and corruption are always evolving. Changes in methods, technology and other factors make it critically important those trying to prevent and detect it to evolve, as well. Part of that process is to analyse fraud, corruption, bribery, money laundering and other crimes through the lense of research and casework. When experts share their findings and their knowledge into the numerous laws and regulations that address fraud, everyone benefits – especially vulnerable businesses and other organisations. CRI Group has recently published three new whitepapers that provide insightful looks into issues at the forefront of fraud and corruption today. They range from deep dives into the U.S., U.K. and other anti-fraud and anti-corruption laws around the world, to close examinations of actual fraud cases that hold lessons for all of us. We invite you to download these whitepapers and increase your knowledge of fraud, corruption, proper compliance, risk assessments, due diligence and more.

 1. “The Catalysts for Economic Crime: An Investigative Study Into Causal Factors of the Perpetration of Transnational Financial Crimes”

This whitepaper provides an in-depth study of transnational financial crimes and the national laws and regulations that govern them. Laws in the U.S. and the U.K, in particular, are compared and examined in terms of effectiveness in preventing financial crimes.

The comparative study focuses on corporate fraud. “The Catalysts for Economic Crime” pursues the question as to how weaknesses in national laws can be considered “a core causal factor in the perpetration of transnational financial crimes.” Readers will learn about the need to strengthen such laws or risk continued and increased criminal activity.

Different types of financial crimes are examined, including money laundering, due to its prominence as a form of transnational financial crime. The research provides a detailed discussion of the inadequacies in current national laws, and proposes solutions through increased accountability, compliance-focused on self-governance and heightened monitoring for violations, among other important considerations. Download the whitepaper for free.

2. “Countering Bribery & Corruption in the Public & Private Sectors: Anti-Corruption Culture, Risk Assessment, Auditing & Compliance”

This publication provides an insightful look at the responsibility of corporations to monitor and mitigate risks. This whitepaper examines two high profile corruption cases, Airbus and Rolls-Royce, to provide a deeper understanding of how bribery and other financial crimes can take root at organisations without proper prevention procedures and inadequate controls.

The global nature of the enterprise that makes corruption even more prevalent in modern times also makes prevention more difficult. When it comes to putting procedures in place to prevent bribery and corruption, “the concept of ‘adequate procedures’ is “vulnerable to interpretation depending upon national or industrial jurisdiction … and many enforcement agencies and government authorities have failed to provide guidance regarding the definition of ‘adequate procedures’ as it shapes both Anti-Corruption guidelines and legal defence.

Case studies often provide an extremely effective way of demonstrating the effect of inadequate controls and procedures when it comes to corruption. In the cases of Airbus and Rolls-Royce, the financial crimes and their ramifications were significant. Airbus committed to financial penalties of $4 billion; a system of “intermediary leverage” involved hundreds of its agents in 16 countries “to encourage national and airline purchase of the company’s civilian aircraft and satellites.” In the case of Rolls-Royce, a four-year investigation uncovered corruption, false accounting and failure to prevent bribery, leading to fines in excess of ?497.2 million – which accounted for approximately 3.4% of Rolls-Royce’s revenues for 2016. Find out what can be learned from these cases and how proper controls could have prevented them. Download the whitepaper for free.

3. “Organised Catastrophe of Pakistan International Airlines: Major Critical Risk Elements – Mismanagement – Corruption”

This whitepaper provides another case study, this one a close examination of Pakistan International Airlines (PIA) which has been embroiled in a scandal. The cases of professional fraud involve fake degrees and fraudulent licenses, and there have been cases of air accidents with loss of lives. This white paper investigates how the PIA case is not a coincidence, but rather an “organised failure of institutional management, state, and internal controls.”

In fact, the PIA investigation comes at a time when fraud and corruption among state-owned enterprises in Pakistan and elsewhere is rising at an alarming rate. This has links to fraud in governmental institutions, and PIA is just a high-profile example of what can result when such corruption goes unchecked.

This whitepaper analyses two major risk elements at PIA, in terms of mismanagement, and corruption in the form of kickbacks. This research paper also proposes solutions for dealing with such systemic, organizational crimes, the foundation of which is to implement a business-based risk management framework. Download the whitepaper for free.

Let’s talk!

If you have any further questions or interest anti-corruption solutions, please contact us.

CRI Group has safeguarded businesses from any risks, providing investigations (i.e. insurance fraud), employee background screening, investigative due diligence, business intelligence,  third-party risk management, forensic accounting, compliance and other professional investigative research services. In 2016, CRI Group launched Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management Systems, ISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification. ABAC® operates through its global network of certified ethics and compliance professionals, qualified auditors and other certified professionals. Contact ABAC® for more on ISO Certification and training.

Filed under: Anti-Bribery Anti-Corruption Solution, Compliance Solution, Due Diligence, ISO 37001, Resources, Third-Party Risk Management by admin
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What are the guidelines and qualifications for ISO 37001:2016?

To many bribery cases are in the headlines, but all of these provide lessons for business leaders around the world. As reported in the Industry resource, Alere Inc., a global manufacturer of rapid point-of-care diagnostic tests, will pay more than $13 million to settle charges that it bribed foreign officials and committed accounting fraud to meet revenue targets. What are the guidelines and qualifications for ISO 37001:2016?

The U.S. Securities & Exchange Commission imposed the order, based on the fact that “Alere subsidiaries in India and Colombia ‘obtained or retained business’ by using distributors or consultants to make improper payments to officials of government agencies or entities under government control,” Industry resource reported.

The article states:

“In Colombia, improper payments of about $275,000 helped Alere win business from a government-linked customer. In India, the Alere unit through a distributor paid local governmental officials a four percent commission to increase orders for medical testing kits from 200,000 to 1 million units.”

The company allegedly netted millions for its efforts. It’s against this backdrop that it becomes clear that training and certification to prevent bribery and corruption is crucial for organisations today. For anyone doing business across international borders, it is critically important to be in full compliance and proactive in prevention and detection. But what are some of the requirements and guidelines for pursuing ISO 37001:2016 certification? Here, we address the most pertinent questions:

What are the training and certification guidelines set up by ICA?

ICA provides knowledge about anti-corruption as whole and bribery as a subset. It defines how bribery/corruption takes place and affect an organisation.

Which regulations does the ISO training specifically address?

ISO 37001:2016 training addresses the Foreign Corrupt Practices Act (FCPA) UK Bribery Act, among others.

How long is the certification valid?

How often you should update if needed? The certificate is valid for three years. It should be updated, however, if there is a change in the standard that would require additional training.

Why is it necessary to be certified by an accredited body like CRI Group’s ABAC Center of Excellence?

Certification through a qualified and endorsed firm of experts like CRI Group adds a distinct level of credibility to the organisation’s management systems, and ensures that the organisation is implementing a viable anti-bribery management program utilising widely accepted controls and systems.

It also provides assurance to management, investors, business associates, personnel and other stakeholders that the organisation is actively pursuing internationally recognised and accepted processes to prevent bribery and corruption. Most importantly, training and certification through a third-party like CRI Group protects your organisation, its assets, shareholders and directors from the effects of bribery. And, if needed, it provides acceptable evidence to prosecutors or courts that the organisation has taken reasonable steps to prevent bribery and corruption.

Who is CRI Group?

Based in London, CRI Group works with companies across the Americas, Europe, Africa, Middle East and Asia-Pacific as a one-stop international Risk Management, Employee Background Screening, Business Intelligence, Due Diligence, Compliance Solutions and other professional Investigative Research solutions provider. We have the largest proprietary network of background-screening analysts and investigators across the Middle East and Asia. Our global presence ensures that no matter how international your operations are we have the network needed to provide you with all you need, wherever you happen to be. CRI Group also holds BS 102000:2013 and BS 7858:2012 Certifications, is an HRO certified provider and partner with Oracle.

In 2016, CRI Group launched Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management Systems, ISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification. ABAC® operates through its global network of certified ethics and compliance professionals, qualified auditors and other certified professionals. As a result, CRI Group’s global team of certified fraud examiners work as a discreet white-labelled supplier to some of the world’s largest organisations. Contact ABAC® for more on ISO Certification and training.

Filed under: Anti-Bribery Anti-Corruption Solution, Resources by admin
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ISO 37001: Applying Anti-Bribery Framework to Third Parties

In 2016, responding to the need for a global standard to help organisations prevent and detect bribery and corruption, the International Organization for Standardization (ISO) introduced ISO 37001: Anti-Bribery Management Systems. This certification provides the anti-bribery framework for organisations of any size or industry to implement practical solutions against bribery. Perhaps overlooked, however, is the fact that ISO 37001’s framework isn’t designed only for an organisation’s own internal systems. It can also be applied to existing or potential third-party partners. This adds a crucial layer of third-party due diligence and risk management in today’s world of international business.

The ISO 37001 Framework

Corporations, agencies, and even small companies don’t exist in a bubble. The reality of international trade and the interconnectedness of business make the potential for bribery and corruption a serious and continuous concern. While there are laws that govern business conduct along these lines, such as the Foreign Corrupt Practices Act (FCPA) and the UK Bribery Act 2010, prior to 2016 organisations lacked a unified standard to help them implement proper controls for prevention and detection. This was a critical vulnerability, considering new laws in various jurisdictions were prescribing heavier penalties, and governments were, by and large, pursuing more enforcement actions.

Recognising this need, ISO unveiled 37001 with a twofold approach: Provide a practical, measurable system that organisations can implement to prevent and protect fraud; while keeping the system flexible and adaptable to fit any industry or jurisdiction. ISO was uniquely positioned to develop such anti-bribery framework with its reputation, having been in the standards business since 1947; and its global reach, which includes 164 member countries. Click here to read the full article.

Don’t let corruption thrive. Take a proactive stance with the highest level of compliance as a part of your essential business strategy. Contact us today to learn more about our full range of services to help your organisation stay protected. Get a FREE QUOTE

About CRI Group!

Based in London, CRI Group works with companies across the Americas, Europe, Africa, Middle East and Asia-Pacific as a one-stop international Risk Management, Employee Background Screening, Business Intelligence, Due Diligence, Compliance Solutions and other professional Investigative Research solutions provider. We have the largest proprietary network of background-screening analysts and investigators across the Middle East and Asia. Our global presence ensures that no matter how international your operations are we have the network needed to provide you with all you need, wherever you happen to be. CRI Group also holds BS 102000:2013 and BS 7858:2012 Certifications, is an HRO certified provider and partner with Oracle.

In 2016, CRI Group launched Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management Systems, ISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification. ABAC® operates through its global network of certified ethics and compliance professionals, qualified auditors and other certified professionals. As a result, CRI Group’s global team of certified fraud examiners work as a discreet white-labelled supplier to some of the world’s largest organisations. Contact ABAC® for more on ISO Certification and training.[/accordion_son][/accordion_father][/vc_column][/vc_row]

Filed under: Anti-Bribery Anti-Corruption Solution, ISO 37001, Resources, Third-Party Risk Management by admin
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Can ISO 37001:2016 prevent bribery?

Since its launch in 2016, ISO 37001 Anti-Bribery Management Systems standard has had its supporters and critics. Some regulatory bodies and compliance communities initially expressed concern regarding the lack of a body of evidence supporting the effectiveness of ISO 37001:2016 from certain standpoints. Critics asserted that the new standard failed to address broad compliance concerns, and questioned whether ISO 37001:2016 certification alone can prevent prosecution. These observations should certainly be weighed and considered, as any new compliance standard must be properly evaluated on its merits. In the case of ISO 37001, however, the critics have made some misjudgments in regards to the key factors they feel are in question with the standard. Can ISO 37001:2016 prevent bribery?

One of the most important things to remember is that a standard like 37001 and all of its measures require a commitment and implementation by the organisation adopting them. ISO 37001 is a standard, administered by a certified body but ultimately implemented by employees of the organisation itself. The purpose of ISO 37001 standard is to provide a framework against which an organisation’s anti-bribery management can be assessed and certified, rather than a foolproof blueprint to prevent bribery.

The story behind ISO 37001:2016

First, some background: The International Organization for Standardization, or ISO, is the international standard-setting body composed of representatives from various national standards organisations. Founded on 23 Feb. 1947, ISO promotes worldwide proprietary, industrial, and commercial standards. Responding to an international need, ISO issued the 37001:2016 Anti-Bribery Management System standard to help businesses, nonprofits and governmental agencies reduce their risk of bribery and corruption by establishing, implementing, maintaining and improving an anti-bribery management system.

The ISO 37001 standard requirement, which references to ISO 19600 – Compliance Management System, specifies mandatory requirements for organisations when establishing/updating their anti-bribery management programs in a manner that is proportionate to the potential bribery risk. The reference to these requirements is referred to as “appropriate” and “reasonable”, hence directing organisations to undertake a subjective, diligent and rigorous review of current compliance framework, which will make ISO 37001 effective for them. According to Deloitte & Touche LLP, “[in ISO 37001:2016] it’s the substance, not the form, of a compliance program that determines its effectiveness”.

Anti-corruption versus broad compliance issues

Some of the concerns regarding the effectiveness of ISO 37001 are focused on whether it addresses broad compliance issues, like inequality, harassment, various types of fraud (outside of bribery and corruption), or similar offences. Seeing that it generally does not, as its focus is on anti-bribery and anti-corruption compliance, some take the view that ISO 37001 has adopted a simplistic approach. The scope of ISO 37001 addresses “establishing, implementing, maintaining, reviewing, and improving an anti-bribery management system,” whether as a stand-alone initiative or part of a broader anti-corruption. Therefore, implementing ISO 37001 standard requirements should be viewed as a way of enhancing, rather than replacing, an organisation’s existing anti-corruption compliance programs.

ISO 37001 is effective step-by-step guidance for those organisations which lack an anti-corruption framework and enables them to implement a compliance program without investing significant time in identifying the regulatory and non-regulatory requirements. In fact, ISO 37001 has incorporated Federal Sentencing Guidelines, U.S. Department of Justice (DOJ) and Securities and Exchange Commission (SEC) Resource Guide to the U.S. Foreign Corrupt Practices Act, the U.K. Ministry of Justice Bribery Act 2010 Guidance, and OECD’s Good Practice Guidance on Internal Controls, Ethics and Compliance. Former U.S. Deputy Attorney General Rod Rosenstein highlighted three hallmarks of a policy-effective compliance program, which are concurrent with ISO 37001 requirements and include: fostering a culture of compliance; dedicating sufficient resources to compliance activities; and ensuring that experienced compliance personnel has appropriate access to the board.

Prosecution of offences

Lastly, there is a widely held belief that obtaining ISO 37001 certification is an effective tool to avoid prosecution for bribery. These misconceptions have not been viewed favourably insofar as to Ms. Hui Chen, U.S. DOJ’s former compliance counsel, stating “Dan Kahn, the Chief of the FCPA Unit in the Fraud Section of DOJ’s Criminal Division, has been very consistent: prosecutors will not outsource their responsibilities”. Rightly so. ISO 37001 certification does not act as insurance to corporate liability for bribery, neither does it refute the need to perform due diligence, and it should be considered and implemented as per company’s risk profile. In practicality, implementing ISO 37001 can demonstrate to enforcement agencies and regulators that the organisation has taken reasonable steps to establish a compliance program to mitigate bribery risks, however, ISO 37001 certification will mitigate the consequences, if not a shield, an organisation from investigation or prosecution.

ISO 37001:2016 embraced by organisations and governments

It is important to note that organisations and governments alike are embracing ISO 37001 as the standard for prevention and detection. One example of this is in Malaysia, where the ISO 37001 standard was adopted across the government under Prime Minister Tun Dr Mahathir Mohamad. The new system has been received positively in both the public and private sectors, and Malaysia’s former anti-graft chief said “the people’s perception on the government’s seriousness to fight corruption had increased to 70.8 per cent last year from 59.8 per cent in 2016. He said that Malaysia has also shown improvement in its performance indicators in several important international studies and indexes” (New Straits Times, 2019). True to form, various heads of government in the country are following the directive. Defence Minister Mohamed Sabu recently “cautioned his officers to adhere to the Anti-Bribery Management System, which had attained the International Standards Organisation’s ISO 37001: 2016 certification” (New Straits Times, 2019).

Malaysia is not alone. In Peru, Singapore, and China (Shenzhen Institute of Standards and Technology [SIST]), the national standard bodies have adopted and localised the ISO 37001 standard. In Italy, the ISO 37001 accreditation scheme has been developed by Accredia; whereas in the UK, United Kingdom Accreditation Service (UKAS) has undertaken an ISO 37001 pilot program to develop an accreditation scheme. In the United Arab Emirates, Emirates International Accreditation Centre (EIAC) is undertaking the ISO 37001 accreditation scheme development with CRI® Group’s ABAC® Center of Excellence. ABAC® is an initiative launched by CRI® Group and offers ISO 37001 certification services. Hence, amid these positive developments, the outlook for ISO 37001 looks promising. ISO 37001 is not a “silver bullet” to foolproof an organisation from bribery or corruption, or avoid prosecution should those offences occur. It was never designed to be. Instead, it is a framework to implement the necessary controls and systems at the organisation level – across all levels – so as to be better equipped to prevent bribery and corruption moving forward.

CRI® Group has experts who have conducted fraud investigations all around the world, for organisations of all sizes and industries. Our investigators work on-site at your company bringing a boots-on-the-ground approach to uncovering all the facts of the case. When you’ve uncovered fraud, that’s the time to let the experts take over. You owe it to yourself and the future of your business to make sure every investigation is done professionally and effectively. Contact CRI® Group to learn more about our fraud investigations today. Get a FREE QUOTE

About us…

Based in London, CRI® Group works with companies across the Americas, Europe, Africa, Middle East and Asia-Pacific as a one-stop international Risk Management, Employee Background Screening, Business Intelligence, Due Diligence, Compliance Solutions and other professional Investigative Research solutions provider. We have the largest proprietary network of background screening analysts and investigators across the Middle East and Asia. Our global presence ensures that no matter how international your operations are, we have the network needed to provide you with all you need, wherever you happen to be. CRI® Group also holds BS102000:2013 and BS7858:2019 Certifications is an HRO certified provider and partner with Oracle.

In 2016, CRI® Group launched the Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management Systems, ISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification. ABAC® operates through its global network of certified ethics and compliance professionals, qualified auditors and other certified professionals. As a result, CRI® Group’s global team of certified fraud examiners work as a discreet white-labelled supplier to some of the world’s largest organisations. Contact ABAC® for more on ISO Certification and training.

MEET THE CEO

Zafar I. Anjum is Group Chief Executive Officer of CRI® Group (www.crigroup.com), a global supplier of investigative, forensic accounting, business due to diligence and employee background screening services for some of the world’s leading business organisations. Headquartered in London (with a significant presence throughout the region) and licensed by the Dubai International Financial Centre-DIFC, the Qatar Financial Center – QFC, and the Abu Dhabi Global Market-ADGM, CRI® Group safeguard businesses by establishing the legal compliance, financial viability, and integrity levels of outside partners, suppliers and customers seeking to affiliate with your business. CRI® Group maintains offices in UAE, Pakistan, Qatar, Singapore, Malaysia, Brazil, China, the USA, and the United Kingdom.

Contact CRI® Group to learn more about its 3PRM-Certified™ third-party risk management strategy program and discover an effective and proactive approach to mitigating the risks associated with corruption, bribery, financial crimes and other dangerous risks posed by third-party partnerships.

CONTACT INFORMATION

Zafar Anjum, MSc, MS, CFE, CII, MICA, Int. Dip. (Fin. Crime) | CRI® Group Chief Executive Officer

37th Floor, 1 Canada Square, Canary Wharf, London, E14 5AA United Kingdom

t: +44 207 8681415 | m: +44 7588 454959 | e: zanjum@crigroup.com

Filed under: Anti-Bribery Anti-Corruption Solution, Compliance Solution, Due Diligence, ISO 37001, Resources by admin
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Brexit poses bribery challenges but ISO 37001 provides solutions

While the United Kingdom has positioned itself as a leader in the fight against fraud and corruption, the shifting economic conditions surrounding Brexit have raised uncertainty and vulnerability. As some organisations are forced to forge new trade deals outside of already established European Union (EU) relationships, some experts warn that there will be more exposure to corrupt markets. This new wrinkle comes nine years after passage of the Bribery Act 2010, which marked a major salvo in the war against bribery and corruption. The Bribery Act enhanced existing British law against corruption and placed a new level of responsibility squarely at the feet of organisations. It requires organisations to demonstrate anti-bribery procedures and controls, while also providing strict penalties for breaches of anti-bribery laws. The takeaway for UK companies is that they need to take action now. With Brexit posing challenges through new, untested trade deals in various markets, organisations need ISO 37001 – Anti-Bribery Management Systems standard as a comprehensive approach to mitigating risk. ISO 37001 include adopting an anti-bribery policy, including anti-bribery compliance, training, risk assessments and due diligence on projects and business associates. It also calls for implementing financial and commercial controls, and instituting reporting and investigation procedures.

The Persistence of Bribery and Corruption

Worldwide, bribery and corruption are still massive problems. Global anti-fraud watchdog Transparency International states that “only 11 major exporting countries – accounting for about a third of world exports – have active or moderate law enforcement against companies bribing abroad in order to gain mining rights, contracts for major construction projects, purchases of planes and other deals”. Great Britain is certainly one of those countries actively enforcing against bribery, and the UK Bribery Act placed it within the leading edge of the fight against bribery and corruption. Even still, Great Britain fell three places in Transparency International’s 2018 Corruption Perceptions Index (released in 2019). The country slipped from 8^th place to 11^th. The drop is seen by some as an embarrassment for a government that takes a hard line against corruption, and faces new challenges posed by a post-Brexit future.

Rolls-Royce Agrees to Massive Fines

Recent high-profile bribery and corruption scandals demonstrate how pervasive the problem is. Among them, a scandal involving British engineering giant Rolls-Royce led to the corporation agreeing to pay £671m to settle corruption cases with UK and U.S. authorities (£497m plus costs earmarked for the UK Serious Fraud Office, which conducted its biggest ever investigation into the firm). The SFO found conspiracy to corrupt or failure to prevent bribery by Rolls-Royce in China, India, Russia, Thailand, Malaysia, and other markets. The firm apologised “unreservedly” for the cases spanning nearly 25 years.

The wrongdoing involved Rolls-Royce’s “intermediaries”, which are local companies that handle sales, distribution and maintenance in countries where the British firm does not have enough people on the ground. Thirty-eight employees have faced disciplinary proceedings. Eleven left the firm during the disciplinary process. Six were dismissed. Rolls-Royce has also reviewed 250 intermediary relationships across the company – 88 have now been suspended.

Recently, the Serious Fraud Office says it ended its investigation but only after Rolls-Royce entered the deferred prosecution agreement and accepted responsibility “for corrupt conduct spanning three decades, seven jurisdictions and three businesses, for which it paid a fine of £497.25m”, according to SFO director Lisa Osofsky.

Cadbury Limited Pays for FCPA Violations

In another recent case, British confectionary company Cadbury Limited and its owner, Mondel?z International, Inc., agreed to pay $13 million to settle charges of violating the internal controls and books-and-records provisions of the FCPA. According to the order from the U.S. Securities and Exchange Commission (SEC), the FCPA violations arose from payments their subsidiary in India made to a consultant to obtain government licenses and approvals for a chocolate factory in Baddi, India.

An SEC investigation found that in February 2010, Mondel?z, formerly known as Kraft Foods, Inc., acquired Cadbury and its subsidiaries, including Cadbury India Limited, which manufactures and sells chocolate products in India. Cadbury India retained and made payments to an agent to interact with Indian government officials to obtain licenses and approvals for a chocolate factory in Baddi, India. Cadbury India failed to conduct appropriate due diligence on, and monitor the activities of, the agent.

From February 2010 to July 2010, the agent submitted five invoices to Cadbury India for, among other things, preparing license applications. Cadbury India employees at Baddi, not the agent, prepared these license applications. Cadbury India paid the agent a total of $90,666 (after withholding tax) upon receipt of the invoices. After receiving each payment, the agent withdrew from its bank account most of the funds in cash. During this time period, Cadbury India obtained some of the licenses and approvals. Without admitting or denying the findings, Cadbury and Mondel?z agreed to a cease-and-desist order and payment of a $13 million civil penalty.

The Bribery Act 2010 and UK Anti-Corruption Strategy 2017-2022

Passage of the Bribery Act 2010 in the UK marked a major milestone in the effort to prevent, detect, and prosecute bribery and corruption. Building off of existing British law and other international legislation like the U.S. Foreign Corrupt Practices Act (FCPA), the Bribery Act 2010 created a new offence which can be committed by commercial organisations that fail to prevent persons associated with them from bribing another person on their behalf. In turn, an organisation that can demonstrate having adequate procedures in place to prevent persons associated with it from committing bribery have a defence to the section 7 offence. In 2018, eight years after passage of the UK Bribery Act, the total number of SFO investigations was “believed to be in region of 70-75,” with “dozens” of bribery and corruption cases in the investigative pipeline.

In 2017, the HM Government (formerly Her Majesty’s Government) released its first UK Anti-Corruption Strategy 2017-2022 to provide a framework to guide government policy and action against corruption. The strategy aims to reduce threats to national security, protect the economy and foster business opportunities (especially for British businesses) and build public trust and confidence. It also sets out six clear priorities for the British Parliament: (1) reduce the insider threat in high-risk domestic sectors such as borders and ports; (2) strengthen the integrity of the UK as an international financial centre; (3) promote integrity across the public and private sectors; (4) reduce corruption in public procurement and grants; (5) improve the business environment globally; (6) work with other countries to combat corruption. The strategy’s emphasis on transparency, risk mitigation and compliance should serve as a strong indication that organisations are expected to be held to a higher standard if they are based or do business in the UK.

This is why it is of such critical importance that organisations doing business from the UK, or through/across its borders, have credentialed and tested processes like the ISO 37001 Anti-Bribery Management System Standard in place. Switzerland-based International Organization for Standardization issued the 37001 Anti-Bribery Management System Standard in 2016 to help organisations worldwide increase and measure their efforts against bribery and corruption. The standard will be discussed in depth later in this article.

Brexit and the Potential for Increased Bribery

With the UK leaving the European Union, the debate and protests have mostly been political in nature. A major concern, however, that is only recently being discussed is the potential business impact regarding bribery and corruption. In particular, the UK’s National Crime Agency (NCA) has warned that the UK’s exit from the EU will impact the prevalence of bribery and corruption over the next five years, as UK companies potentially come into greater contact with corrupt markets. In addition, there is a report so secret that it has not been made public, according to an article in the Independent that quotes NCA Director-general Lynne Owens as saying that “We produce an ‘official sensitive’ and ‘top secret’ report that would go into the detail of where and what we are concerned about”. For watchdogs on bribery and corruption, such a statement is ominous, at best.

It’s worth noting that some Brexiters see the departure from the EU as an opportunity to cut red tape, which could further the regulation problem. Brexit could prompt the UK to strike trade deals with countries that have a heightened corruption risk. To embrace a reduction of “red tape” in favour of lax controls, however, would be a monumental mistake – with the Bribery Act 2010 still in full force, along with SEC enforcement of FCPA provisions. In fact, having anti-bribery standard implemented will now be more important than ever, as the SFO and other enforcement bodies will likely be scrutinising new trade deals more than ever in a new post-Brexit landscape.

ISO 37001 Anti-Bribery Management Standard

It is in this environment that ISO 37001 ABMS becomes a critical centrepiece for any organisation’s ABMS systems. Accredited providers of ISO 37001 such as ABAC (Anti-Bribery and Anti-Corruption) Center of Excellence, a global network of certified ethics and compliance professionals, qualified auditors, financial and corporate investigators, certified fraud examiners, forensic analysts and accountants, can be used as a tool for organisations to prevent bribery and corruption. ABAC Certification is an accredited provider of ISO 37001 ABMS Certification and Training for organisations of all types and industries.

The ISO 37001 standard specifies requirements and provides guidance for establishing, implementing, maintaining, reviewing and improving an anti-bribery management system. The system can be stand-alone or can be integrated into an overall management system. ISO 37001 addresses the following in relation to the organisation’s activities:

• Bribery in the public, private and not-for-profit sectors
• Bribery by the organisation
• Bribery by the organisation’s personnel acting on the organisation’s behalf or for its benefit
• Bribery by the organisation’s business associates acting on the organisation’s behalf or for its benefit
• Bribery of the organisation
• Bribery of the organisation’s personnel in relation to the organisation’s activities
• Bribery of the organisation’s business associates in relation to the organisation’s activities
• Direct and indirect bribery (e.g. a bribe offered or accepted through or by a third party)

When administered by an accredited provider of ISO ABMS certification and training, the protocol can:

• Help an organisation create new and better business partnerships with entities that recognise ISO 37001 certified status, including supply chain manufacturing, joint ventures, pending acquisitions and co-marketing alliances
• Potentially reduce corporate insurance premiums
• Provide customers, stakeholders, employees and partners with confidence in the entity’s business operations and ethics
• Provide a competitive edge over non-certified organisations the organisation’s industry or niche
• Provide acceptable evidence to prosecutors or courts that the organisation has taken reasonable steps to prevent bribery and corruption

The ISO 37001 process helps companies and government organisations reduce the risk of bribery by establishing, implementing, maintaining and enhancing internal anti-bribery and anti-corruption systems. ISO ABMS certification is a mitigating piece of evidence to regulators or even prosecutors and the courts that the entity has taken meaningful steps in its efforts to prevent bribery and corruption.

Conclusion

With the UK moving from the EU to a post-Brexit world, the time is now for organisations to protect their investments, their reputations and their business. The Bribery Act 2010 puts an emphasis on proactive prevention and compliance. The SFO and other enforcement bodies will almost certainly respond to guidance that warns of a post-Brexit potential for increased bribery and corruption. The result will be increased scrutiny and a likely no-tolerance approach for breaches. As such, UK corporations and their overseas partners should stand ready to demonstrate their implementation of internal processes, policies and controls to prevent and detect bribery and corruption and remain in compliance.

The ISO 37001 ABMS standard is established, tried and tested program that addresses those issues head-on through a comprehensive program of training and certification. The training process is tailored to the organisation, while still following the developed curriculum and documented best practices. Certification requires demonstrating that processes have been implemented effectively, with follow-up evaluations. The shift to a post-Brexit economy is the perfect opportunity to implement ISO 37001 standards – no reputable board of directors or governors should question the timing and importance of taking this step. It’s a matter of safeguarding the organisation, its reputation, and its future.

Let’s Talk!

If you have any further questions or interest in implementing compliance solutions, please contact us.

CRI Group has safeguarded businesses from any risks, providing investigations (i.e. insurance fraud), employee background screening, investigative due diligence, business intelligence,  third-party risk management, forensic accounting, compliance and other professional investigative research services. In 2016, CRI Group launched Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management Systems, ISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification. ABAC® operates through its global network of certified ethics and compliance professionals, qualified auditors and other certified professionals. Contact ABAC® for more on ISO Certification and training.[/vc_column_text][accordion_father caption_url=””][accordion_son title=”Meet our CEO” clr=”#ffffff” bgclr=”#1e73be”]ABOUT THE AUTHOR

Zafar I. Anjum is Group Chief Executive Officer of CRI Group, a global supplier of investigative, forensic accounting, business due diligence and employee background screening services for some of the world’s leading business organizations. Headquartered in London (with a significant presence throughout the region) and licensed by the Dubai International Financial Centre-DIFC, the Qatar Financial Center-QFC, and the Abu Dhabi Global Market-ADGM, CRI Group safeguards businesses by establishing the legal compliance, financial viability, and integrity levels of outside partners, suppliers and customers seeking to affiliate with your business. CRI Group maintains offices in UAE, Pakistan, Qatar, Singapore, Malaysia, Brazil, China, USA, and the United Kingdom.[/accordion_son][accordion_son title=”Sources & Credits” clr=”#ffffff” bgclr=”#1e73be”]

1. “Exporting Corruption”, Transparency International, 2018, < https://www.transparency.org/news/feature/exporting-corruption-2018> (accessed 18 Aug. 2019)
2. “Corruption Perceptions Index 2018”, Transparency International, 2019, < https://www.transparency.org/cpi2018> (accessed 18 Aug. 2019)

3. Caroline Binham, “UK drops out of top 10 in global anti-corruption rankings”, Financial Times, 28 Jan. 2019, < https://www.ft.com/content/8d1a2474-224e-11e9-b329-c7e6ceb5ffdf> (accessed 17 Aug. 2019)

4. Holly Watt, David Pegg, Rob Evans, “Rolls-Royce apologises in court after settling bribery case”, The Guardian, 17 Jan. 2017 < https://www.theguardian.com/business/2017/jan/17/rolls-royce-apologises-bribery-671m-uk-us-brazil > (accessed 18 Aug. 2019)

5. “Rolls-Royce apologises after £671m bribery settlement”, BBC News, 18 Jan. 2017, < https://www.bbc.co.uk/news/business-38644114 > (accessed 30 Aug. 2019)

6. “SFO drops investigations into Rolls-Royce and GSK”, BBC News, 22 Feb. 2019, < https://www.bbc.com/news/business-47330580 > (accessed 18 Aug. 2019)

7. Richard L. Cassin, “2017 FCPA Enforcement Index”, The FCPA Blog, 2 Jan. 2018, < https://www.fcpablog.com/blog/2018/1/2/2017-fcpa-enforcement-index.html > (accessed 19 Aug. 2019)

8. “ADMINISTRATIVE PROCEEDING File No. 3-17759”, SEC.GOV, < https://www.sec.gov/litigation/admin/2017/34-79753-s.pdf > (accessed 19 Aug. 2019)

9. “Bribery Act 2010 guidance”, GOV.UK, 11 Feb. 2012, < https://www.gov.uk/government/publications/bribery-act-2010-guidance > (accessed 18 Aug. 2019)

10. Lizzie Dearden, “Brexit could push UK companies into ‘greater contact with corrupt markets’ if EU trade deals lost”, The Independent, 14 May 2019, < https://www.independent.co.uk/news/uk/politics/brexit-uk-business-corrupt-markets-trade-deal-a8914016.html > (accessed 18 Aug. 2019)

11. Caroline Binham, “UK drops out of top 10 in global anti-corruption rankings”, Financial Times, 28 Jan. 2019, < https://www.ft.com/content/8d1a2474-224e-11e9-b329-c7e6ceb5ffdf> (accessed 17 Aug. 2019)

12. “ISO 37001:2016 ANTI-BRIBERY MANAGEMENT SYSTEMS — REQUIREMENTS WITH GUIDANCE FOR USE”, www.ISO.org, < https://www.iso.org/standard/65034.html > (accessed 5 Aug. 2019)

[/accordion_son][accordion_son title=”Sources & Credits” clr=”#ffffff” bgclr=”#1e73be”]

1. “Exporting Corruption”, Transparency International, 2018, < https://www.transparency.org/news/feature/exporting-corruption-2018> (accessed 18 Aug. 2019)
2. “Corruption Perceptions Index 2018”, Transparency International, 2019, < https://www.transparency.org/cpi2018> (accessed 18 Aug. 2019)

3. Caroline Binham, “UK drops out of top 10 in global anti-corruption rankings”, Financial Times, 28 Jan. 2019, < https://www.ft.com/content/8d1a2474-224e-11e9-b329-c7e6ceb5ffdf> (accessed 17 Aug. 2019)

4. Holly Watt, David Pegg, Rob Evans, “Rolls-Royce apologises in court after settling bribery case”, The Guardian, 17 Jan. 2017 < https://www.theguardian.com/business/2017/jan/17/rolls-royce-apologises-bribery-671m-uk-us-brazil > (accessed 18 Aug. 2019)

5. “Rolls-Royce apologises after £671m bribery settlement”, BBC News, 18 Jan. 2017, < https://www.bbc.co.uk/news/business-38644114 > (accessed 30 Aug. 2019)

6. “SFO drops investigations into Rolls-Royce and GSK”, BBC News, 22 Feb. 2019, < https://www.bbc.com/news/business-47330580 > (accessed 18 Aug. 2019)

7. Richard L. Cassin, “2017 FCPA Enforcement Index”, The FCPA Blog, 2 Jan. 2018, < https://www.fcpablog.com/blog/2018/1/2/2017-fcpa-enforcement-index.html > (accessed 19 Aug. 2019)

8. “ADMINISTRATIVE PROCEEDING File No. 3-17759”, SEC.GOV, < https://www.sec.gov/litigation/admin/2017/34-79753-s.pdf > (accessed 19 Aug. 2019)

9. “Bribery Act 2010 guidance”, GOV.UK, 11 Feb. 2012, < https://www.gov.uk/government/publications/bribery-act-2010-guidance > (accessed 18 Aug. 2019)

10. Lizzie Dearden, “Brexit could push UK companies into ‘greater contact with corrupt markets’ if EU trade deals lost”, The Independent, 14 May 2019, < https://www.independent.co.uk/news/uk/politics/brexit-uk-business-corrupt-markets-trade-deal-a8914016.html > (accessed 18 Aug. 2019)

11. Caroline Binham, “UK drops out of top 10 in global anti-corruption rankings”, Financial Times, 28 Jan. 2019, < https://www.ft.com/content/8d1a2474-224e-11e9-b329-c7e6ceb5ffdf> (accessed 17 Aug. 2019)

12. “ISO 37001:2016 ANTI-BRIBERY MANAGEMENT SYSTEMS — REQUIREMENTS WITH GUIDANCE FOR USE”, www.ISO.org, < https://www.iso.org/standard/65034.html > (accessed 5 Aug. 2019)

[/accordion_son][/accordion_father][/vc_column][/vc_row]

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Anti-Bribery Compliance Programs in EMEA Countries

Preventing bribery and corruption is a global effort that crosses international borders…

Preventing bribery and corruption is a global effort that crosses international borders. In just the past few years, many governments have enacted more laws and regulations to reflect that reality. European, Middle Eastern and African (EMEA) countries are no exception – in many ways, they are at the forefront of this new anti-bribery and anti-corruption landscape and compliance program development. This critical shift from bygone years of sweeping unethical business behaviour under the rug to creating strict enforcement measures is well overdue. The sometimes overlapping nature of these laws and varying rules based upon their jurisdictions can pose challenges to compliance officers, however. Not to mention that the “letter of the law” sometimes lends to different interpretations depending on the local politics of the day.

When organisations do uncover wrongdoing, their leadership must be careful to understand that the wrong approach to investigation might get them into trouble: employee privacy protections are higher in some European nations, for example, potentially affecting a company’s ability to monitor employee behaviour and investigate wrongdoing.

The article will discuss some of the new laws and regulations that have been enacted (or are still emerging) in various EMEA countries, and provide a perspective on managing compliance standards across varying jurisdictions. The new wave of anti-bribery and anti-corruption controls is a good thing for the economy and for protecting investments worldwide. Business leaders must just be sure not to get caught by the tide.

Europe: Leading the Charge

In most European countries today, it can be very costly to be caught breaking bribery laws. Most laws call for stiff fines. The UK largely ushered in this landscape with the introduction of the UK Bribery Act 2010. Under this groundbreaking law, individuals or businesses may face up to 10 years in prison or unlimited fines. “The UK Bribery Act imposes more severe penalties and is broader in scope than the FCPA, covering bribes to private parties as well to foreign officials. The UK Bribery Act also prohibits being bribed, not just giving bribes. Because of the close ties between the United States and the United Kingdom, US businesses should pay special attention to all forms of potential bribery abroad, regardless of jurisdictional technicalities.” (Everfi, 2020).

Click here to read the full article.

Other Anti-Bribery and Compliance resources from our independent certification body ABAC®:

• Prove that your business is ethical. Complete our FREE Highest Ethical Business Assessment (HEBA) and evaluate your current Corporate Compliance Program. Find out if your organization’s compliance program is in the line with worldwide Compliance, Business Ethics, Anti-Bribery and Anti-Corruption Frameworks.
• Bribery and corruption plague Middle East, how can ISO 37001 help? Read more here or download the free e-book now to know more about ABAC solutions in the Middle East.
• Are you ready for ISO 37001? Download our free e-book: The latest global anti-bribery standards redefine a framework for corporate compliance, and find out more!

Let’s Talk!

If you have any further questions or interest in implementing compliance solutions, please contact us.

Don’t leave hiring to chance. Take a proactive stance with the highest level of background screening as a part of your essential corporate strategy. Contact us today to learn more about our full range of services to help your organization stay protected.

Get a FREE QUOTE

About us…

Based in London, CRI® Group works with companies across the Americas, Europe, Africa, Middle East and Asia-Pacific as a one-stop international Risk Management, Employee Background Screening, Business Intelligence, Due Diligence, Compliance Solutions and other professional Investigative Research solutions provider. We have the largest proprietary network of background screening analysts and investigators across the Middle East and Asia. Our global presence ensures that no matter how international your operations are, we have the network needed to provide you with all you need, wherever you happen to be. CRI® Group also holds BS102000:2013 and BS7858:2019 Certifications is an HRO certified provider and partner with Oracle.

In 2016, CRI® Group launched the Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management Systems, ISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification. ABAC® operates through its global network of certified ethics and compliance professionals, qualified auditors and other certified professionals. As a result, CRI® Group’s global team of certified fraud examiners work as a discreet white-labelled supplier to some of the world’s largest organizations. Contact ABAC® for more on ISO Certification and training.

MEET THE CEO

Zafar I. Anjum is Group Chief Executive Officer of CRI® Group (www.crigroup.com), a global supplier of investigative, forensic accounting, business due to diligence and employee background screening services for some of the world’s leading business organizations. Headquartered in London (with a significant presence throughout the region) and licensed by the Dubai International Financial Centre-DIFC, the Qatar Financial Center – QFC, and the Abu Dhabi Global Market-ADGM, CRI® Group safeguard businesses by establishing the legal compliance, financial viability, and integrity levels of outside partners, suppliers and customers seeking to affiliate with your business. CRI® Group maintains offices in UAE, Pakistan, Qatar, Singapore, Malaysia, Brazil, China, the USA, and the United Kingdom.

Contact CRI® Group to learn more about its 3PRM-Certified™ third-party risk management strategy program and discover an effective and proactive approach to mitigating the risks associated with corruption, bribery, financial crimes and other dangerous risks posed by third-party partnerships.

CONTACT INFORMATION

Zafar Anjum, MSc, MS, CFE, CII, MICA, Int. Dip. (Fin. Crime) | CRI® Group Chief Executive Officer

37th Floor, 1 Canada Square, Canary Wharf, London, E14 5AA United Kingdom

t: +44 207 8681415 | m: +44 7588 454959 | e: zanjum@crigroup.com

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ISO 37001 Can Help US Organizations Prevent Corruption

First-world countries are not immune to the global problem of corruption. The United States – considered by many as one of the leaders in anti-corruption laws and enforcement – has faced a rash of major corruption scandals over the past 20 years and beyond. In the early 2000s, accounting scandals like Enron and WorldCom rocked the business world and caused major economic losses among investors and other stakeholders. More recently, investigations into alleged violations of the Foreign Corrupt Practices Act (FCPA) often begin with illicit actions taken broad but are traced back to U.S.-based companies right here at home. Iconic companies like Walmart and Microsoft are among the U.S. organizations that have been involved in large settlements with the U.S. Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) over bribery and corruption charges. These fines, coupled with criminal prosecutions in certain cases, have demonstrated the U.S. government’s aggressive stance toward reducing corruption at home and abroad.

For this reason, and as a matter of good business practice, U.S. organizations should quickly adopt an internationally recognized set of anti-bribery anti-corruption standards. Foremost among such initiatives is ISO 37001:2016 – Anti-Bribery Management Systems standard, providing a comprehensive approach to mitigating the risk of bribery and corruption. Companies will find that ISO 37001 and its essential elements can be tailored to their organization, regardless of the organization size or industry. Among its many features, ISO 37001 promotes implementing an anti-bribery policy, appointing a person to oversee anti-bribery, compliance, training, risk assessments, and conducting due diligence on projects and business associates. Implementing financial controls and instituting reporting and investigation procedures are also key within the ISO 37001 framework.

U.S. Losing Ground on Corruption

The result might be surprising for those who expect the U.S. to score near the top of the most recent Transparency International Corruption Perceptions Index. Canada ranks higher, and the U.S. score of 69 marks a two-point drop from the previous year – earning its worst score in eight years. [1]. “The U.S. faces a wide range of challenges, from threats to its system of checks and balances, and the ever-increasing influence of special interests in government, to the use of anonymous shell companies by criminals, corrupt individuals and even terrorists, to hide illicit activities.” The Americas do not get a glowing review from T.I.: “With an average score of 43 for the fourth consecutive year on the Corruption Perceptions Index (CPI), the Americas region fails to make significant progress in the fight against corruption.”

Transparency International’s frank assessment of the U.S.’s standing among other countries and regions in terms of corruption is useful. It helps dispel the notion held by some that bribery, fraud and other misconduct are primarily “third-world problems” that don’t impact large first-world economies. The fact is, large Western companies that seek to expand into new markets, including underdeveloped regions, are often guilty and liable for the corrupt practices that some employees or contractors might employ to advance that growth. Not only is that a problem in itself for its illegality and the damage often inflicted on economies in those areas, but it also creates serious legal and financial peril for companies that are caught and punished for violating the FCPA (as well as other international laws such as the U.K. Bribery Act).

Bribery Cases Prosecuted in the U.S. 

Among the cases involving U.S. companies that were investigated, prosecuted, and/or resolved in 2019, a few stand out as clear warnings that punishment is catching up to those who commit bribery and collusion. Household names like Microsoft and Walmart make a list, and smaller organisations and even individuals who faced fines and, in some cases, custodial punishments.

Microsoft was fined $23 million in combined criminal and civil penalties after a subsidiary, Microsoft Hungary, was investigated for a bid-rigging and bribery scheme. According to court documents, the alleged violations lasted from 2013 until “at least 2015,” according to court documents. The action was brought by the U.S. Department of Justice (DOJ) and the SEC for the sale of Microsoft software licenses to Hungarian government agencies. Microsoft Hungary executives and other employees were found to have violated the FCPA by falsely representing large “discounts” to close deals with resellers. The SEC also found that Microsoft’s subsidiary in Turkey “provided an excessive discount to an unauthorised third party in a licensing transaction for which Microsoft’s records do not reflect any services provided.” [3]

Walmart has been embroiled for more than 10 years in allegations of making corrupt payments to governments and officials worldwide, according to an agreement the massive corporation reached with the DOJ and SEC. Walmart agreed to pay $282 million to settle charges that violated the FCPA to open new locations in various countries and jurisdictions around the world. In court, Walmart’s Brazilian subsidy pleaded guilty to breaking U.S. federal law. On the whole, allegations include cases in Mexico, China, India and other locations. According to federal investigators, Walmart looked the other way as its subsidiaries on three continents paid millions of dollars, between July 2000 to April 2011, to middlemen in order to help the company obtain permits and other government approvals.

Lesser-known companies also faced scrutiny and, in some cases, prosecution. Juniper Networks, a California-based cybersecurity firm, was ordered by the SEC to pay more than $11.7 for FCPA violations. According to the SEC investigation, some of the sales employees in Juniper’s Russian subsidiary “secretly agreed with third-party distributors to fund leisure trips for customers, including government officials through the use of off-book accounts.” It is notable that Juniper did not explicitly admit nor deny the SEC’s claims in coming to terms for the settlement – but the company agreed to “cease and desist from committing or causing any violations.”

Some significant DOJ and SEC actions targeted individuals. For example, Hawaiian resident Frank James Lyon, 53, was charged and pleaded guilty to conspiracy to violate the anti-bribery provisions of the FCPA, as well as conspiracy to commit federal program fraud, after trying to bribe government officials in the Federal States of Micronesia. Lyon, a Hawaii-based engineering and consulting company owner was sentenced to 30 months in prison, followed by three years of supervised release. “According to admissions made as part of his plea agreement, between 2006 and 2016, Lyon and his co-conspirators paid bribes to foreign officials in the Federated States of Micronesia (FSM) and Hawaii state officials in exchange for those officials’ assisting Lyon’s company in obtaining and retaining contracts valued at more than $10 million. The bribes included, among other things, cash to FSM officials and Hawaii officials, and vehicles, gifts and entertainment for FSM officials.”

The cases above make clear that U.S. corporations and business leaders are vulnerable to bribery and corruption schemes that are often considered endemic in certain other regions of the world. The DOJ, SEC and other regulatory and investigatory bodies are scrutinizing transactions and behaviors, and conduct that runs afoul of provisions in the FCPA are likely to be met with prosecution and fines.

ISO 37001:2016 to Combat Bribery & Corruption

Corruption is a global problem. In the U.S., business and government leaders are urging organizations to take action now to reduce their risk exposure. To implement best practices and better protect themselves, organizations have found ISO 37001:2016 Anti-Bribery Management Systems standard. Issued by the International Organization for Standardization (ISO) in 2016, ISO 37001 helps organizations of all sizes and industries increase and measure their efforts against bribery and corruption. Organizations can use the principles provided by ISO 37001 to implement the highest integrity standards at every level. At its core, ISO 37001 calls for an organization to establish an anti-bribery policy and appoint a person to oversee anti-bribery compliance, training, risk assessments and due diligence on projects and business associates. The organization must also implement robust internal controls and reporting procedures, and investigation processes to help make ISO 37001 truly effective.

ABAC® (Anti-Bribery and Anti-Corruption) Center of Excellence Limited was founded by international security firm CRI® Group to help organisations of all types and industries implement the highest standards of training and Certification. With a team of experts around the world, ABAC® Center of Excellence is composed of certified ethics and compliance professionals, financial and corporate investigators, forensic analysts, certified fraud examiners, qualified auditors, and accountants. Through their training and experience in implementing ISO 37001 standards, ABAC® Center of Excellence’s agents helps clients more effectively prevent bribery and corruption. As an accredited provider of ISO 37001 ABMS, ABAC® Center of Excellence provides Certification and training for various types and industries organizations.

There are many elements of a comprehensive anti-bribery anti-corruption system. ISO 37001 lays these out in detailed guidance. The following are just a few of the elements of bribery that are addressed by ISO 37001:

• Bribery in the public, private and not-for-profit sectors
• Bribery by the organization
• Bribery by the organization’s personnel acting on the organization’s behalf or for its benefit
• Bribery by the organization’s business associates acting on the organization’s behalf or for its benefit
• Bribery of the organization
• Bribery of the organization’s personnel in relation to the organization’s activities
• Bribery of the organization’s business associates in relation to the organization’s activities
• Direct and indirect bribery (e.g. a bribe offered or accepted through or by a third party)

Benefits of ISO 37001:2016 Certification 

ISO 37001:2016 certification is designed to help protect the organization, its assets, and shareholders from bribery and corruption. Because Certification must be completed by a qualified, independent third party, it adds a distinct level of credibility to the organization’s management system. It ensures that the organization is implementing a viable anti-bribery management program using widely accepted controls and systems.

Companies and government organisations can rely on best practices set out by ISO 37001’s standards to reduce the risk of bribery and corruption. The following are some of the ways ISO 37001 helps organisations accomplish this goal:

• Provides needed tools to prevent bribery and mitigate related risks
• Helps an organisation create new and better business partnerships with entities that recognise ISO 37001 certified status, including supply chain manufacturing, joint ventures, pending acquisitions and co-marketing alliances
• Potentially reduces corporate insurance premiums
• Provides customers, stakeholders, employees and partners with confidence in the entity’s business operations and ethics
• Provides a competitive edge over non-certified organisations the organisation’s industry or niche
• Provides acceptable evidence to prosecutors or courts that the organisation has taken reasonable steps to prevent bribery and corruption

ISO 37001 certification should not be considered “legal cover” for all liability issues related to bribery – but it can be a mitigating factor: “Conformity with (ISO 37001) cannot provide assurance that no bribery has occurred or will occur in relation to the organization, as it is not possible to eliminate the risk of bribery,” according to ISO. ISO 37001 certification can be considered an important piece of evidence, however, demonstrating to regulators, prosecutors, and the courts that the organization has taken meaningful action to prevent bribery and corruption.

Costs and Timeframes of ISO 37001:2016 Certification

The time and cost of Certification depend on the size of the organization, as well as the state of its existing anti-bribery management system. If it’s very well developed, the process will be shorter and the organization can showcase it to their stakeholders and third parties. For organizations that don’t already have developed good policies, training and due diligence, the standard provides requirements and guidance on how to achieve it.

Some major corporations are seeking Certification. Microsoft, whose prior compliance issues were highlighted earlier in this paper, is reportedly one of them: Microsoft’s Deputy General Counsel, David Howard, wrote that “Microsoft will seek Certification from an independent and accredited third party to demonstrate that our anti-bribery program satisfies the requirements of the standard. We hope other companies will do the same.”

Conclusion

Regulators and enforcement bodies in the U.S. have prioritized rooting out fraud and other financial crimes. Bribery and corruption are at, or near, the top of this list. Investigations and prosecutions have increased in recent years and will continue to do so. Against this backdrop, it is critical that U.S.-based companies, corporations and government organizations take action now to reduce their risk profile and be better protected from liability. ISO 37001 is a perfect first step – or, for some, a next step – toward increasing that level of protection.

ISO 37001 ABMS provides the training and Certification program that organizations need for accountability and effectiveness. The training process can be tailored based on the size, type, industry or risk level. Bribery and corruption are not exclusive to the third world or developing economies. They are pervasive in Western countries, including the U.S., and they require comprehensive measures to make an impact and lessen their effects. ISO 37001 provides solutions that any organization can implement – not tomorrow, but today. The positives of decreased risk, decreased liability and better financial protection outweigh any negatives of the minimal investment in cost and effort.

CONTACT INFORMATION

Zafar Anjum, MSc, MS, CFE, CII, MICA, Int. Dip. (Fin. Crime) | CRI Group™ Chief Executive Officer

7th Floor, South Quay Building, 77 Marsh Wall, London, E14 9SH United Kingdom

t: +44 207 8681415 | m: +44 7588 454959 | e: zanjum@crigroup.com

References

1. “Corruption Perceptions Index 2019,” Transparency International, 2020 <https://www.transparency.org/cpi2019> (accessed 10 Feb. 2020)
2. “CPI 2019: AMERICAS,” Transparency International, 23 Jan. 2020 <https://www.transparency.org/news/feature/cpi_2019_Americas> (accessed 10 Feb. 2020)
3. Jaclyn Jaeger, “Microsoft to pay $25M in FCPA case,” Compliance Week, 23 July 2019, <https://www.complianceweek.com/anti-corruption/microsoft-to-pay-25m-in-fcpa-case/27446.article > (accessed 10 Feb. 2020)
4. Michael Corkery, “A ‘Sorceress’ in Brazil, a ‘Wink’ in India: Walmart Pleads Guilty After a Decade of Bribes,” The New York Times, 20 June 2019, <https://www.nytimes.com/2019/06/20/business/walmart-bribery-settlement.html > (accessed 10 Feb. 2020)
5. “SEC fines Juniper Networks more than $11.7 million to settle internal control violations,” Reuters, 28 Aug. 2019,< https://www.reuters.com/article/us-usa-sec-fcpa/sec-fines-juniper-networks-more-than-11-7-million-to-settle-internal-control-violations-idUSKCN1VJ2OD > (accessed 11 Feb. 2020).
6. “U.S. Executive Sentenced to Prison for Role in Conspiracy to Violate Foreign Corrupt Practices Act,” U.S. Department of Justice, 14 May 2019,< https://www.justice.gov/opa/pr/us-executive-sentenced-prison-role-conspiracy-violate-foreign-corrupt-practices-act> (accessed 10 Feb. 2020)
7. “ISO 37001:2016 ANTI-BRIBERY MANAGEMENT SYSTEMS — REQUIREMENTS WITH GUIDANCE FOR USE”, www.ISO.org, < https://www.iso.org/standard/65034.html > (accessed 5 Aug. 2019)
8. David Howard, “An update on Microsoft’s approach to compliance,” Microsoft, 7 Mar. 2017, < https://blogs.microsoft.com/on-the-issues/2017/03/07/update-microsofts-approach-compliance/ > (accessed 17 Feb. 2020)

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