Article at CFO.com: When Your Compliance Program Fails

cfo.comThe steps to take when an employee comes forward with a fraud tip, whether the allegations are false or not.

By Tracy Coenen, Contributor to CFO.com

You think your company has a robust compliance program to prevent financial-statement fraud, asset misappropriation, Foreign Corrupt Practices Act violations, and other financial frauds. There are checks and balances in place, with lawyers, internal auditors, executives, and the board of directors keeping an eye on things.

Still, the unthinkable happens. Reports of a major internal fraud surface, and the scheme may involve several members of middle or upper management. The information – received through an employee’s whisper, an internal hotline, or the rumor mill – has enough substance to be deemed credible, yet not enough to know exactly who is involved, how wide-reaching the fraud may be, the amount of money stolen, or the exposure to government action and penalties.

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CFO Magazine: Creating a Culture of Compliance

I was recently quoted in CFO Magazine for an article on creating an ethical culture within companies. Below are a few excerpts, including my comments.

In December, the federal government cited a “lax corporate control environment” at Alcatel, which extended right up to the CEO and CFO, as a primary cause of the scandal. It was a finding that more companies should take to heart.

Nearly a decade after the passage of the Sarbanes-Oxley Act, and amid heightened FCPA enforcement, the responsibility for shaping what is often called a “culture of compliance” inside U.S. corporations falls heavily on the C-suite — and, more than ever, on the CFO.

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