MANAGING A CROSS-BORDER INVESTIGATION
Fraud, bribery and corruption are some of the biggest, and potentially costly, challenges facing companies today. Financial crime hurts organisations, economies and people, often in the poorest parts of the world, and it is on the rise.
Fraud awareness within business is also growing, however. According to PwC’s 2018 Global Economic Crime and Fraud Survey, 49 percent of companies recognise that fraud is a growing concern, the highest level of awareness over the last 18 years. This recognition comes as part of an overall increase in economic crime around the globe.
For companies, regulatory bodies and law enforcement agencies, the challenge is to overcome malfeasance and bring criminals to justice. But the complexity of this task continues to grow. Today, fraud, corruption and bribery can be perpetrated digitally, in a matter of moments, at an unprecedented scale and via increasingly sophisticated means. The negative impact, in terms of lost revenue can be substantial. Personal and business reputations, market capitalisation and investor confidence can also be impaired.
Financial penalties could be substantial for any organisation or individual found to have committed a fraudulent act. Due to enforcement action carried out under the auspices of the Securities and Exchange Commission’s (SEC’s) Foreign Corrupt Practices Act (FCPA) and the Department of Justice (DOJ), 2019 is on track to see a record number of penalties handed down. In 2018, more than a dozen companies paid out $2.89bn to settle cases initiated under the FCPA, according to Risk Advisory’s annual Corruption Challenges Index survey. In the first quarter of 2019, the SEC and the DOJ racked up more than $1.1bn in total corporate penalties and disgorgement, resolving FCPA-related cases against four corporations and eight individuals during Q1.
Oct-Dec 2019 issue
Richard Summerfield