This is the eighth in a series of articles intended to assist organizations in assessing their anti-corruption programs through the lens of the 10 hallmarks of an effective compliance program as set forth in “A Resource Guide to the U.S. Foreign Corrupt Practices Act” (“the Guide”), jointly published by the U.S. Department of Justice and the Securities and Exchange Commission in November of 2012. This article centers on hallmark number eight:
Confidential Reporting and Internal Investigation
A thoughtfully conceived and well-implemented anti-corruption program will produce various categories of alerts or “red flags” that require investigation. An important mechanism of your program is providing the means for individuals to communicate confidentially any suspicions or allegations of improper or illegal acts.
Typically, companies will contract with an outside party that provides hotline and issue-tracking services, allowing individuals to provide information about suspected misconduct on a confidential basis. While some callers (or emailers) may request anonymity, often anonymity can inhibit the company’s ability to investigate an allegation fully. Many organizations encourage tipsters to provide information instead on a confidential basis, giving the company latitude to re-engage and ask follow-up questions as an investigation progresses.
Since so much of an anti-corruption program is geared toward the establishment of a framework to generate red flags, it is vital for the company to have a protocol for the intake, triage, investigation and disposition of any allegations received. An investigative protocol is an outline of the steps to be taken as part of the investigation and the resulting documentation. Equally important is the designation of who is responsible for the investigation, who from legal or compliance will oversee it and how additional steps will proceed should escalation be warranted based upon the findings.
The importance of ensuring you have appropriate subject-matter expertise both in the performance of an investigation and its supervision cannot be overstated. Some companies give short shrift to this critically important part of their program. Since the entire program is geared toward generating red flags, part of the government’s appraisal of its overall efficacy is ensuring you have allocated sufficient resources with the right skills to investigate them.
This article is part eight in a 10-part series exploring Anti-Corruption and the 10 Hallmarks of an Effective Compliance Program. Each piece in the series is based on a section from a whitepaper published by Protiviti, titled “Viewing Your Anti-Corruption Efforts Through the Lens of the Hallmarks of an Effective Compliance Program,” which is available in full at:http://www.protiviti.com/en-US/Documents/White-Papers/Internal-Audit/Viewing-Anti-Corruption-Efforts-Lens-Hallmarks-Effective-Compliance-Program-Protiviti.pdf
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Scott Moritz is a managing director at global consulting firm Protiviti Inc., where he leads the firm’s fraud, anti-corruption, and investigations practice, serving clients worldwide in a variety of industries.
A noted anticorruption strategist with more than 26 years’ experience, Moritz has been a top consultant in designing programs to help companies use risk scoring and technology to identify, investigate, and remediate high-risk relationships. He was instrumental in the development and launch of widely recognized anti-corruption platforms and due diligence products. Prior to joining Protiviti, Moritz served as a managing director for global investigations and compliance at Navigant. Before that, he spent four years as the head of the anti-corruption and investigative due diligence practice at Daylight Forensic & Advisory, which was acquired by Navigant in 2010. Previously, Moritz also held leadership positions KPMG, LLP, in two separate instances, most recently as a director of corporate intelligence for the firm’s forensics practice. His experience also includes senior roles at IPSA International, Inc., BDO Seidman, LLP, and PricewaterhouseCoopers, LLP.
Moritz spent 10 years serving as a special agent for the Federal Bureau of Investigation (FBI), where he gained extensive experience in complex investigations of multi-national criminal investigations that included organized crime, money laundering, fraud, corruption that often involved a variety of industries such as financial services, securities, insurance, and public and private services. He was a nationally recognized expert for the FBI on asset forfeiture investigations and money laundering.
Moritz graduated from the FBI Academy in Quantico, Va. He also holds a bachelor’s degree in marketing and management from Jacksonville University.