In the aged of social media and the explosion of mobile technology, corporations

Question

In the aged of social media and the explosion of mobile technology, corporations and regulators are faced with new challenges when developing effective compliance risk mitigation programs and internal safeguards to protect against internal and external threats of corruption and fraud. According to Keith Darcy an Independent Senior Advisor at Deloitte, the big 5 accounting and consulting firm, “Good Enough” is just no longer good enough. 1. Explain the 5 factors that, according to Mr. Darcy, are the key differentiators in the highestperforming compliance programs 2. Provide a summary of BNP Paribas (“BNP”) and Credit Swiss’ overall legal challenges including a tally of all fines the companies will have to settle with regulators and or other government authorities Contrast BNP and Credit Swiss situation to that of JP Morgan or any other case that you may know or that may be of interest to you 3. Discuss the merit of the US government’s case against these three financial institutions 4. Discuss whether in this contest these banks should keep their banking license in the United States? Are banks too big to fail?

Explanation / Answer

According to Mr. Darcy, 5 key differentiators in the highest performing programs are as following. I wanted to write the below points in own language of Mr. Darcy hence have not described it in my own language so that it do not lose its meaning. I have taken these points from the following link:

http://deloitte.wsj.com/riskandcompliance/2014/04/14/ethics-and-compliance-programs-moving-from-good-enough-to-great/?mod=wsjrc_hp_deloitte

You should visit the above said website to get the better understanding.

By themselves, none of the above differentiating factors can protect organizations from ethics and compliance breaches. But, when they are part of an organization’s fabric and way of doing business, there’s a better chance of moving from “good enough” to “great” and becoming an organization that attracts the trust and admiration of employees, customers, investors, regulators and other stakeholders alike.

Answer 2

BNP Paribas

BNP Paribas, a France based bank, was found guilty with two criminal charges. BNP Paribas failed to process billions of dollars of transactions between 2002 and 2012 for groups in Sudan, Iran and Cuba. According to US regulators these groups were involved in terrorism and genocide. It also systematically concealed the transactions to evade US sanctions. Therefore, US regulators banned BNP for a year and conducting certain US dollar transactions and also imposed almost $9 billion to resolve accusations it violated U.S. sanctions against Sudan, Cuba and Iran. US Government are also seeking to punish individual employees.

Credit Swiss

In the case of Credit Swiss, which recently created a subsidiary to house the “U.S. offshore business,” prosecutors have privately indicated that they are unwilling to charge the newly formed unit. As for BNP, the bank made the pitch that a guilty plea could affect the broader economy outside of France. But prosecutors pushed back, in part over concerns that BNP did not fully cooperate with the investigation.

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