The Anti-Corruption Handbook: How to Protect Your Business in the Global Marketplace

Table of Contents:
Preface xiii About the Contributors xvii Chapter 1 Managing Corruption Risk 1 You are Not Alone 2 Bribery and Kickbacks 2 Economic Espionage 2 Money Laundering 3 Developing Effective Compliance Programs 3 Performing Due Diligence 4 Chapter 2 What is Anti-Corruption? 5 Anti-Corruption Detection and Prevention 5 Critical Elements of an Effective Compliance Program 6 Governance and Oversight 9 Chapter 3 U.S. Efforts to Combat Global Corruption 11 The Emergence of Nongovernment Organizations 12 World Trade Organization 13 Global Forum on Fighting Corruption 13 International Financial Institutions 14 International Chamber of Commerce 15 Transparency International 15 Global Corporate Governance Forum 15 The Role of Civil Society 16 The Emerging Markets 16 Chapter 4 U.S. Laws Governing Corruption 19 Racketeer Influenced and Corrupt Organizations Act 19 RICO Offenses 20 Sherman Antitrust Act 21 Anti-Kickback Act of 1986 22 Economic Espionage Act of 1996 23 Chapter 5 The Evolution of the Foreign Corrupt Practices Act 27 Background 27 Anti-Bribery Provisions 29 Third-Party Payments 31 Facilitating Payments 32 Sanctions against Bribery 33 Chapter 6 Internal Controls and Accounting Provisions of the FCPA 35 FCPA Accounting Provisions 36 Failed Controls 36 Controls Assessment 37 Conclusion 38 Case Study: Rolling on a River 39 Chapter 7 Do Not Crimp: The Need for Oversight of Foreign Operations 43 Pitfalls of Emerging Markets 44 Monitoring Behavior 45 Education and Communication 46 Extending the Tone from the Top beyond the Borders 47 Case Study: Bribes in the USSR 47 Chapter 8 The Human Factor 49 Why Focus on Fraud and Corruption Risk? 50 Behavioral Root Causes of Fraud and Corruption 50 Psychology of Fraud Perpetrators 51 Understanding Management Fraud 51 Approaches to Deterring and Mitigating Financial Fraud Risk 52 Chapter 9 Corporate Governance: The Key to Unmasking Corrupt Activity 55 Enterprise Risk Management: Create Stronger Governance and Corporate Compliance 55 Mitigating Risk 57 Ascertain Risk Areas 58 Establishing Procedures to Mitigate Risk 59 Perform a Periodic Assessment 60 Blowing the Whistle on Corporate Fraud 60 Chapter 10 Whistle-Blower Programs 61 Pulling Out the Earplugs 62 Understanding Stakeholders and Their Needs 63 Steps of the MACH Process 67 Monitoring the MACH Process 78 Conclusion 79 Appendix 81 Chapter 11 Document Retention 83 Create, Communicate, Monitor 84 Reduce Risk through Technology 84 Computer Crime 85 The Most Common Computer-Related Crimes 85 The Value of Stored Data 86 Chapter 12 Information Security: Intellectual Property Theft is Often the Result of Government Corruption 87 Information Security Audit 89 Classification of Information 89 Division of Responsibilities and Duties is an Effective Strategy in Protecting Trade Secrets 90 Information Security Control Officers or Custodians 90 Use of Confidential or Proprietary Markings 91 Document Destruction 91 Education and Training 91 Background Checks 92 Confidentiality Agreements 92 Employee Orientation 92 Separation Plans 93 Physical Security 94 Systems Security 95 E-Mail Policy 99 Internet Policy 100 Solicitations for Information 100 Seminar/Tradeshow/Off-Site Meetings Policy 101 Joint Venture/Vendor/Subcontractor Procedures 101 Contractual Provisions with End Users 102 Action Plans 103 International Protection Issues 104 Information Security Policy 104 Chapter 13 Anti–Money Laundering: The USA PATRIOT Act 105 Current State of AML in the Global Marketplace 106 Case Study: The Boys from Brazil 109 Chapter 14 Procurement Fraud: Detecting and Preventing Procurement and Related Fraud 111 Kickbacks 112 Vendor Fraud 113 Bid Rigging 113 Defective Pricing and Price Fixing 114 Contract Fraud 116 Cost/Labor Mischarging 118 Case Study 1: Employee Fraud 120 Case Study 2: Vendor Kickbacks and Collusion 121 Conclusion 121 Chapter 15 Construction Fraud: Monitoring, Mitigating, and Investigating Construction Fraud 123 Common Construction Company Fraud Schemes 124 Combating Fraud and Corruption 126 Strengthen Your Internal Controls 126 Chapter 16 Special Investigations: How to Investigate Allegations of Corruption 129 An Interested Party: The Auditor 130 The Special Investigation 132 Chapter 17 Navigating the Perils of the Global Marketplace 135 FCPA Enforcement 135 Record Keeping 138 Data Collection and Processing 139 Transborder Data-Flow Issues 139 Chapter 18 Case for Collective Action: The World Bank Initiative 143 Why Collective Action against Corruption? 143 Different Views of Corruption 144 Business Costs of Corruption 144 Costs of Corruption for Industries, Economies, and Countries 145 Different Views of the Private Sector 145 Corruption Dilemma 146 Chapter 19 Leveling the Playing Field 157 Book Research Summary 161 Index 165

About the Author :
WILLIAM P. OLSEN, CFE, CGFM, CIA, is Principal in the Advisory Services practice and National Practice Leader of Investigations at Grant Thornton LLP, the fifth largest and fastest growing global accounting firm. He provides anti-corruption consulting services to clients around the world, performing numerous investigations involving money laundering, organized crime and corruption, due diligence, and computer forensics. He has also consulted numerous organizations on developing policies, controls, and procedures to assure compliance with government regulations.