Posts tagged ‘david riker’
Reducing C-Level Risk in Compliance Land
By David Riker
Published January 31, 2012 in FCPA Blog
The CEOs, CFOs, COOs and Chief Compliance Officers we meet with are well aware of the FCPA and are working to put in place compliance programs to keep their companies on the right side of the law, but they are not terribly concerned about their own personal exposures. Their logic: If I’m not physically handing over a bag of money to a corrupt government official, I’m clean.
This, of course, is not true. According to this great analysis from Chadbourne & Parke (in pdf here), 53 of the 61 individuals charged with violating the FCPA over the past six years were senior corporate officers, not bag men. Moreover, 8 of these individuals were charged despite committing no direct action in the corrupt act.
To read the complete article on FCPA Blog, click here
Bubble Risk 2.0: This Time it’s More Than Money on the Line
By David Riker
Managing Director, Kroll Risk and Compliance
There’s a new Internet bubble forming, fueled by the insatiable appetites of investors racing for inclusion in the next LinkedIn or Groupon. Case in point, December’s $1 billion Zynga IPO, which fell 5% on its first day of trading.
Describing the phenomenon in Fortune magazine, Steve Blank wrote:
We’re now in the second Internet bubble. The signals are loud and clear: Seed and late-stage valuations are getting frothy and wacky, and hiring talent in Silicon Valley is the toughest it’s been since the dotcom bubble. The rules for making money are different in a bubble than in normal times.
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US Chamber of Commerce Seeing Red on FCPA Red Flags
By David Riker
Managing Director, Kroll Risk and Compliance
We’ve cited a number of news stories over the past several weeks that reference the US Chamber of Commerce’s lobbying effort to amend the Foreign Corrupt Practices Act (FCPA). One of the Chamber’s central issues with the FCPA is that it “should be modified to make clear what is and what is not a violation.”
This lack of clarity issue has come up frequently in the Chamber’s published documents and press statements, suggesting that US multinationals are unclear what activities separate corruption from standard business practice.
Beyond FCPA: When Foreign Fraud Dilutes a Brand
By David Riker
Managing Director, Kroll Risk and Compliance
We spend a lot of time on FCPAlert discussing the concrete impacts of foreign fraud, such as the increase in FCPA-related investigations and fines, new due diligence required to vet third parties and the cost of doing business in high risk emerging markets. But we’ve yet to discuss an equally troubling problem: the dilution of brand value that can result from doing business in fraud-prone regions of the world.
This is a huge problem. According to a recent report by the Organization for Economic Cooperation and Development, the impact of counterfeiting and piracy on the global economy is over $600 billion, approximately 5-7% of world trade. And the problem cuts across all industries. The US FDA estimates that 10% of all prescription drugs sold globally are counterfeited; the FAA projects that 2 percent of all airplane parts installed each year are counterfeit; and the Consumer Electronics Association reports that 3% of parts found in mobile devices are counterfeit.
Citizenship by Investment: How Due Diligence Can Open Up the US Economy
By David Riker
Managing Director, Kroll Risk and Compliance
In his new book, Borderless Economics, Robert Guest, the global business editor at The Economist makes the case that the single biggest threat to America’s status as an economic superpower is the growing backlash against immigration.
Citing the recent growth in scientific and innovative output from emerging markets such as China and India, Guest notes that in 1990, the “old” rich countries – North America, Europe and Japan – accounted for more than 95 percent of the world’s scientific research. By 2007 that had fallen to 76 percent. While the US is well-placed to capitalize on the growth in these and other emerging markets through cross-border investment and collaboration, immigration policy is getting in the way. Guest notes:
Until recently, America’s technological prominence was based on a simple formula: The world’s best brains came to the United States… Migrants make up about half of the workers in the United States with science or engineering qualifications, and accounted for two-thirds of the growth in that talent pool between 1995 and 2006. Half of the bosses of Silicon Valley start-ups in 2005 were migrants…
Riker in Chief Executive
David Riker’s op-ed “So You Want to be a Multinational?” has been published by Chief Executive. To read the full article, visit ChiefExecutive.net by clicking here.
So, You Want to be a Multinational?
David Riker
Managing Director, Kroll Risk and Compliance
The Siren song of emerging markets is calling out louder than ever for small- to medium-sized companies in mature economies. Labor, talent, R&D costs and regulatory compliance are all obviously far less expensive in places such as China, Russia, India, South Africa and Central and South America. Moreover, the consumer economies in these regions are experiencing transformational growth while the US, Europe and Japan are in decline.
But global expansion comes with global risk. As more and more firms expand their supply chains into high-risk emerging markets – often using networks of vendors and agents to rapidly put boots on the ground in these regions – they are increasingly exposed to the kinds of fraud risks that can sink their global aspirations.
