Tackling corporate compliance issues, corruption, anti-bribery legislation and money laundering

Corporate Compliance is a hot topic nowadays in Romania since private companies have an increasing interest in developing policies and procedures which are meant to protect them from potential situations of waste, fraud, and abuse, either intentional or unintentional. The subject was debated over a full day event in Bucharest at the Compliance Conference hosted by Wolf Theiss, Trace International, Ernst & Young and the US Embassy in Romania and proudly supported by GOVNET.

According to Bryan Jardine and Ileana Glodeanu, partners at Wolf Theiss, the enforcement of best practices in corporate compliance will become increasingly critical in order for Romania to be perceived as a mature and sophisticated market for those companies to do business here.

The need for a compliance program that is meant to combat fraud, money laundering, financial crime and environmental misconduct is highlighted by Burcin Atakan (Ernst & Young Partner), who is advising companies to adopt the methodologies that will ensure their position on the market as trustful and honest business partners.

According to official data, last year, over 200 people, more than a half of the definitively condemned for corruption acts, were coming from private companies. The efforts to tackle corruption should crystalize in prevention methods, but even after the act, the local regulation enforces certain mechanisms that could be used by the parties in order to correct the mistakes (for e.g., reducing the fines for money laudering with 50% in case of collaboration with the authorities) says Ileana Glodeanu. Moreover, Tom Firestone from Baker McKenzie claims the best protection against corruption investigations is to have a good internal control. 

According to Glodeanu, the main aspects a foreign investor is seeking to understand about a company are what kind of interactions it has had with the public sector (former employees of the state that are currently working for them), whether the state provided any sort of aid to it or its transaction partners, whether the business partners were investigated or not by the authorities, they analyze the their practices, guides, policies and codes, and they look at the training and education of the employees. Having a board that deals with compliance issues is a big plus. 

Another subject on the agenda was the example of FCPA (Foreign Corrupt Practices Act), the US law that tackles corrupt practices abroad and establishes the ruling for companies, clear audit methods and ensures protection to integrity supervisors, presented by Dean Thomson, the USA ad-interim business responsible and Devon Mahoney from FBI (Federal Bureau of Investigation), who assured their purpose is not to take companies off the market and cut jobs, but make them play fair. 

by Mihaela Constantin