forensics: regional trends in anti-corruption legislation and corporate best practices securing asia...

©2012 Deloitte & Touche GmbH Wirtschaftsprüfungsgesellschaft

Forensics

Regional Trends in Anti-Corruption Legislation and Corporate Best Practices

Securing Asia 2013


Deloitte at a glanceGlobal presence – proximity to clients

2

Americas85,000 employees

Europe/Middle East/ Africa68,000 employees

Asia Pacific40,000 employees

Global presence with 193,000 employees

Audit

Consul-ting

CorporateFinance

TaxMulti-

disciplinaryservices

Corporate Finance

SpecialistAdvisory Services

TransactionServices

Actuarial &Insurance

Services

CorporateFinance

Advisory

Restructuring Services

Forensic & Dispute Services


Forensic & Dispute ServicesOur Team

3

Competent and experienced in assisting clients in investigating cases of white collar crimes.

Multidisciplinary environment using auditors, tax accountants, attorneys, criminalists and computer scientists in our teams.

Present in Germany with 60 specialists frequently deployed on international assignments.

Represented globally with approximately 1,600 F&DS-colleagues.

Corporate Finance

Valuation Services

TransactionServices

BusinessModeling

CorporateFinance

Advisory

Reorganisation Services



Anti-FraudManagement(AFM)

Forensic Investigations

Anti-MoneyLaundering

(AML)

Dispute & Litigation

Support

Business Intelligence

Services (BIS)

Analytic ForensicTechnology (AFT)


Forensic & Dispute ServicesOur range of services - Overview

4

Analytic Forensic Technology (AFT)

Business Intelligence Services (BIS)

Anti-Fraud Management (AFM)

Anti-Money Laundering Services (AML)

Dispute & Litigation Support

Forensic backup, recovery, processing and analysis of digital data.

Gather and prepare background information on natural and legal persons using publically available sources with strict adherence to current data protection regulations.

Identify control weaknesses in the company´s business process that foster or make financial crimes possible. Support with the development and implementation of prevention and detection measures.

Introduction of money laundering prevention systems and its subsequent integration into the internal control system.

Support (consultants, experts) at judicial and out of court disputes/conflicts.

Fraud InvestigationsInvestigations of fraud and other types of criminal and unethical activity, including embezzlement, breach of trust, bribery and corruption and balance sheet manipulation.


Forensic & Dispute ServicesFraud Investigations

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We support clients with:

Investigations of suspected cases of fraud, embezzlement, breach of trust, corruption and money laundering.

Clarification of manipulation of internal and external accounts and annual financial statements.

Tracing of assets to enforce claims.

Legally actionable preparation of facts and results.

Collaboration with law enforcement agencies (prosecutors and police) as well as other authorities.

Supporting clients improving controls and taking precventive steps to mitigate risks

Suspicion

Assignment

Investigation

Report

Reaction



Forensic & Dispute ServicesAnti-Fraud Management (AFM)

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Preparation of risk analyses in the area of fraud prevention.

Analysis of sensitive business processes for weaknesses and risks.

Design and implementation of Anti-Fraud Management in your company.

Training of employees and senior management.

Development and implementation of tailored emergency and reaction plans.

Fraud Risk Assessment

Measures for prevention

Measures for exposure

Introduction of a monitoring and

reporting system

Transfer to normal operation


Forensic & Dispute Services Anti Money Laundering Services (AML)

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Preparation of risk analyses in the area of money laundering.

Implementation of money laundering prevention systems and their integration in the internal control system.

Examination and assessment of the internal control environment and the risk management process from the point of view of money laundering prevention or the adherence to embargo regulations(e.g. OFAC- and EU-Sanctions).

Issues of legal regulations relating to money laundering and terrorist financing.

Conception and realization of training measures for staff.

Implementation of customer-due-diligence procedures.

Create a compliance department

Money Laundering

Expansion of money laundering typologies

Implement the Know Your Customer principle

Modify anti-corruption-system with regard to money laundering aspects

Report suspected offences


• Documentation techncally usable in court proceedings

• Traceability and reproducibility

Forensic & Dispute Services Analytic Forensic Technology (AFT)

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Court usable collection, analysis and provision of all digital storage media with special consideration of data protection laws/regulations (Computer Forensics).

Intelligent processing and management of digital mass data (i.e. e-mail correspondence) to better facilitate the identification of evidence and pieces of circumstantial evidence (Electronic Discovery).

Extraction, analysis and client specific preparation of digital accounting mass data, i.e. SAP accounting data, Oracle database. In doing so, domain crossing data analysis methods from statistic and pattern matching to analyze large data pools are used (Data Analytics).

Special IT-services, like individually adjusted documentation management systems, OCR-Services (Litigation Support).

Project planning

Data gathering

Data analysis

Reporting

Entire process: Chain of Custody


Typical Applications

• Information gathering on suspicion of fraud, breach of trust and corruption

• Background check on possible suppliers, business partners and joint-venture partners

• Element of Integrity Due Diligences• Standardized check within the scope of Know Your

Customer processes • Support where there is indication of industrial espionage

and or product piracy• Defense of Competitive Intelligence: analysis of

vulnerabilities• Country Risk Analysis/Political and Security Risk

Analysis

Forensic & Dispute Services Business Intelligence Services (BIS)

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Gathering of information on corporate entities and individuals in order to provide clients with a comprehensive understanding of their business partners.

Identification of potential risk factors.

Selection of employees (Pre-Employment Due Diligence).

Preparation of country reports.

Project-specific research and investigations worldwide.


Forensic & Dispute ServicesDispute & Litigation Support

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Enforcement or defense of compensation claims (juridical or out of court).

Enforcement of insurance claims (including claims of fidelity insurance, D&O, business interruption).

Arbitrator or arbitration court appointed assessor services .

Evidence of violation of duties by corporate bodies.

Measures to protect clients’ intellectual property.

We support you with solving complex national and international disputes through preparation of the facts and gathering court usable results (evidence) for example in cases of:

• Contract disputes • Severance payment disputes of former shareholders• Insurance claims • Corporate body liability cases• Patent infringements

Application possibilities

©2012 Deloitte & Touche GmbH Wirtschaftsprüfungsgesellschaft11

Key Observations

• Numerous countries either in the process of tightening anti-bribery laws or debating such legislation

• Potentially significant reputational risks for business

Increased focus on bribery and corruption issues shaping public debate

• Companies are frequently unaware of the global reach of US and UK based legislation and therefore fail to reassess their risk exposure when expanding their operations

• Other legislations (e. g. PRC) may potentially have international applicability but are currently difficult to assess.

Limited awareness of international regime and potential sanctions

• Companies have to manage risks from both global and local / regional regimes which are still under development.

• Increasing complexity means managing compliance risks is both necessary and economically challenging

Growing regional business activities as a driver of GDP growth


Key Internationally Applied Legislation

US Foreign Corrupt Practices Act (FCPA)

UK Bribery Act 2010

Applicability US nexus UK nexus

Scope Limited to „public officials“ Applies to both the public and the private sector but excludes political parties and their officials.

Requisite for Liability Wilful and knowing act. Also wilful blindness / disregard.

Bribery of foreign officials requires the intent to influence a decision. Corporate offense of „failure to prevent bribery“. Only defense is adequate system of controls.

Activity Active bribery Active and passive bribery

Exceptions Yes (but of limited practical value) No


International Enforcement

US authorities continue to enforce the provisions of the Foreign Corrupt Practices Act (FCPA). Enforcement action for 2013 up to this point included:

• Total S.A. - SEC charged the France-based oil and gas company for paying bribes to intermediaries of an Iranian government official who then exercised his influence to help the company obtain valuable contracts to develop oil and gas fields. Total agreed to pay $398 million to settle SEC and criminal charges. (5/29/13)

• Ralph Lauren Corporation - SEC announced a non-prosecution agreement (NPA) with Ralph Lauren Corporation in which the company will disgorge more than $700,000 in illicit profits and interest obtained in connection with bribes paid by a subsidiary to government officials in Argentina from 2005 to 2009. (4/22/13)

• Parker Drilling Company - SEC charged the worldwide drilling services and project management firm with violating the FCPA by authorizing improper payments to a third-party intermediary in order to entertain Nigerian officials involved in resolving the company's customs disputes. Parker Drilling agreed to pay $4 million to settle the SEC's charges. (4/16/13)

• Koninklijke Philips Electronics - SEC charged the Netherlands-based health care company with FCPA violations related to improper payments made by employees at its Polish subsidiary to health care officials in Poland. Philips agreed to pay more than $4.5 million to settle the charges. (4/5/13)

Source: http://www.sec.gov, June 23 2014

http://www.sec.gov/


Corporate Best Practices

1. Prevention

• Code of Conduct

• Operational Guidance / Blacklisting

• Ongoing Risk Analysis

• Capability Reviews

2. Detection

• Proactive Identification of High-Risk Activities

• Data Mining

• Targeted Audits

• Reporting System

3. Response

• Investigation Policies and Procedures

• Investigative Capabilities (internal or external)

• Preparation for Incidents

An ability to demonstrate compliance risk management standards can be a significant competitive differentiator in dealing with US or European business partners.


Contact Details

Deloitte & Touche GmbHDammtorstrasse 1220354 Hamburg

Dr. Christoph Rojahn GermanyDirectorForensic Services Phone + 49 40 32080 4747

Mobile: +49 151 [email protected]

Member ofDeloitte Touche Tohmatsu

Deloitte & Touche GmbHDammtorstrasse 1220354 Hamburg

Dr. Christoph Rojahn GermanyDirectorForensic Services Phone + 49 40 32080 4747

Mobile: +49 151 [email protected]

Member ofDeloitte Touche Tohmatsu


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This presentation contains general information only, and none of Deloitte & Touche GmbH Wirtschaftsprüfungsgesellschaft or Deloitte Touche Tohmatsu Limited (“DTTL”), any of DTTL’s member firms, or any of the foregoing’s affiliates (collectively the “Deloitte Network”) are, by means of this presentation, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This presentation is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your finances or your business. Before making any decision or taking any action that may affect your finances or your business, you should consult a qualified professional adviser. No entity in the Deloitte Network shall be responsible for any loss whatsoever sustained by any person who relies on this presentation.

© 2012 Deloitte & Touche GmbH Wirtschaftsprüfungsgesellschaft

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http://www.deloitte.com/de/UeberUns

forensics: regional trends in anti-corruption legislation and corporate best practices securing asia...

Technology

range of services

area of money laundering

money laundering aspects

area of fraud prevention

implementation of prevention

fraud risk assessment

prevention measures

support consultants