How to convince clients that compliance programs are important

Joe Murphy

by Joe Murphy

What do lawyers point to when they want to convince you that something is important?  Actual cases.  Cases that the government brought against violators.  Cases where the government demonstrated that they meant business. 

So how do we convince clients that compliance programs are important, and the government takes them seriously? How do we convince them that programs have to be genuinely robust?  The same way – we cite cases.  We cite the real world examples.

For year, now, government enforcement people in the US have been telling us compliance programs matter.  Now enforcers are saying this around the world.  They are also saying that only real programs matter.  Window dressing or sham or cosmetic programs don’t matter; real programs do.  So where are the cases that show this?

In the US, when we want to show that programs matter, and that they have to be serious, what cases do we cite?  Of course, we cite MorganStanley.  And what other cases do we cite?  Oops, we cite MorganStanley. 

Let’s say we want to cite a case that makes it clear that just having a code of conduct is not enough – you need more.  Where are the cases?  Over the past 20 years I have even found one!  But not in the US.  Not in Canada.  Not in Germany or the UK or Australia.  But I did find one on point – in the Czech Republic. 

Well, the government agencies do give us guidance – that is good.  There is plenty of that.  The Criminal Division of DOJ has issued questions.  The Antitrust Division has issued guidance.  The UK’s Serious Fraud office has issued guidance.  The Canadian Competition Bureau has issued strong guidance.  But where are the cases.  They tell us programs matter, but as an old ad campaign used to say, “where’s the beef?”  Where is an actual case where a company lost out because the compliance officer was really powerless and compromised.  Where is the actual case where a program had diminished value because it lacked any focus on incentives?  Where is the actual case where a program got extra credit because the CEO used and referred to the code of conduct and a senior officer was disciplined for failure to take reasonable steps to prevent or detect misconduct?

I have heard occasional excuses from government agencies for having no actual cases they could discuss, but they were never more than that – excuses.

But any trainer will tell you that nothing is more powerful than real world examples.  Even government guidance documents talk about the power of real world cases in training.  But these government voices are not following their own advice!  

To our friends in government – stop making excuses!  Follow your own advice.  Stop relying on just talk.  Share the real world examples.  Do what we do when we share examples.  We know how to give just enough facts that people can learn, but without invading anyone’s privacy.  You can teach us from actual cases, but still protect whatever and whoever you want to protect. 

Those of us who try to convince clients to up their games and make compliance programs actually effective need all the help and support we can get.  We need real world examples.  We need actual cases.  They get enormous attention.  But one case in two or three decades in one area of the law is way below what we need. 

Ladies and gentlemen in the enforcement communities around the world:  if compliance programs really matter, where are the cases?  

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