Sex, Gambling and… Ice Cream?

credit Got Defense Attorney
credit Got Defense Attorney

People working for Department of Defense, both employees and contractors, have been found to be issuing Department issued credit cards to pay for gambling and “adult entertainment.” The Department spokesperson was quick to point out that that doesn’t mean the Department paid for the activity. The way things work there is that the cards are not directly billed to the Department, instead to the individual and then the individual fills out a form requesting a reimbursement from the Department. This could mean that the employees wanted to hide the activities from their spouses. (From UPI and Politico.)

If that wasn’t salacious enough for your… hahaha… excuse me, I couldn’t help myself. Benjamin Netanyahu, the Israeli Prime Minister was audited by his nation’s Comptroller and found lavish spending. Among the usual types of lavish spending was $2,500 a month on ice cream. That’s right. Ice cream. People have already begun to make fun of this in ways that are hilarious, even if you don’t understand Hebrew.

credit Calcalist
credit Calcalist
credit Israelly Cool
credit Israelly Cool
credit International Business Times
credit International Business Times
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China’s New Corporate PR Problem

Corruption in the People’s Republic of China is nothing new to Western media consumers. The usual story is some corrupt politician in one of the ministries or provincial government who has been giving favorable contracts to friends and family for kickbacks. But in the past couple of years, a rise in a new type of corruption has been coming to light: corporate corruption.

https://chinadailymail.files.wordpress.com/2015/02/20-china-corruption.jpg
from China Daily Mail

Major Chinese corporations are generally state-owned and state-controlled. This makes these corporations arms of the government, even though they are participating in the private sector like other private sector firms. So, when corporate corruption takes place, the Chinese government is on the hook for them.

Chinese state-owned enterprises, especially China Construction Corporation (CCC), have been bidding for construction contracts in South Asian, Middle East and Africa against, primarily, South Korea. With the financial backing of the Chinese government, these firms have been winning the contracts for building infrastructure in Africa and private real estate projects elsewhere. Though these firms are working outside of China, their practices haven’t changed. Client-governments have been receiving bills that are twice as expensive as comparable projects, environmental studies and other feasibility studies have not been performed, and local officials have been getting offers to look the other way on these activities.

In a bold move, the Chinese government has primarily taken to defending CCC, asking client-governments to respect the contracts and pay up. Local governments find it hard to swallow such counter-accusations when China won’t produce evidence of work being done properly or at all. The Chinese government has a difficult time with diplomacy under such circumstances because they are considered intimately involved in these firms.

Corruption for Chinese firms like CCC puts Chinese government in a bind because it has been trying to crackdown on corruption in the government and cleanup its image. In the technology sector, firms like Xiomi has been able to prove to the world very quickly that it can compete fairly by producing better phones. If other sectors in China are to attempt to work across its borders, it’ll have to learn to compete with rules it can’t break.


About the Author: Marcus Maltempo is a compliance professional with more than a decade of experience helping banks, law firms and clients manage investigations and regulatory responses.


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GRC Means Governance, Risk & Compliance

GRC is an abbreviation for Governance, Risk and Compliance. These three functions are put together to increase efficiency and efficacy. Governance is responsible for overseeing the implementation of decisions made by the board of directors. Risk is responsible for analyzing all risks that impact revenue and operations. Compliance is responsible for meeting regulatory requirements to reduce, primarily, legal exposure. So, protect the integrity of management decisions, protect the business that makes the organization successful, and protect the organization from unnecessarily dealings with governments.

Going Through TSA
Going Through TSA

Depending on the industry, an organization maybe have licensed attorneys as heads of each of these areas. Other times, a separate legal department is created not just to deal with litigation issues but advising the organization on any combination of these three issues, there by allowing the organization to have functional and industry experts lead these areas. Governance can be lead by MIS or Audit professional – MIS means Management Information Systems. Risk can be lead by IT or operations professional – IT means Information Technology. Compliance can be led by Audit or front-office professional.

Front-office is a term used for the area of an organization that focuses on revenue and sales. Bankers in a bank are front-office professionals.

All three areas require a combinations of special knowledge.
Governance covers management issues, an understanding of operations, concerns of investors and shareholders and information being shared within the organization, both how and what. This person must have a strong understanding of the organization’s structure.

Risk covers capital requirements (if a bank), supply chain, losses from inefficiencies in the operations and the like. This person must have a strong understanding of how the business operates.

Compliance covers regulatory exams and responses, investigation, surveillance, monitoring, controls and policies and procedures, and sanctions (if a bank). This person must have a strong understanding of expectations by regulators as well as be a person who can persuade line-of-business professionals to buy-in to a set of rules for the whole organization to play by.


About the Author: Marcus Maltempo is a compliance professional with more than a decade of experience helping banks, law firms and clients manage investigations and regulatory responses.