6 ways forensic accountants fight financial threats

Forensic accountants are experts with a unique set of training and skills. “Forensic” means suitable for use in court, and forensic accounting is a speciality practice area of accounting that deals with engagements and investigations where disputes or litigation are anticipated.

For those reasons, the training and expertise demonstrated by these professionals make them very effective in investigating and combating fraud and other financial threats. That’s why CRI Group provides forensic accounting services to help clients safeguard their financial investments and utilise best practices when a case progresses to legal action – which is happening on a regular basis as more companies make rooting out fraud a top priority.

“Forensic accountants inhabit a cloak and dagger corner of the accounting world. Their job: respond at a moment’s notice when a client spots trouble – anything from procurement fraud to a top executive cooking the books to industrial espionage.”– Justin Pope, Associated Press

Here are some ways that forensic accountants lead the fight against fraud (Source: Forensic CPA Society, titled “What is a Forensic Accountant?”).

1. Forensic accountants are suspicious

They must be able to apply their accounting knowledge to legal issues. A forensic CPA will be asked to write expert reports, assist in depositions, testify as an expert witness, conduct fraud investigations and assist in civil and criminal investigations.

2. Forensic accountants are trained investigators

They are experts at determining whether criminal matters such as employee theft, securities fraud (including falsification of financial statements), identity theft, or insurance fraud have occurred. Investigation may also occur in civil matters.

3. Forensic accountants can testify in court

Forensic accountants often have to give expert evidence at the eventual trial. Forensic accountants not only utilise their accounting and auditing skills, but also use their investigative skills to determine what events actually took place in a financial setting. Knowledge of the courtroom sets the forensic accountant apart from a typical accountant.

4. Forensic accountants provide litigation support

Litigation represents the factual presentation of economic issues related to existing or pending litigation. In this capacity, the forensic accountant quantifies damages sustained by parties involved in legal disputes and can assist in resolving disputes before they reach the courtroom.

5. Forensic accountants can assist with business valuation

Forensic accountants often assist in professional negligence claims where they are assessing and commenting on the work of other professionals.

6. Forensic accountants can help recover assets

In the aftermath, forensic accountants may be involved in recovering proceeds of crime and in relation to confiscation proceedings concerning actual or assumed proceeds of crime or money laundering.

When financial pressure leads to fraud, you need a qualified forensic accountant – or better yet, a team of them – to unravel the numbers and the facts of the case. CRI Group’s highly qualified forensic accounting experts, which include our Certified Fraud Examiners (CFEs), can quickly find discrepancies in your finances and investigate the source of the problem.

The future of your business depends on safeguarding assets and investments from fraud. Contact CRI Group today and ask us how we can help your business by preventing and detecting fraud — thereby improving your bottom line.

Who is CRI Group?

Based in London, CRI Group works with companies across the Americas, Europe, Africa, Middle East and Asia-Pacific as a one-stop international Risk Management, Employee Background Screening, Business Intelligence, Due Diligence, Compliance Solutions and other professional Investigative Research solutions provider. We have the largest proprietary network of background-screening analysts and investigators across the Middle East and Asia. Our global presence ensures that no matter how international your operations are we have the network needed to provide you with all you need, wherever you happen to be. CRI Group also holds BS 102000:2013 and BS 7858:2012 Certifications, is an HRO certified provider and partner with Oracle.

In 2016, CRI Group launched Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management Systems, ISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification. ABAC® operates through its global network of certified ethics and compliance professionals, qualified auditors and other certified professionals. As a result, CRI Group’s global team of certified fraud examiners work as a discreet white-labelled supplier to some of the world’s largest organisations. Contact ABAC® for more on ISO Certification and training.

Filed under: Background Investigation, Investigative Solution, Resources by admin
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South Asia Grapples with anti-bribery compliance, ISO 37001 provides solutions

On the whole, South Asia has a troubled record when it comes to preventing bribery and corruption, and enforcing compliance. Recent cases and statistics show that the problem persists in most countries in the region. Both government officials and private sector business leaders are struggling to adopt policies, control methods and best practices to help reduce bribery and corruption on their watch.

High profile cases such as the IMDB scandal in Malaysia and, more recently, the alleged Meikarta township case in Indonesia underscore this point. The investigations that were triggered by these cases demonstrate, however, that regulators are serious about addressing the threat of bribery and corruption as more than just a legal issue, but as a societal one, as well. In response, organisations that are committed to being in compliance are adopting the ISO 37001 – Anti-Bribery Management Systems standard as a comprehensive approach to mitigating risk. ISO 37001 and its elements can be tailored to any type of organisation. It prescribes implementing an anti-bribery policy, appointing a person to oversee anti-bribery compliance, training, risk assessments and due diligence on projects and business associates. It also calls for implementing financial and commercial controls, and instituting reporting and investigation procedures.

Bribery Persists, With a Shifting Enforcement Landscape

While bribery and collusion appear to be decreasing slightly on a global scale, the unfortunate fact is that they remain steady in the South Asia (also referred to as the Asia Pacific) region. Other than New Zealand, Singapore, and Australia, who scored well in combating corruption, a majority of countries in the region are on the bottom half of the Transparency International Corruption Perceptions Index (CPI) spectrum. North Korea ranks the worst at No. 176. Cambodia ranks No. 161, Vietnam is 117, Thailand and the Philippines are tied at No. 99, and Sri Lanka and Indonesia are tied at 89, just to name a few. In an article presenting the latest rankings, Transparency International asserts that the region’s performance over the past three years indicates that “the Asia Pacific region is making little progress in the fight against corruption.” The report further states: “Why is Asia Pacific making little to no progress in its anti-corruption efforts? One of the reasons is an overall weakening of democratic institutions and political rights.”

This reputation for poor performance on the global stage of anti-corruption measures has spurred government initiatives in several jurisdictions to make new headway in efforts to combat bribery and corruption. Awareness of bribery and corruption is peaking and government leaders, by and large, do not want the perception of being on the wrong side of progress on this issue: “Corruption is one of the main obstacles to sustainable economic, political and social development, for developing, emerging and developed economies alike. Overall, corruption reduces efficiency and increases inequality. Estimates show that the cost of corruption equals more than 5% of the gross world product, which means estimated fraud losses of £3.65 trillion for 2019 – with over £829 million paid in bribes each year (World Bank). It is not only a question of ethics; we simply cannot afford such waste”.

Southeast Asia is seeing countries boost their efforts. This is evident to varying degrees in Vietnam, the Philippines, Cambodia, Indonesia and others – though, as the Transparency International report shows, there is much work to be done. Farther East, South Korea experienced recent high profile corruption scandals, which led to massive public protests and the swift impeachment and prosecution of its President, Park Geun-hye”. Three years ago, South Korea passed the sweeping Improper Solicitations and Graft Prohibition Act, better known as the “Kim Young Ran Law” after the former Supreme Court justice who proposed the Act.[/vc_column_text][vc_row_inner][vc_column_inner]

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Newest Developments: “Shenzhen of Indonesia” Case

One of the latest high-profile bribery cases in the region involves the chairman of Indonesian-based Lippo Group and other figures involved in a major development build called Meikarta township. The project has been touted as the “Shenzhen of Indonesia.” After months of investigation, Lippo Group deputy chairman James Riady appeared as a witness in court in February and denied allegations that he was involved in corruption involving permits for the project. The Corruption Eradication Commission (KPK) Indonesia had already arrested Lippo Group operational director Billy Sindoro, along with Bekasi Regent Neneng Hasanah Yasin and several other top officials in the administration “for their alleged roles in bribery connected to the issuance of property permits for the project.” The allegations involve a promise of Rp 13 billion (US$856,888) in bribes to the Bekasi regency administration for issuing the relevant permits, of which Rp 7 billion had reportedly been transferred. The case is not yet fully resolved as of this writing.

The Meikarta case isn’t the only alleged corruption scandal plaguing Indonesia. The head of a state power utility and a senior politician were implicated in a bribery scandal involving the awarding of a major public works contract. KPK officials suspect that Perusahaan Listrik Negara (PLN) President Sofyan Basir agreed to award a contract to build a 600 megawatt coal-fired power plant in exchange for a kickback of Rp 4.75 billion ($332,800). And, in yet another recent bribery case, the KPK arrested the head of the United Development Party, or PPP.

Perhaps the defining bribery case for the region in recent years is the 1MDB case in Malaysia. Malaysia’s state-owned investment fund, 1MDB, was supposed to attract foreign investment. Instead, it “spurred criminal and regulatory investigations around the world that have cast an unflattering spotlight on financial deal-making, election spending and political patronage under former Prime Minister Najib Razak. The figures are mind-boggling: a Malaysian parliamentary committee identified at least $4.2 billion in irregular transactions related to 1MDB. In May, Najib was ousted from power in a general election as the scandal fueled a voter backlash that ended his party’s 61 years of rule. As the investigations continue, Najib faces trial on corruption charges and U.S. prosecutors have implicated at least three senior Goldman Sachs Group Inc. bankers in a multiyear criminal enterprise”.

The 1MDB case has implications that spread far beyond Malaysia and the South Asia region. In the U.S., federal prosecutors announced that one of the implicated former Goldman Sachs bankers had pleaded guilty, with bribery and money laundering charges lodged against a second banker as part of the investigation. U.S. prosecutors “also brought charges against the Malaysian businessman they believe stole some of the money: Jho Low, who spent millions of dollars on gifts to celebrities like the actor Leonardo DiCaprio and the model Miranda Kerr. The money was used to buy a Picasso painting, diamond necklaces and Birkin bags as well as to pay for the Hollywood blockbuster ‘The Wolf of Wall Street.’”.

Cases like the 1MDB scandal demonstrate that investigation and enforcement are stepping up. The Foreign Corrupt Practices Act (FCPA), UK Bribery Act 2010 and other laws on the books provide tools for regulators to bring action against companies doing business overseas, and even those principal actors in foreign organisations if they run afoul of anti-corruption laws. In Malaysia, the Malaysian Anti-Corruption Commission (Amendment) Act 2018 added a provision on corporate liability. The amended act (formerly the Malaysian Anti-Corruption Commission [MACC] Act 2009) gives more power to the MACC in fighting corruption in the private sector, as it includes penalties for firms that can now be held liable if their employees commit bribery.

Speaking in Kuala Lumpur, Malaysia, at the Anti-Bribery Anti-Corruption (ABAC) Summit 2018, Mohd Nur Lokman bin Samingan, Assistant Commissioner at Malaysian Anti-Corruption Commission, explained some of the key objectives of the 2018 Amendment Act. Among them, the new provisions are meant “to encourage business and commercial activities being carried out in a corruption-free environment; to encourage all commercial organisations to take adequate measures in order to prevent corruption in their respective organisations; and to promote better corporate governance and legal compliance by requiring corporations to take proactive roles in preventing corruption”. Mr. Mohd Nur Lokman went on to explain that punishment for bribery and other corrupt acts under the amendment can include fines “of not less than 10 times the sum of value of the gratification which is the subject matter of the offence”, or one million ringgit (whichever is higher) – and can also include imprisonment for a term not exceeding 20 years.[/vc_column_text]

ISO 37001:2016 to Tackle Bribery

At this year’s (2019) Malaysian Anti-Corruption Commission (MACC) Seminar Benchmark on Governance, Integrity & Anti-Corruption, leaders and luminaries in anti-bribery and anti-corruption gathered to speak on compliance issues affecting the region. The event was held in conjunction with the British High Commission (BHC). The seminar provided examination and discussion of UK’s best practices in governance, integrity and anti-corruption, including a focus on the ISO 37001 Anti-Bribery Management System Standard.

Keynote speaker Zafar Anjum, founder and CEO of CRI® Group and ABAC® Center of Excellence, presented “Anti-Bribery Management System (ABMS 37001) Case Study and Implementation – UK Experience”. Anjum provided an overview on ISO 37001 ABMS Accreditation & Certification as an effective and “adequate procedure” for organisations in the region and beyond. First, Anjum provided some stark statistics. He said that according to the International Monetary Fund, “An estimated $2 trillion in bribes is paid annually in both developing and developed countries”. Anjum also noted that the Association of Certified Fraud Examiners (ACFE) 2018 Report to the Nations – Global Study on Occupational Fraud and Abuse found that “Organizations lose an average of 5% of their annual revenue to fraud each year”.

To combat the threat, organisations around the world are turning to ISO 37001. The International Organization for Standardization (ISO) issued ISO 37001 in 2016 to help organisations worldwide increase and measure their efforts against bribery and corruption. Anjum explained that ISO 37001 ABMS implements standards in organisations at every level through measures that include adopting an anti-bribery policy, appointing a person to oversee anti-bribery compliance, training, risk assessments and due diligence on projects and business associates. It also involves implementing financial and commercial controls and instituting reporting and investigation procedures. Anjum described the work of the ABAC® (Anti-Bribery and Anti-Corruption) Center of Excellence, a global network of certified ethics and compliance professionals, qualified auditors, financial and corporate investigators, certified fraud examiners, forensic analysts and accountants, as a tool for organisations to prevent bribery and corruption. ABAC Certification is an accredited provider of ISO 37001 ABMS Certification and Training for organisations of all types and industries.

The ISO 37001 standard specifies requirements and provides guidance for establishing, implementing, maintaining, reviewing and improving an anti-bribery management system. The system can be stand-alone or can be integrated into an overall management system. ISO 37001 addresses the following in relation to the organisation’s activities:

• Bribery in the public, private and not-for-profit sectors
• Bribery by the organisation
• Bribery by the organisation’s personnel acting on the organisation’s behalf or for its benefit
• Bribery by the organisation’s business associates acting on the organisation’s behalf or for its benefit
• Bribery of the organisation
• Bribery of the organisation’s personnel in relation to the organisation’s activities
• Bribery of the organisation’s business associates in relation to the organisation’s activities
• Direct and indirect bribery (e.g. a bribe offered or accepted through or by a third party)

The ISO 37001 process helps companies and government organisations reduce the risk of bribery by establishing, implementing, maintaining and enhancing internal anti-bribery and anti-corruption systems. When administered by an accredited provider of ISO ABMS certification and training, the protocol can:

• Provide needed tools to prevent bribery and mitigate related risks
• Help an organisation create new and better business partnerships with entities that recognizse ISO 37001 certified status, including supply chain manufacturing, joint ventures, pending acquisitions and co-marketing alliances
• Potentially reduce corporate insurance premiums
• Provide customers, stakeholders, employees and partners with confidence in the entity’s business operations and ethics
• Provide a competitive edge over non-certified organizations the organisation’s industry or niche
• Provide acceptable evidence to prosecutors or courts that the organization has taken reasonable steps to prevent bribery and corruption

As the ISO documentation states, “Conformity with (ISO 37001) cannot provide assurance that no bribery has occurred or will occur in relation to the organisation, as it is not possible to completely eliminate the risk of bribery”. ISO ABMS certification is, however, a potential mitigating piece of evidence to regulators or even prosecutors and the courts that the entity has taken meaningful steps in its efforts to prevent bribery and corruption.

Conclusion

Which organisations need ISO 37001? Despite the slow progress in combating bribery and corruption, the South Asia region remains an attractive market for organisations looking to expand. New laws and enforcement efforts are providing an increasing emphasis on compliance. In such a climate, organisations must stand ready to demonstrate their implementation of internal processes, policies and controls to prevent and detect bribery and corruption and remain in compliance.

The ISO 37001 ABMS standard is an established, tried and tested program that addresses those issues head-on through a comprehensive program of training and certification. The training process is tailored to the organisation, while still following the developed curriculum and documented best practices. Certification requires the demonstration that processes have been implemented effectively, with follow-up evaluations. Developments in the South Asia region and worldwide have demonstrated that there isn’t time to wait to implement controls and compliance procedures – the next investigation and/or prosecution may be too late. The harm caused by bribery and corruption to an entity’s reputation, investments and business can be far-reaching and long-lasting.[/vc_column_text][/vc_column][/vc_row][vc_section][vc_row_inner][vc_column_inner][accordion_father activetabbg=”#4c4c4c”][accordion_son title=”About CRI® Group” clr=”#ffffff” bgclr=”#bfbfbf”]Based in London, CRI Group works with companies across the Americas, Europe, Africa, Middle East and Asia-Pacific as a one-stop international Risk Management, Employee Background Screening, Business Intelligence, Due Diligence, Compliance Solutions and other professional Investigative Research solutions provider. We have the largest proprietary network of background-screening analysts and investigators across the Middle East and Asia. Our global presence ensures that no matter how international your operations are we have the network needed to provide you with all you need, wherever you happen to be. CRI Group also holds BS 102000:2013 and BS 7858:2012 Certifications, is an HRO certified provider and partner with Oracle.

In 2016, CRI® Group launched Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management Systems, ISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification. ABAC® operates through its global network of certified ethics and compliance professionals, qualified auditors and other certified professionals. As a result, CRI Group’s global team of certified fraud examiners work as a discreet white-labelled supplier to some of the world’s largest organisations. Contact ABAC® for more on ISO Certification and training.[/accordion_son][accordion_son title=”About the Author” clr=”#ffffff” bgclr=”#bfbfbf”]By Zafar Anjum MSc, CFE, Intl. Dip. (Fin. Crime)

Group Chief Executive, CRI Group[/accordion_son][accordion_son title=”Sources & Credits” clr=”#ffffff” bgclr=”#bfbfbf”]

1. Danielle Keeton-Olsen, “Why Foreign Businesses Will Put Up With Some Corrupt Practices In Southeast Asia”, Forbes, < https://www.forbes.com/sites/daniellekeetonolsen/2018/01/12/why-foreign-businesses-will-put-up-with-some-corrupt-practices-in-southeast-asia/#673e13902fe3> (accessed 2 Nov. 2018).
2. “Corruption Perceptions Index 2018”, Transparency International, 2019, < https://www.transparency.org/cpi2018> (accessed 5 Aug. 2019)
3. “Asia Pacific: Little To No Progress On Anti-Corruption”, Transparency International, 29 Jan. 2019, <https://www.transparency.org/news/feature/asia_pacific_makes_little_to_no_progress_on_anti_corruption> (accessed 5 Aug. 2019)
4. OECD, The rationale for fighting corruption. 2014 <http://www.oecd.org/cleangovbiz/49693613.pdf> (accessed 2 Nov. 2018)
5. Vanessa Romo, “Former Interpol President Pleads Guilty To Bribery In Chinese Court,” NPR, 20 June 2019, <https://www.npr.org/2019/06/20/734397465/former-interpol-president-pleads-guilty-to-bribery-in-chinese-court> (accessed 5 Aug. 2019)
6. Alejandro Salas, Asia and the Pacific’s corruption scorecard: Fighting corruption needs long-term political commitment in the region, Policy Forum, 2018, <https://www.policyforum.net/asia-and-the-pacifics-corruption-scorecard/> (accessed 2 Nov. 2018).
7. “A year on, anti-corruption law changes South Korea’s graft-prone culture,” Straits Times, 2017, <https://www.straitstimes.com/asia/east-asia/a-year-on-anti-corruption-law-changes-south-koreas-graft-prone-culture (accessed 2 Nov. 2018).
8. Harry Suhartono and David Yong, “Bribery Probe Hurts One of Southeast Asia’s Biggest Projects”, Bloomberg, 18 Oct. 2018, <https://www.bloomberg.com/news/articles/2018-10-17/arrests-leave-one-of-southeast-asia-s-biggest-projects-in-limbo> (accessed 4 Aug. 2019)
9. Arya Dipa, “‘It wasn’t my idea’: Lippo Group’s James Riady denies involvement in Meikarta case”, The Jakarta Post, 9 Feb. 2019, < https://www.thejakartapost.com/news/2019/02/09/it-wasnt-my-idea-lippo-groups-james-riady-denies-involvement-in-meikarta-case.html> (accessed 4 Aug. 2019)
10.  Erwida Maulia, ‘Indonesia bribery cases weigh on Jokowi’s reform plans”, Nikkei Asian Review, 2 May 2019, < https://asia.nikkei.com/Politics/Indonesia-bribery-cases-weigh-on-Jokowi-s-reform-plans> (accessed 4 Aug 2019)
11. Shamim Adam , Laurence Arnold , and Yudith Ho, “The Story of Malaysia’s 1MDB, the Scandal That Shook the World of Finance,” Bloomberg, 2018, <https://www.bloomberg.com/news/articles/2018-05-24/how-malaysia-s-1mdb-scandal-shook-the-financial-world-quicktake> (accessed 3 Nov. 2018)
12. Matthew Goldstein, Alexandra Stevenson and Emily Flitter, “Goldman Sachs Ensnarled in Vast 1MDB Fraud Scandal,” The New York Times, 2018, <https://www.nytimes.com/2018/11/01/business/goldman-sachs-malaysia-investment-fund.html> (accessed 3 Nov. 2018)
13. Bernama, “Revised MACC Act 2009 to come into force in 2018,” The Straits Times, 2018. < https://10times.com/abac-malaysia> (accessed 11 Nov. 2018).
14. Mohd Nur Lokman bin Samingan, “Offence by Commercial Organisation”, ABAC Summit 2018, Kuala Lumpur, Malaysia, 25 Sept. 2018.
15. Zafar Anjum, “Anti-Bribery Management System (ABMS 37001) Case Study and Implementation – UK Experience”, MACC Seminar Benchmark on Governance, Integrity & Anti-Corruption, Putrajaya, Malaysia, July 2019.

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Filed under: Anti-Bribery Anti-Corruption Solution, Compliance Solution, ISO 37001, Resources by admin
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Top 10 ways to protect your organisation from bribery and corruption

According to the International Monetary Fund (IMF) public sector corruption siphons $1.5 trillion to $2 trillion annually from the global economy in bribes and costs far more in stunted economic growth, lost tax revenues and sustained poverty. The fact is, bribery and corruption can affect any organization, of any size, in any industry and location. So how to protect your organization from bribery and corruption.

There are 10 things that an organization can do, to be better protected against the threat of bribery and corruption:

1. Be proactive: Adopt a code of ethics for management and employees. Evaluate your internal controls for effectiveness and identify areas of the business that are vulnerable to bribery and corruption.
2. Be strict: Communicate regularly to staff about anti-bribery and corruption policies, ways to report suspicions of misconduct, and the potential consequences (including termination and prosecution) of unethical behavior.
3. Train your employees: Your workforce is your first line of defense against corruption – enroll your organization in training programs like ISO 37001:2016 Anti-Bribery Management System Introductory, Internal Auditor or Lead Auditor training to ensure they can properly identify, prevent and detect bribery.
4. Be aware of red flags: Payment for vague services like “facilitating”, paying higher-than-normal fees to a vendor as “commission”, off-the-books deals, requirements of cash-only payments or unusual payment arrangements are all signs that things may be amiss and require further review.
5. Validate compliance regularly: Putting standards in place is only effective if you test and follow them year-round. Implement a process to ensure compliance with legislation like the Foreign Corrupt Practices Act (FCPA) and UK Bribery Act 2010.
6. Conduct due diligence: An unethical partner or supplier engaging in bribery and corruption can have serious effects on your own company’s reputation. Conduct thorough due diligence, with background checks and full risk assessments, on all third-parties with which you are engaged.
7. Encourage whistleblowing. Corruption is still most likely to be detected by a tip. Providing an anonymous reporting system for your employees, contractors and clients will help uncover more cases of bribery and other misconduct.
8. Be transparent: A way to be proactive in your engagement with others is to ask for feedback. Then be prepared to address it, good or bad – creating open lines of communication and honest dialogue regarding what is and what isn’t unethical behavior.
9. Establish Hiring Procedures: When hiring staff, conduct thorough background investigations. Check educational, credit and employment history (as permitted by law), as well as references.
10. Get Certified: The ISO 37001:2016 Anti-Bribery Management System standard is designed to help an organization implement an anti-bribery management system. Any organization can and should become ISO 37001 certified to signify the measures it has taken to prevent and detect bribery and corruption

About us…

Based in London, CRI® Group works with companies across the Americas, Europe, Africa, Middle East and Asia-Pacific as a one-stop international Risk Management, Employee Background Screening, Business Intelligence, Due Diligence, Compliance Solutions and other professional Investigative Research solutions provider. We have the largest proprietary network of background screening analysts and investigators across the Middle East and Asia. Our global presence ensures that no matter how international your operations are, we have the network needed to provide you with all you need, wherever you happen to be. CRI® Group also holds BS102000:2013 and BS7858:2019 Certifications is an HRO certified provider and partner with Oracle.

In 2016, CRI® Group launched the Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management Systems, ISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification. ABAC® operates through its global network of certified ethics and compliance professionals, qualified auditors and other certified professionals. As a result, CRI® Group’s global team of certified fraud examiners work as a discreet white-labelled supplier to some of the world’s largest organizations. Contact ABAC® for more on ISO Certification and training.

MEET THE CEO

Zafar I. Anjum is Group Chief Executive Officer of CRI® Group (www.crigroup.com), a global supplier of investigative, forensic accounting, business due to diligence and employee background screening services for some of the world’s leading business organizations. Headquartered in London (with a significant presence throughout the region) and licensed by the Dubai International Financial Centre-DIFC, the Qatar Financial Center – QFC, and the Abu Dhabi Global Market-ADGM, CRI® Group safeguard businesses by establishing the legal compliance, financial viability, and integrity levels of outside partners, suppliers and customers seeking to affiliate with your business. CRI® Group maintains offices in UAE, Pakistan, Qatar, Singapore, Malaysia, Brazil, China, the USA, and the United Kingdom.

Contact CRI® Group to learn more about its 3PRM-Certified™ third-party risk management strategy program and discover an effective and proactive approach to mitigating the risks associated with corruption, bribery, financial crimes and other dangerous risks posed by third-party partnerships.

CONTACT INFORMATION

Zafar Anjum, MSc, MS, CFE, CII, MICA, Int. Dip. (Fin. Crime) | CRI® Group Chief Executive Officer

37th Floor, 1 Canada Square, Canary Wharf, London, E14 5AA United Kingdom

t: +44 207 8681415 | m: +44 7588 454959 | e: zanjum@crigroup.com

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Decrease Bribery Risk with ISO 37001:2016 ABMS

Bribery and corruption are worldwide problems with serious consequences for organisations of any size, industry or region. To help combat this threat, the International Organization for Standardization (ISO) issued the ISO 37001:2016 Anti-Bribery Management System (ABMS) standard. This standard helps businesses, nonprofits and governmental agencies to reduce their risk of bribery and corruption, How? By establishing, implementing, maintaining and improving an anti-bribery management system.

> Does your organisation have an ethical code of conduct? Don’t make assumptions that your employees know to conduct themselves in an ethical manner. Read “Your organisation needs an ethical code of conduct” to learn more.

The ISO 37001:2016 standard mirrors numerous steps contained in the U.S. Foreign Corrupt Practices Act, the UK Bribery Act 2010 and other major legislation aimed to curb bribery and corruption and increase punishments resulting from its occurrence. When an organisation makes the decision to move forward with ISO 37001:2016 ABMS training and certification, the benefits are immediate. That’s because ISO 37001:2016 puts methods in place that do the following:

• Ensure that your organisation is implementing a viable anti-bribery management system using widely accepted controls and systems.
• Give your company the tools it needs to prevent bribery and mitigate related risks
• Provide assurance to management, investors, business associates, personnel and other stakeholders that the organisation is actively pursuing internationally recognised and accepted processes to prevent bribery and corruption.
• Help your company create new and better business partnerships with entities that recognise your certified status, including supply chain manufacturing, joint ventures, pending acquisitions and co-marketing alliances
• Potentially reduce corporate insurance premiums
• Provide your customers, stakeholders, employees and partners with confidence in your business operations and ethics
• Provide a competitive edge over non-certified organisations in your industry or niche
• Provide acceptable evidence to prosecutors or courts that the organisation has taken reasonable steps to prevent bribery and corruption

ISO 37001:2016 certifies that your organisation has implemented reasonable and proportionate measures to prevent bribery. These measures involve top-level leadership, training, bribery risk assessment, due diligence adequacy, financial and commercial controls, reporting, audit and investigation.

Impacting your corporate culture

An organisation that takes a firm stand against bribery and corruption, and makes compliance standards a priority, will see the effects among its employees and in its corporate culture. After all, ISO 37001:2016 isn’t just for the security team or executives. It involves the entire organisation. Staff learn how to recognise red flags of noncompliance for bribery and fraud, and how to report them. They also gain an understanding that the organisation won’t tolerate unethical behaviour, especially when it comes to bribery and corruption. For example, many employees in today’s workforce might think they understand what bribery and corruption are – but they probably don’t recognise the many different ways it can manifest itself in the business world. ABAC® Certified™ training and certification process for ISO 37001:2016 educates your personnel and helps your company address bribery in all its forms, including:

• In the public, private and not-for-profit sectors
• By the organisation
• By the organisation’s personnel acting on the organisation’s behalf or for its benefit
• By the organisation’s business associates acting on the organisation’s behalf or for its benefit
• Of the organisation
• Of the organisation’s personnel in relation to the organisation’s activities
• Of the organisation’s business associates in relation to the organisation’s activities
• Direct and indirect bribery (e.g. a bribe offered or accepted through or by a third party) (Source: ISO 37001 ABMS Standard)

> Enhance your organisation’s anti-corruption culture! Read our FREE “Whitepaper: Countering bribery & corruption in the public & private sectors – Anti-corruption culture, risk assessment, auditing & compliance”

Expert training from an accredited body

CRI Group’s ABAC® Certification services are accredited by the Emirates International Accreditation Center (EIAC) for administering the ISO 37001:2016 anti-bribery standard, and has leading experts administering the 37001:2016 Anti-Bribery Management Systems certification program. ISO 37001:2016 Anti-Bribery Management System Certification reflects international best practices and can be used in all jurisdictions. It is applicable to small, medium and large organizations in all sectors, including public, private and not-for-profit sectors. reduce the risk of bribery and corruption by establishing, implementing, maintaining and improving your management system. When everyone is on the same page and playing as a team, the organisation is stronger because employees trust one another to do the right thing. Those “gray areas” of rule-bending and non-compliance are no longer gray. The organisation culture dictates that only ethical behaviour and compliance with anti-bribery and anti-fraud standards will be acceptable.

When an organisation undertakes ISO 37001:2016 training, employees understand that ethical behaviour is the norm, and anything outside of those bounds will be punished – especially criminal acts like bribery and corruption – perhaps with the loss of their job, or even prosecution. ABAC® Certification provides three levels of training ensure that employees get the instruction they need: Introductory Training, Internal Auditor Training, and Lead Auditor Training. ABAC® conducts ISO 37001:2016 training in a classroom setting, providing face-to-face interaction with expert instructors. The training helps establish an ethical culture by educating your employees on the following:

• What constitutes fraud, corruption, and bribery, and why these are so damaging to business
• How to identify red flags of fraud, corruption and bribery
• The process for reporting fraudulent and unethical acts
• The organisation’s zero-tolerance attitude toward unethical behaviour and willingness to terminate employees for breaches, and prosecute unethical acts
• The serious ramifications for committing fraud or bribery, the legal consequences, and the negative impact on one’s career

The time is now to take action against bribery and corruption – the world is watching, and organisations that make anti-bribery and anti-corruption and compliance a priority are poised to be successful. ISO 37001:2016 provides the layer of security, and as it is stated in the standard itself, “Conformity with this document cannot provide assurance that no bribery has occurred or will occur in relation to the organisation, as it is not possible to completely eliminate the risk of bribery. However, this document can help the organisation implement reasonable and proportionate measures designed to prevent, detect and respond to bribery”. The benefits are long-lasting and far reaching. Most importantly, when you engage ABAC® ’s training and certification program, you are assured that an accredited team of experts is working with your organisation to implement a top-of-the-line program that is tailored to your needs and accomplishes your goals.

> Need a reason for ISO 37001 certification? How about 25 of them? Check out our ABAC® “25 Benefits of ISO 37001 ABMS Certification” article now!

Whether your organisation is a corporation, nonprofit, or government agency, you can start enjoying the benefits of ABAC® Certification’s ISO 37001:2016 training and certification immediately. Learn more about ABAC®  Certification and ISO 37001:2016 Anti-Bribery Management System today. 

Who is CRI Group?

Based in London, CRI Group works with companies across the Americas, Europe, Africa, Middle East and Asia-Pacific as a one-stop international Risk Management, Employee Background Screening, Business Intelligence, Due Diligence, Compliance Solutions and other professional Investigative Research solutions provider. We have the largest proprietary network of background-screening analysts and investigators across the Middle East and Asia. Our global presence ensures that no matter how international your operations are we have the network needed to provide you with all you need, wherever you happen to be. CRI Group also holds BS 102000:2013 and BS 7858:2012 Certifications, is an HRO certified provider and partner with Oracle.

In 2016, CRI Group launched Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management Systems, ISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification. ABAC® operates through its global network of certified ethics and compliance professionals, qualified auditors and other certified professionals. As a result, CRI Group’s global team of certified fraud examiners work as a discreet white-labelled supplier to some of the world’s largest organisations. Contact ABAC® for more on ISO Certification and training.

Prove That Your Business is Ethical for FREE

Complete our FREE Highest Ethical Business Assessment (HEBA) & evaluate your current Corporate Compliance Program. Find out if your organisation’s compliance program is in the line with worldwide Compliance, Business Ethics, Anti-Bribery and Anti-Corruption Frameworks. Let ABAC® experts prepare a complimentary gap analysis of your compliance program to evaluate if it meets “adequate procedures” requirements under UK Bribery Act, DOJ’s Evaluation of Corporate Compliance Programs Guidance and Malaysian Anti-Corruption Commission.

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Corruption: a real Threat to Organisations Worldwide

Corruption: a Real Threat to Organisations Worldwide

For ages, systematic bribery was tolerated in various countries and industries as a “necessary part of getting business done or circumventing bureaucratic red tape.” The times are changing, however. Societies and their governments have recognised that bribery and corruption vastly affect economic growth, undermine trust and discourage investment. Studies show that bribery and corruption directly contribute to global poverty, social inequality, and a decrease in public infrastructure development.

To help organisations worldwide increase and measure their efforts against bribery and corruption, the International Organization for Standardization (ISO) issued the ISO 37001:2016 Anti-Bribery Management System standard. This new standard mirrors numerous steps contained in the U.S. Foreign Corrupt Practices Act, the U.K. Bribery Act 2010 and other major legislation aimed to curb bribery and corruption and increase punishments resulting from its occurrence.

The standard is a set of controls that any organisation can implement with the right guidance. The first step is an understanding among business leaders, from ownership and directors to management, that a global corruption problem exists – and ignoring it will eventually lead to serious consequences. From lapses in corporate due diligence and devolving government and corporate integrity to poor transparency, lack of accountability, and inadequate corporate integrity systems, business corruption has become rampant and commonplace globally. According to Transparency International, bribery and corruption were among the key components that led to the recent global economic crisis.

ISO 37001:2016 for different types of organisations

When it comes to bribery and corruption, businesses, non-profits, and government organisations all face risks to their financial well-being and reputation. ISO 37001:2016 Anti-Bribery Management System standard plays a vital role for all types of organisations in reducing risk and putting a structure in place that prevents and detects bribery and corruption on all levels.

Corporate/private sector

In the present era of globalisation, anti-corruption compliance plays a vital role for companies with high ethical values trying to expand business across borders and attract potential investors and business partners for the long term. Such companies are expected to ensure the integrity of their operations and the conduct of their suppliers, distributors, and agents wherever they may be.

To meet these needs, the standard ISO 37001:2016 is designed to apply to all organisations (or parts of an organisation) regardless of type, size and nature of the business activity. The program is tailored to the needs and requirements of the organisation.

Public sector organisations

Public sector organisations play critical roles, often interacting directly with the public they serve; they include utility service providers, license-issuing authorities and other regulatory bodies. These are vulnerable areas where authority is concentrated with weak financial positions that must fulfil the needs of both the service provider and its users. Such public sector organisations can benefit from implementing ISO 37001:2016 to control bribery and corruption to enhance their productivity level and play an improved role in the socio-economic development of their country.

Government departments

The government is a major stakeholder in the socio-economic development of a country. Hence it makes laws, regulations and establishes departments to check and control bribery and corruption. In many developing countries, however, anti-corruption laws and regulations are either weak or implemented unevenly, providing poor results. Government-led steps or campaigns to fight corruption often are ineffective, while bribes continue to be accepted as part of doing business. However, the threat of bribery and corruption can be mitigated through the implementation of ISO 37001:2016 standard, which provides safeguards within a management system, rather than temporary measures or mere slogans.

Training is the key to prevention

According to the Association of Certified Fraud Examiners’ “Report to the Nations on Occupational Fraud and Abuse,” a company’s employees are its best protection against fraud. Statistics show that most fraud is detected by internal tips, even more than audits and other methods. That means that employees recognise fraud, understand that it’s wrong and not acceptable at their workplace, and report it.

This means that the more trained and educated a workforce is about fraud, bribery and corruption, the better that organisation will operate as a team in preventing and detecting those behaviours.

The ISO 37001:2016 Anti-Bribery Management System uses this approach as a focal point in providing the standards for training and knowledge your organisation needs to prevent fraud, bribery and corruption. The proper training program should be tailored to your organisation, based on its size, the way it’s structured, the business you conduct, and your specific risk areas identified in the discovery phase. In this way, ISO 37001:2016 accommodates every level of your organisation to ensure that the entire team gets the training needed to identify, prevent and detect bribery and corruption.

The ISO 37001:2016 Anti-Bribery Management System certification empowers you with the ability to safeguard and maintain the integrity of your company by:

• Guaranteeing that all workers and agents are devoted to the latest anti-bribery practice
• Regularly validating compliance to appropriate legislation like the FCPA and U.K. Bribery Act 2010
• Jointly cooperating with stakeholders to observe and reduce the risks throughout your supply chain
• Externally scrutinising your company, testing the effectiveness of your anti-bribery policies and processes
• Ensuring compliance in action

ISO 37001:2016 Anti-Bribery Management System certification is offered under CRI® Group’s ABAC® Center of Excellence, an independent certification body established for Anti-Bribery Management System, Compliance Management System and Risk Management System certification. ABAC Certification’s experts are skilled at developing and implementing programs to meet clients’ needs and requirements. Learn more about ABAC Certification and ISO 37001:2016 Anti-Bribery Management System today.

Who is CRI Group?

Based in London, CRI Group works with companies across the Americas, Europe, Africa, Middle East and Asia-Pacific as a one-stop international Risk Management, Employee Background Screening, Business Intelligence, Due Diligence, Compliance Solutions and other professional Investigative Research solutions provider. We have the largest proprietary network of background-screening analysts and investigators across the Middle East and Asia. Our global presence ensures that no matter how international your operations are, we have the network needed to provide you with all you need, wherever you happen to be. CRI Group also holds B.S. 102000:2013 and B.S. 7858:2012 Certifications, is an HRO certified provider and partner with Oracle.

In 2016, CRI Group launched the Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management Systems, ISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification. ABAC® operates through its global network of certified ethics and compliance professionals, qualified auditors and other certified professionals. As a result, CRI Group’s global team of certified fraud examiners work as a discreet white-labelled supplier to some of the world’s largest organisations. Contact ABAC® for more on ISO Certification and training.

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ISO 37001 Certification: a Proclamation of Business Integrity

It’s a well-known World Bank statistic, but one that bears continual repeating: More than US$1.5 trillion – or 2% of world gross domestic product – is paid in bribes each and every year, contributing to the demise of governments, inadequate social services, inferior infrastructure, low-quality goods and services, and a general strain on public and private sector integrity and reputation.

But the past several years have seen marked progress in the global fight against bribery and corruption, particularly with the adoption of ISO 37001 “Anti-Bribery Management Systems,” which provides generally accepted standards for establishing, implementing, maintaining, reviewing and improving an organisation’s anti-bribery management system.

The global adoption of the standard means that organisations worldwide can now publicly demonstrate their intent to battle bribery via review, examination and certification of their systems to the ISO standard. And in doing so, those certified organisations are realising many key benefits that come with certification, and the extended impact certification has on their supply chain and third-party partners.

ISO 37001 Certification: A Conscientious Decision

ISO 37001 certification is not currently mandated by governments around the world, with the exception of Malaysia and a few other countries which are considering certification as a requirement for private sector organisations bidding for government contracts. That said, multi-national organisations are increasingly seeking certification as a conscientious decision to improve their operations for the good of the overall organisation.

In doing so, those organisations are making a strong statement to their stakeholders, customers, authorities, third-parties and the international marketplace that they are taking all necessary measures to review, amend and improve their systems and processes to control and prevent bribery.

Even more important, to verify compliance and achieve such certification, those organisations are willing to expose their operations to outside independent auditors who are specifically trained in identifying risks and weaknesses within the organisation, while making recommendations for improvement.

From an integrity perspective, the result of certification to the ISO 37001 standard can help reduce internal and external corruption risks, manage compliance risks and boost the public perception and reputation of the organisation as a whole.

This can provide the organisation with certain advantages in the tender process and give the organisation a competitive edge in business development.

Take for example the case of Mubadala Investment Company PJSC (Mubadala), a state-owned holding company that can be characterised as a sovereign wealth fund in the United Arab Emirates, a country widely known for its relatively high rankings on the annual Transparency International Corruption Perception Index.

In 2019 Mubadala called on CRI Group’s ABAC Center of Excellence to attain ISO 37001 certification. Upon completion of the extremely thorough and careful certification process, Mubadala Head of Ethics & Compliance noted that achieving such certification has helped his organisation provide full confidence to its partners and shareholders, and has opened avenues of investment for international and national companies because Mubadala enjoys a great rapport with the business community as a competent and truthful entity.

“We are very proud to attain this certification. It demonstrates our strong commitment to the highest standards of ethics and integrity in our activities. This achievement specifically affirms the presence of anti-bribery management systems across Mubadala that support a culture of transparency and compliance in line with the highest global standards.” Mubadala Head of Ethics & Compliance said.

The Ripple Effect of ISO 37001 Certification

While one of the most beneficial advantage of certification is that it formally announces to the global marketplace that the organisation has gone to great lengths to demonstrate a high level of integrity in its compliance program and can be looked upon as a trusted partner when it comes to business affiliations and future business dealings, there is an notable down-stream effect as well.

That’s where the standard requires intense third-party due diligence to verify that the organisation’s supply-chain partners maintain a strong commitment to anti-bribery compliance. This subsequently motivates the organisation’s business partners, suppliers and third-party providers to examine and improve their own practices, knowing that the organisation will not conduct business with outside providers that don’t measure up to its internationally accepted compliance standards.

And managing third-party risks will result in the ongoing supply of high-quality products and services, on-time delivery, reduced legal liability, increased stakeholder protection, higher customer satisfaction and improved reputation, to name just a few of the associated benefits.

ISO 37001 Certification Improves the Organisation

Finally, ISO 37001 certification is structured in a way that not only identifies risks and weaknesses within an organisation’s anti-bribery framework, it also outlines measures designed to improve that framework and, in turn, contribute to strengthening the overall operation. Here are some examples:

Financially, certification can help identify redundancies in the processes used to combat anti-bribery and corruption, potentially reducing the costs associated with duplication. Additionally, through certification, one can assume that demonstrating an adequate procedures defense may in many cases reduce legal costs in bribery cases and investigations, while also reducing or eliminating potential fines levied in such cases.

Operationally, certification can help to streamline internal processes and controls, and – through effective top-down management advocacy – ensure that all staff levels of the organisation stand united in the fight against bribery and corruption.

Ethically, certification shows that the organisation is making a conscientious choice to protect its customers by taking strong stances against the effects of bribery, which include overpriced products or services, defective parts, and under-qualified labor – all of which can produce economic hardship, physical harm or even death.

From a brand perspective, certification demonstrates that the organisation is committed to operating in an ethical environment, taking strong measures to prevent bad actors from succeeding and exposing the organisation to negative media publicity, adverse public reaction and damaged reputation.

And from business development standpoint, certification can effectively enhance the organisation’s ability to secure new business contracts, as public sectors around the world are increasingly requiring such certification as a qualification in the bidding process for large-scale contracts.

It’s no secret why multi-national organisations are increasingly realising the many benefits of ISO 37001 certification, as they enjoy improved internal systems and procedures, greater operational efficiency and top-down confidence throughout the organisation, to reduced corporate risks, stakeholder liability, and a resulting competitive edge in the international marketplace.

ISO 37001:2016 Anti-Bribery Management System certification is offered under CRI Group’s ABAC® Centre of Excellence, an independent certification body established for Anti-Bribery Management System training and certification, ISO 37301 Compliance Management Systems and Risk Management System certification. The program will be tailored to your organisation’s needs and requirements. For assistance in developing and implementing a fraud prevention strategy, contact ABAC today or get a FREE QUOTE now!

Who is CRI Group?

Based in London, CRI Group works with companies across the Americas, Europe, Africa, Middle East and Asia-Pacific as a one-stop international Risk Management, Employee Background Screening, Business Intelligence, Due Diligence, Compliance Solutions and other professional Investigative Research solutions provider. We have the largest proprietary network of background-screening analysts and investigators across the Middle East and Asia. Our global presence ensures that no matter how international your operations are we have the network needed to provide you with all you need, wherever you happen to be. CRI Group also holds BS 102000:2013 and BS 7858:2012 Certifications, is an HRO certified provider and partner with Oracle.

In 2016, CRI Group launched Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management Systems, ISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification. ABAC® operates through its global network of certified ethics and compliance professionals, qualified auditors and other certified professionals. As a result, CRI Group’s global team of certified fraud examiners work as a discreet white-labelled supplier to some of the world’s largest organisations. Contact ABAC® for more on ISO Certification and training.

Filed under: Anti-Bribery Anti-Corruption Solution, Compliance Solution, ISO 37001, Resources, Third-Party Risk Management by admin
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Rent Checks Post-Brexit

Uncertainty around Brexit continues, and the possibility of a no-deal means it is still challenging to predict what will happen when the UK leaves the EU. The Government is yet to release official guidance on what letting agents and Landlords will need to do, should a no-deal Brexit be the outcome of the process. The lack of clarity from the Government has already caused problems. Many landlords are averse to letting their properties to non-UK nationals in case they are in breach of the Right to Rent rules, post-Brexit. The Government is under increased pressure to give clear guidance on post-Brexit Right to Work and Right to Rent checks.

What do we know so far?

Right to Rent is creating a hostile environment in the private rented sector with more landlords refusing to consider renting to non-British nationals, including EU citizens, due to concerns about Brexit. According to research from the Residential Landlords Association (RLA), 44% of private rented sector landlords are less likely to rent to those without a British passport.

The Right to Rent scheme – introduced in 2016 – has never been popular as it requires landlords to carry out immigration checks to make sure that they do not rent a property to someone who does not have the right to live in the UK. Furthermore, landlords face prosecution if they know or have ‘reasonable cause to believe’ that the property they are letting is occupied by someone who does not have the right to rent in the UK.

Potential changes post-Brexit

One change which may be implemented post-Brexit is the introduction of a digital checking service. A white paper in December last year* suggested this would enable prospective tenants to view and ‘verify’ their immigration status. Meaning landlords could confirm the applicant’s eligibility to rent far more quickly. Those renting to foreign nationals from the EU would no longer need to manually check the documents which are currently required under the right to rent legislation.

Summary

There’s no denying that both landlords and EU tenants have many unanswered questions when it comes to Brexit and right to rent legislation, mainly down to the fact that a deal has not yet been decided. The 31st October 2019 should hopefully bring a clearer picture and provide the answers both parties need.

Let us know if you would like to find out more. If you have any further questions or interest in implementing a digital checking service in advance, please do get in contact.

*”The UK’s future skills-based immigration system”, by HM Government

About CRI Group

Based in London, CRI Group works with companies across the Americas, Europe, Africa, Middle East and Asia-Pacific as a one-stop international Risk Management, Employee Background Screening, Business Intelligence, Due Diligence and other professional Investigative Research solutions provider. We have the largest proprietary network of background-screening analysts and investigators across the Middle East and Asia. Our global presence ensures that no matter how international your operations are we have the network needed to provide you with all you need, wherever you happen to be. CRI Group also holds BS 102000:2013 and BS 7858:2012 Certifications, is an HRO certified provider and partner with Oracle.

In 2016, CRI Group launched Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management Systems, ISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification. ABAC® operates through its global network of certified ethics and compliance professionals, qualified auditors and other certified professionals. As a result, CRI Group’s global team of certified fraud examiners work as a discreet white-labelled supplier to some of the world’s largest organisations. Contact ABAC® for more on ISO Certification and training.

Filed under: Background Investigation, Business Intelligence, Investigative Solution, Resources by admin
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Oil and Energy Companies Look to ISO 37001

In December 2017, the world’s largest builder of offshore rigs agreed to pay $422 million in penalties after entering a guilty plea for bribery charges connected with the Petroleo Brasileiro (Petrobras) scandal. Keppel Offshore & Marine Ltd. made illicit payments to both Petrobras officials and government representatives for more than a decade, between 2001 and 2014 (Reuters, 2017). ISO 37001

The sweeping multimillion-dollar bribery scandal that rocked Petrobras led to numerous investor lawsuits and the downfall of disgraced government officials. It also served as the embodiment of the huge risk of bribery and corruption that confronts the entire oil and energy sector.

Such a scandal is less surprising when one considers the scale of the oil and energy sector. It is a massive portion of the world’s economy, dealing mainly in petroleum – including upstream (exploration, development and production of crude oil or natural gas) and downstream (oil tankers, refiners, retailers and consumers) pipeline. As a raw material, petroleum is used for a number of chemical products, including pharmaceuticals, fertilisers, pesticides, solvents, and plastics.

The need to prospect, discover, and realise oil and energy production in various (and often far-flung) locations lends to the vulnerability to fraud – but geographic considerations aren’t the only risk factors.  Perhaps even more impactful is the complexity of business relationships required to operate in the industry – relationships with governments, contractors, regulators, investors/venture partners, equipment suppliers and other parties. Every such interaction and dealing can be considered susceptible to bribery and corruption where cutting corners may be considered profitable or even perceived to be “business as usual.”

Contributing to the risk is the volatile nature of oil and energy prices (along with all levels of the production chain), along with increasing global demand. This drives oil and energy companies to expand into new areas and markets that might carry a higher risk of bribery and corruption, including undeveloped, third-world countries with few controls, lax enforcement, or both. The reality, however, is that when bribery and corruption continues unabated, everyone loses – companies and governments are affected financially, and economic instability is increased.

ISO 37001 Anti-Bribery Management System standard

There is a solution that oil and energy companies can implement to help prevent and detect bribery and corruption: the ISO 37001:2016 Anti-Bribery Management System standard. The standard requires organisations to implement a series of procedures to prevent, detect and address bribery on a reasonable and proportionate basis according to the type and size of the organisation, and the nature and extent of bribery risks faced. It applies to small, medium and large organisations in the public and private sector and can be implemented in any country. Though it will not provide absolute assurance that bribery will completely cease, for organisations in the oil and energy sector that operate across global boundaries, this is a critical layer of protection that provides both anti-bribery controls and a system for compliance with various anti-corruption legislation, such as the FCPA and UK Bribery Act.

ABAC Center of Excellence Limited is accredited as a Conformity Assessment Body (Certification Body) to assist your organisation in attaining ISO 37001 ABMS certification through a thorough bribery risk assessment and audit covering the entire scope of the standard. The audit methodology is evidence-based, meaning any issues raised will be confirmed through adequate evidence that the ABAC Certification team has discovered during the audit.

Auditing techniques take a risk-based approach to examining your organisation’s Anti-Bribery Management System (ABMS), and the ABAC Certification team will increase the scale of the investigation if they determine that a specific process presents on a higher risk side.  Factors such as Impact, Negligence, Minor, Major, and Critical are taken into consideration during the audit.

A separate audit method is a process-based approach where the ABAC Certification examines the organisation’s processes while considering the interaction between those processes.  Finally, there is a sampling-based audit approach where ABAC Certification incorporates an appropriate sampling plan utilising samples from different ABMS processes to conclude and support the audit findings and results.

The audit is extremely thorough in its approach, which results in an accredited certification for the scope of the ISO 37001 Anti-Bribery Management System.  Because of the standard’s international acceptance and the thoroughness of the audit process, such certification can provide a valuable safeguard in demonstrating an “adequate procedures” compliance defence in cases posing a liability for a company’s failure to prevent bribery.

Once certified, an organisation must continue surveillance and undergo a recertification audit over three years to ensure that the organisation still complies with the ISO 37001 ABMS standard. During this time, any changes to processes, the addition of new partners and expansion/acquisition of new assets or energy contracts, etc. are carefully reviewed.

Lessons to learn

In the Keppel Offshore bribery and corruption case, implementing the measures above would have severely mitigated the risk that such a scandal could take root, much less proliferate over 13 years. The certification process involves a number of steps that include on-site audits to reveal any non-conformities – red flag areas that indicate a heightened risk of bribery and corruption. Such an assessment would have uncovered serious problems in Keppel Offshore’s processes, for example, and required corrective action plans to bring the organisation into compliance with its anti-bribery policy.

As corporations like Petrobras and Keppel Offshore have learned, there are deep repercussions for not taking proper preventative action with a robust anti-bribery management system (ABMS). The increase of anti-bribery and corruption legislation cannot be ignored by oil and energy companies, given that such regulations have, in most cases, achieved a global reach. For ownership and management, the stakes are especially high – accountability now includes criminal liability for organisation personnel as individuals, beyond (and in addition to) liabilities faced by the organisation. This trend will only continue as governments, and their publics become increasingly intolerant of fraud, bribery and corruption. Major media coverage and the real and perceived threat to governments’ economies contribute to this changing landscape of public opinion.

By extension, enforcement efforts are also being stepped up. Existing penalties are being applied with more regularities and new ones added with stronger impacts, including imprisonment and large fines – adding to the reputational damage that can occur as a result of bribery and corruption. Laws like the UK Bribery Act are being applied in force across international borders to put teeth in efforts to prevent, detect and punish corrupt corporate behaviour. While ISO 37001:2016 certification does not provide a shield against such enforcement measures, applying its standards can be considered a “good faith measure” for companies facing the consequences of bribery and corruption incurred in the past – and the measures prescribed by ISO 37001:2016 will no doubt have a mitigating effect on risk factors and the scale and scope of future acts of bribery and corruption should they occur.

Conclusion

With so much at stake in terms of money and resources, it should be no surprise that the oil and gas industry is rife with bribery and corruption. In today’s business climate, taking every step possible to prevent and detect bribery and corruption is more than just good business sense: It is essential to ensure a successful future. Implementing a worldwide recognised standard like ISO 37001 is a critical step forward for any organisation in the oil and energy industry.

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Pharma and Healthcare Companies can Benefit from ISO 37001

Pharma and Healthcare Companies can Benefit from ISO 37001

When global pharmaceutical giant GlaxoSmithKline found itself in the Chinese government’s crosshairs for an alleged large-scale bribery scandal, there was perhaps little doubt that the consequences would be large-scale, as well. GSK was accused of systematically paying bribes and “gratuities” to doctors and hospitals in return for favourable product use and promotion. Pharma and Healthcare Companies ISO 37001 Benefits

China was in the midst of an emerging anti-graft campaign and imposed tough penalties against GSK and its executives: In the end, various company leaders were arrested and eventually given suspended prison sentences; GSK was fined $490 million; and the corporation published a statement of apology to the Chinese government and its citizens.

GSK’s fraud was arguably symptomatic of a widespread problem among pharmaceutical companies and healthcare providers (also called “life sciences” providers) with bribery and corruption in economies and healthcare markets around the world. Despite increased awareness of the problem and the application of sophisticated anti-fraud mechanisms, individual actors and agencies continue to defraud public and private health systems in the same ways exemplified by GSK in China.

Generally speaking, healthcare and pharma presents a target-rich environment for fraud. Quantitative data indicate that healthcare fraud has already risen starkly in recent years. The World Health Organisation (WHO) estimates that, where losses have been measured and the types of health expenditure have been covered, the average annual cost of fraud totals 7.29 per cent of healthcare budgets (Gee and Button, 2014). With rapidly ageing populations and the increased costs of providing long-term care, placing substantial pressure upon already overburdened health and social care sectors, healthcare spending will continue to increase worldwide. Unfortunately, this will also bring increased fraud schemes, as fraud perpetrators follow the money.

Bribery and corruption will continue to be a part of this upward trend in fraud. Certainly, not all cases are as broad and sweeping as GSK’s – in some cases, corruption occurs simply because the pharma or healthcare entity doesn’t have proper controls in place to uncover red flags. This also raises serious compliance issues in a landscape that has increasingly stringent regulations and enforcement measures to punish organisations that fail to implement proper anti-bribery and anti-corruption management procedures.

CRI Group investigates: Pharma corruption case included CFO

A major pharma company suspected bribery and corruption among some of its senior employees. The client’s corporate security department had received conflict of interest complaints that reportedly involved a range of employees, from sales personnel on up to the chief financial officer (CFO).

An outside investigation firm was called in launch a risk assessment of the company’s third-party relationships, which included several interviews with identified vendors and suppliers to help ascertain the engagement process and associated risks. This process uncovered the fact that the client had no policy or code of conduct concerning ethics, compliance and standards for appointment of vendors, suppliers and local agents. Most troubling was the fact that in most cases, senior management referred business opportunities to friends and family members.

Investigators found that one of the vendors, which was deeply engaged in procurements and the supply of services for the pharma company over the past five years, raised serious red flags. The vendor’s letterhead lacked a physical address, and the only contact information listed was a single cell phone number. It was clear this vendor warranted further investigation.

Investigators used site visits, background checks and interviews to determine that the suspicious vendor was not a company at all – but a single person. Not just any person, however – a public records check with a national database revealed that this individual, who was posing as a major vendor, was none other than the brother-in-law of the client company’s CFO. Worse still was the fact that this blatant fraud was being conducted right under the noses of procurement and finance professionals at this large and well-known pharma company.

The individual’s residence was being used as a warehouse to help facilitate the fraud. A comprehensive litigation records check found that he was previously convicted in federal court and spent three years in prison for the charges of selling counterfeit products, physician samples and expired medicines; further regulatory checks found that his pharmacist license had been cancelled.

A high fraud risk environment was created through the non-compliance of specific procurement rules, and a lack of integrity due diligence and proper risk management. Also, severe conflicts of interest were exposed, connected to high-level executive positions and benefiting those in positions of power.

The pharma company was exposed to highly unethical practices and could face regulatory and other government action. Furthermore, the company was at risk of civil and criminal investigations and liability, damage to its reputation, and loss in shareholder trust, all of which could adversely affect the company’s financial well-being.

A solution through ISO 37001:2016 ABMS

The case study above is not an outlier – such corruption cases are relatively common in such a broad and complex industry. The pharma company could have prevented the scandal altogether, however, had it proactively implemented a proper anti-bribery management system (ABMS). There is a solution that pharma and healthcare companies can implement to help prevent and detect bribery and corruption: the ISO 37001:2016 Anti-Bribery Management System standard. ISO 37001:2016 is designed to help global organisations implement an anti-bribery management system (ABMS), as the standard specifies a series of measures required by the organisation to prevent, detect and address bribery, and provides guidance relative to that implementation.

CRI Group’s ABAC Certification Services is fully accredited to offer independent ISO 37001:2016 certification to ensure that an organisation is in compliance with the standard, which is recognised and practised worldwide.  CRI Group’s auditors and analysts work with pharma and healthcare companies to develop measures that integrate with existing management processes and controls, and include:

• Adopting an anti-bribery policy
• Establishing buy-in and leadership from management
• Training personnel in charge of overseeing compliance
• Communicating the policy and program to all personnel and business associates
• Providing bribery and corruption risk assessments
• Conducting due diligence on projects, business associates and other third-party affiliations
• Implementing financial and commercial controls
• Developing reporting and investigation procedures

In the case study outlined above, having such an ABMS in place would have detected the red flags of bribery and corruption before the scandal was able to proliferate and cause so much damage to the company. Risk assessments, in particular, would have uncovered the lack of due diligence procedures and alerted organisation leaders to the trouble areas that were points of opportunities for the CFO and his brother-in-law. Also, having proper due diligence procedures in place to vet and uncover fraudulent third-parties would have detected the problem with this vendor from the outset.

Once certified, an organisation must continue surveillance and undergo a recertification audit over three years to ensure that the organisation still complies with the ISO37001:2016 standard. During this time, any changes to processes and any new relationships with vendors and other third-party partners are carefully reviewed.

Long-lasting benefits of ISO 37001:2016 certification

ISO 37001 provides a strong framework for addressing and isolating risk factors, and the benefits of certification are far-reaching, impacting not just the primary organisation but also influencing contractors, clients, and raising the profile of the company as an ethical entity that is a good trading partner.

By achieving ISO 37001:2016 certification, a pharma or healthcare organisation will ensure that the organisation is implementing a viable anti-bribery management system utilising widely accepted controls and systems. It will also assure management, investors, business associates, personnel and other stakeholders that the organisation is actively pursuing internationally recognised and accepted processes to prevent bribery and corruption. Today, companies cannot afford to be reactive to threats of bribery and corruption. By achieving ISO 37001 Anti-Bribery Management System certification today, an organisation will remain in compliance and better positioned to address risks head-on.

Who is CRI Group?

Based in London, CRI Group works with companies across the Americas, Europe, Africa, Middle East and Asia-Pacific as a one-stop international Risk Management, Employee Background Screening, Business Intelligence, Due Diligence, Compliance Solutions and other professional Investigative Research solutions provider. We have the largest proprietary network of background-screening analysts and investigators across the Middle East and Asia. Our global presence ensures that no matter how international your operations are we have the network needed to provide you with all you need, wherever you happen to be. CRI Group also holds BS 102000:2013 and BS 7858:2012 Certifications, is an HRO certified provider and partner with Oracle.

In 2016, CRI Group launched Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management Systems, ISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification. ABAC® operates through its global network of certified ethics and compliance professionals, qualified auditors and other certified professionals. As a result, CRI Group’s global team of certified fraud examiners work as a discreet white-labelled supplier to some of the world’s largest organisations. Contact ABAC® for more on ISO Certification and training.

Filed under: Anti-Bribery Anti-Corruption Solution, Compliance Solution, ISO 37001, Pharmaceutical & Healthcare, Resources by admin
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Risk management and its continuous improvement

Risk management requires continuous improvement. Without a company culture strongly aligned with principles of continuous improvement, organisations will struggle to implement, let alone maintain, successful risk management programs. This can be challenging in practice, as cultivating a risk management attitude within a company involves aligning risk initiatives with existing company values, policies and, to put it simply, convincing everyone involved that risk management is worthwhile. However, improving risk culture is possible, and, like many things, it becomes a lot easier when you have a process for it.

Such a process can be separated into three stages:

• Cultural awareness
• Cultural change
• Cultural refinement

Phase one: Building and strengthening cultural awareness

The first stage is building cultural awareness; this will take the form of communications, training, and general education initiatives within the organisation. Here is where companies set risk management expectations and objectives, define roles and responsibilities, and communicate all of these things with their employees. You shouldn’t expect your employees to conform to your ideas about risk management without first taking the time to educate and inform them, whether through formal training or access to knowledge base material or similar.

Successfully building and strengthening cultural awareness about continuous improvement includes:

• Establishing a common risk management vocabulary
• Making sure communications are consistent with said vocabulary and that everyone in the organisation has clear access to all relevant documents
• Being clear about risk management responsibilities and accountabilities.
• Launching and maintaining training programs, providing training support and guidance where needed and as required by different roles and responsibilities within the organisation
• Making sure onboarding processes adequately cover risk management.
• Making sure recruitment processes adequately cover risk management.

Phase two: Changing the way the organisation operates

Once a firm foundation of cultural awareness regarding continuous improvement has been established, it’s time to start thinking about how to gradually change how the organisation operates to reflect these values. This phase begins by recognising and rewarding employees for paying attention to risk and responding to risk in a way that challenges the previously established (pre-continuous improvement) status quo. These motivational systems, rewarding and penalising behaviour according to the established ideals of continuous improvement outlined in the early planning stages, will result in the gradual but certain shift towards a proliferation of continuous improvement-conscious company culture. Another important element is recognising the talent that conforms with the desired vision of continuous improvement and capitalising on this alignment by placing them accordingly in relevant, optimised positions of responsibility or seniority. It’s getting people in the right place to drive the right results.

Some important considerations for this phase:

• Utilising challenge as a motivator for driving cultural change
• Gamifying and quantifying risk performance metrics and rewarding/penalising behaviour accordingly.
• Considering risk management and continuous improvement culture in talent management approaches.

Phase three: Optimising and refining the cultural ecosystem

The third and final stage of cultural adoption of continuous improvement occurs once the company culture has matured to the point of widespread adoption and desired values are already well-entrenched. At this point, the focus shifts to monitoring performance versus expectations and attempting to tweak and refine the system to further improve cultural adoption. The expectations can and will be influenced by a wide range of stakeholders, not just top management; employees, a board of directors, analysts, customers, investors – they all have a say in the definition of cultural expectations because these expectations should directly reflect the whole entity that is the organisation, made up of all its constituent stakeholder parts.

Steps taken during this phase might include:

• Iterating feedback and observations from risk management into training, education, resources, and communications.
• Making sure stakeholders are held responsible for their actions
• Make sure any risk performance metrics or quantifiers are adjusted to reflect risk strategy, goals, and objectives changes.
• The capacity to redeploy and reassign individuals within an organisation according to desired risk culture goals
• Continually reflecting on and refining risk culture by continually changing business goals, objectives, and strategies.

At CRI® Group, we are committed to spreading the knowledge about the risk, compliance management and negative impact of fraud, bribery, and corruption to global businesses and promote transparent business relations across the world. As part of this effort, we want to present you our in-depth risk management and compliance insights – articles, whitepapers, eBooks, and other publications to help organisations overcome fraud, compliance, bribery, and corruption management challenges and tackle risks more effectively.

Don’t miss the opportunity to step up towards transparency and better protection for your business and your career – CRI® Group’s risk management and compliance insights give you a chance to explore these topics in-depth. If you are interested in our solutions, please click below to a free quote or contact us today.

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Filed under: All Industries, All Regions, Background Investigation, Due Diligence, Resources by admin
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