There was a lot of compliance chatter a few weeks ago over JPMorgan Chase’s hiring practices in China and the problems that they have caused for the company. According to a New York Times article, there were concerns that JPMorgan had hired the children of senior officials in order to advance the bank’s business interests.
This story is just the latest in a string that demonstrates that bribes need not involve the direct payment of cash. In spite of this, when my company TRACE does trainings in far-flung locations, we continue to get baffled responses when we describe the scope of the items or favors that may not be provided to a foreign official. People can’t quite believe that a bribe needn’t be a direct payment and that it needn’t actually be provided to the foreign official.
For compliance professionals struggling to communicate these key ideas at their companies, here are four examples that might help drive the point home:
1. Sponsoring Events
There are situations in which sponsoring conferences and training sessions is entirely legitimate, but it doesn’t take long to cross the line when sponsorship of an extravagant event is requested by a foreign official, the agenda is set by the official, and there is no business purpose other than to curry favor and gain an improper business advantage. The problem is easier to spot if the event has political overtones, but it may be as subtle as the official using an elegant event to increase his stature in the community at the company’s expense.
