Linda Willett
Linda Willett (Carmen Natale)

When Horizon Blue Cross Blue Shield of New Jersey went looking for a new chief compliance officer last year, dozens of candidates were screened, but the one that was the right fit turned out to be an attorney.

“People have different views on this, but my own view is, background as a lawyer is a very strong background” for compliance, said general counsel Linda Willett, who oversaw a revamping of the compliance function in recent years.

Horizon’s high-and-low search, which ended in January with the hiring of an attorney with both in-house and firm experience, illustrates what recruiters, consultants, and other insiders say is an increased demand for compliance professionals—and a growing appetite for lawyers in those roles.

“I think it’s a very rich environment for job creation,” she said. “If I were a law student or a lawyer” looking for work or a career change, “I think I would spend some time getting some compliance experience.”

Recruiters agree. “Demand for experienced compliance people is really as high as I’ve ever seen it,” said Brian Davis, a New York partner at recruiter Major, Lindsey & Africa. It has “gone from kind of a back-office job to front and center” and is “a career path for people who want to become general counsel.”

“Ten years ago…we rarely got calls for compliance professionals,” but now there’s “way more demand than supply in this space, and we don’t see that changing,” Davis added.

David Garber, president of Princeton Legal Search Group, said “there’s a regular and constant demand” for chief compliance officers and other compliance professionals.

Garber’s firm—which recruits mostly, but not exclusively, lawyers for those roles—recently placed a CCO at a global pharmaceutical company and is searching for a deputy CCO for a medical device company.

Another recruiter, Billie Watkins, who oversees the New York office of Robert Half Legal, also said demand for compliance professionals has been higher in the last two years.

“It’s not a ‘nice to have,’ but a ‘need to have’ position,” she said. “There’s a good reason to be optimistic if you’re looking for one of these roles.”

Often, the challenge is culling a candidate who fits the bill, she said. “Good talent is definitely hard to find…You can look at 1,000 résumés and find five good ones.”

In terms of compensation, Watkins said, “you could be talking about hundreds of thousands of dollars,” and even rank-and-file compliance jobs come with good pay. An in-house compliance attorney could fetch an annual salary of up to $175,000, plus bonuses, and a J.D.-preferred compliance associate could earn up to $120,000, she said.

Various forces are driving the demand. Regulatory schemes have changed in recent years—especially in the financial sector, with the Dodd-Frank Wall Street Reform and Consumer Protection Act, and the health-care and pharmaceutical sectors, with the Sunshine Act.

Last decade’s financial meltdown ratcheted up scrutiny of financial institutions, and government agencies became more active—sometimes imposing corporate integrity agreements that require alterations to the compliance function.

JPMorgan Chase, for example, spent more than $1 billion in 2013 on reforms, hired more than 3,000 employees to enhance risk and compliance efforts, picked a new compliance chief and split compliance from the general counsel’s purview, according to a March 1 article in Corporate Counsel, a sibling publication of the Law Journal.

Other companies want to stay ahead of the curve or improve their reputations by installing an established professional, often a lawyer, to leading compliance roles, the recruiters said.

Most often, it’s as simple as protecting wealth, according to Davis. “The risks are really severe,” and a regulatory action “can bring down an entire operation,” he said. “I always think of it as, ‘we’re rich and we want to stay rich.’”

Though there’s no golden rule, an increasing number of corporations are, like JPMorgan Chase, separating compliance from the law department. The Association of Corporate Counsel last October found that, of 630 CCOs surveyed, 39 percent report to the chief executive officer, while 36 percent report to the general counsel.

“There has to be support and buy-in from the highest levels of the organization,” Garber said. “It has to become part of the fabric of the culture of the company.”

When Willett joined Horizon in 2010, compliance chief was under the general counsel’s aegis. But soon after, she decentralized that role, appointed a CCO who reported directly to a Board of Directors committee, and reassigned law department resources, including two attorneys, to compliance.

When the CCO, Colleen Brennan, departed last October, Horizon enlisted the help of Major Lindsey partner Paul Williams, who warned that finding the right candidate would take some time.

Willett said they “were very lucky” to get Timothy Susanin, who previously was a litigation partner at Baker & Hostetler. Before that, he was general counsel at WellCare Health Plans Inc., headed Gibbons’ Philadelphia office, and was a federal prosecutor and a member of Kenneth Starr’s Whitewater prosecution team in the late 1990s.

Two of the CCO’s direct reports, who oversee HIPAA compliance and code of conduct, have J.D.s, and the company is searching for a Medicare compliance officer, preferably one with a legal background, Willett said.

Kevin Clem, managing partner of HBR Consulting—a law department consultant that recommended the structuring changes adopted at Horizon—said he’s “seen the most acute need for clear delineation” in pharmaceuticals, because of corporate integrity agreements, though many companies still treat legal and compliance as the same thing.

Clem said there’s “often a bit of a gray line between what’s legal work and what’s compliance work” and “the skill set is somewhat interchangeable,” but either way there’s an “increased demand for compliance professionals.”

Issues such as social media and data security, once the province of information-technology or human-resources units, now are central to running a business and demand a lawyer’s eye, he said.

Lauren Chung, a senior director in HBR’s New York office, added that “the role of the lawyer in the corporation is really taking shape.

“Opportunities for lawyers…are beyond the law department,” she said. “We don’t see that changing anytime soon.”

The demand is not just for in-house professionals but for the services of outside counsel who can advise on compliance issues, said Michael Weinstein. He heads the white collar defense and investigations practice group at Cole, Schotz, Meisel, Forman & Leonard in Hackensack, which includes internal corporate investigations, and is a former Justice Department trial attorney.

Corporations “have a deep need to understand the law,” Weinstein said. “If you have a nonlawyer in that [compliance] role…that can be a bit of a challenge.”

Weinstein said it’s common for existing clients to call with a single compliance question that quickly gives rise to many more. “From that initial call, it develops into a pretty robust engagement.”

He added: “Certainly I see friends and colleagues who have gone in-house when they’ve taken this path” of corporate investigations practice.

Those picked for CCOs typically have in-house experience already, and the most desirable candidates for other compliance positions have regulatory backgrounds, though prosecutorial and litigation experience counts, too, recruiters said.

Getting the requisite experience may be more easily said than done, especially for an attorney who’s already practicing. Additional education may be necessary, Watkins said, noting a sixth-year associate at a Connecticut law firm who took a internship with a broker-dealer.

At least a few law schools appear to be keying in. Seton Hall University School of Law now offers a compliance fellowship—and it was Horizon that recently accepted the school’s first compliance fellow, according to Willett.

Brooklyn Law School Dean Nicholas Allard previously told the Law Journal that the school is pushing students toward corporate compliance and other nontraditional law positions that require or greatly benefit from a law degree.

Garber said it’s possible to get some necessary experience while in a firm setting.

“To the extent lawyers can develop a compliance practice…that’s a good thing, and it may provide an entrée into the corporate world.”

Contact the reporter at dgialanella@alm.com.