“Being a Compliance Officer is a very challenging job. It requires engagement, creativity, and flexibility to gain commitment in creating a compliance culture.”
— Richard L. Cassin, Founder & Editor-at-Large, FCPA Blog
This week, we explore corporate Department of Justice (DOJ) criminal enforcement predictions for 2023 and the unique challenges of building a top-down culture of compliance that leaders will face. We also consider whether trainees overrate their compliance knowledge through the Dunning-Kruger Effect and learn how compliance teams at banks and other financial institutions are taking steps to mitigate the use of unauthorized messaging platforms like WhatsApp.
Corporate Criminal Enforcement Predictions for 2023
Recent DOJ corporate enforcement policy changes and clarifications hint at what to expect from the DOJ in the year ahead. The revamped corporate criminal enforcement policies announced in September broaden the DOJ’s consideration of a company’s past misconduct, doubles down on their commitment to holding individuals accountable for corporate misdeeds, and clarify what they will require of companies who seek “full” cooperation and voluntary disclosure credit. In recent weeks, the DOJ’s top brass have expanded on these goals and previewed more updates for the new year. With the DOJ’s promise to continue updating corporate enforcement guidelines, companies should look to update their compliance programs to conform to new policies. Learn more about the updated guidelines and explore how the DOJ will likely approach criminal enforcement in 2023.
Do Trainees Overrate Their Compliance Knowledge?
The Dunning-Kruger Effect occurs when a person’s lack of knowledge and skills in a particular area causes them to overestimate their competence. By contrast, this effect also causes those who excel in a given area to think the task is simple for everyone and underestimate their relative abilities. Unfortunately, Compliance Officers should worry about underachievers the most when it comes to compliance training. More than a third of all compliance trainees likely overrate their competence. That means they may not seek needed compliance training and, too often, will rely on their perceived knowledge. As a result, they can take wrong turns without realizing it. Learn more about how the Dunning-Kruger Effect applies to compliance training and what compliance leaders can do to ensure the training sticks.
Compliance Officer Challenges and Frustrations Getting Board and Management Commitment to Compliance Culture
A Compliance Officer’s biggest challenge is establishing a solid commitment to creating a culture of compliance and obtaining recognition. There needs to be a compliance “tone from the top” of an organization. Educating board members and upper management on the importance of compliance culture, having the resources needed to adequately create and operate the program, and the long-term benefit of effective compliance is a significant first step to building a culture of compliance. Explore the unique challenges of building a top-down culture of compliance that compliance leaders face and how to address them to develop an effective program.
What’s Up with WhatsApp?
People prefer to use certain apps personally, but that doesn’t mean they’re acceptable to use in business settings. For example, WhatsApp, an unauthorized messaging platform, has been the subject of multiple SEC probes. As a result, regulators are cracking down on the use of these unauthorized communications platforms to prevent fraud and other industry violations. Compliance officers face significant challenges in addressing and preventing unauthorized communications. Platforms like WhatsApp are often used outside compliance’s traditional purview. There aren’t many solutions on the market that can handle the threat they pose to good governance. Still, compliance teams at banks and other financial institutions are taking steps to mitigate these risks. Find out how compliance teams are trying to meet this challenge.