Kate Atkinson Comments on FCPA Compliance Monitors in Main Justice

"Data Show Trend Away from Monitors for Voluntary Disclosure"
Main Justice
05.31.12

Kate Atkinson comments on the imposition of independent compliance monitors as part of settlements with the Department of Justice regarding voluntary disclosure of potential FCPA violations and areas in which the use of monitors could be improved. Corporations have raised concerns regarding the cost of monitors, especially when combined with potential fines and disgorgements. "The fundamental tenet of FCPA compliance is ensuring that a corporation’s assets are spent effectively and in keeping with core values," said Atkinson. She noted that oversight of monitors and their fees could improve, and that a first step is defining the client. "Some people say it’s the government, some people say it’s the board. I think of the client as a hypothetical long-term shareholder . . . I think a monitor has to be careful in how he or she spends the money that belongs to the shareholders."

Another area of concern is the absence of attorney-client privilege between a company and its monitor. "The release of internal processes that company uses to the wider public could in fact be used by competitors in a way that could harm the company. . . There are good reasons for [monitor’s report’s] not to be privileged, but on the other hand it is essential that monitors have access to proprietary information," said Atkinson.

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