Third Party Due Diligence Program Design, Implementation and Oversight

A global manufacturer with a prior FCPA enforcement action in its past learned that its third-party business partners in multiple countries may have been making improper payments to foreign government officials to secure the award of government contracts. WCF personnel oversaw a company-wide review of its business intermediaries consisting of the collection of vendor master file and disbursement records from over 500 ERP systems, devising and implementing a risk scoring framework and the performance of over 5000 investigative due diligence reports many of which included in country investigations and site visits spanning over 60 countries. This retroactive review was performed in parallel to the creation and implementation of a much more rigorous vendor onboarding process that included the designation of business sponsors, questionnaires, a sophisticated risk scoring process that considered inherent, relationship, geographic, disclosure and financial risk and an adjudication process in which business sponsors engaged directly with intermediaries seeking clarity on any findings resulting from due diligence investigations. This third-party corruption risk program continues to serve as a gold standard that many organizations have sought to replicate. It was also the centerpiece of the company’s presentation to the DOJ and the SEC which enabled them to enter into a very favorable settlement.