In the recent Teva Pharmaceuticals FCPA enforcement action, the SEC Complaint laid out one of the best descriptions of a paper compliance program I have recently seen. To set the stage, the company had been made aware of illegal payments in its Mexico subsidiary, investigated the allegations and then fired several employees involved. The next step was for the company to upgrade its compliance program going forward.
However the company’s efforts seem to stop there. The Complaint related, “In April 2011, a Teva employee responsible for overseeing the implementation of the anti-corruption compliance program emailed a senior executive responsible for overseeing compliance in Latin America. The email stated that a senior Teva executive had “specifically instructed not to implement a robust system that will enable us to monitor and assure that the same doctor wasn’t invited to a meal more than three times (for example)” and that “the purpose of the global FCPA tool under development is mainly to automate the manual forms; get a more organized and easy process of authorisations with less paper work.””
