“It didn’t make sense.” I have now read that line from two very different compliance scandals.

The first one involved the Hewlett-Packard payment of bribes to make a sale of hardware into the Moscow Prosecutor’s Office, and was one of three actions which violated the Foreign Corrupt Practices Act and led to HP agreeing to a fine and penalty of $135 million. This line was uttered to the Wall Street Journal, which broke the story, by a contract accountant on the transaction in question. He could not understand how a $10 million commission payment could be made by HP to one agent, with no contract with HP, who delivered no services to HP, where the money would be wired to an offshore bank in the Jersey Islands, and (finally) when the commission was 25 percent of the total sale.

The second time I read it was in connection with the ever-burgeoning VW emission-testing scandal, where the company created software to avoid emissions testing standards for its worldwide diesel fleet of autos. This second use of this eye-catching phrase was provided by John German, from the International Council on Clean Transportation who said, in a New York Times article, that when VWs were tested in laboratory conditions they performed flawlessly—but when they were tested on the road at speeds up to 70 mph, the emission readings were way to high. “It didn’t make sense,” German was quoted as saying. “That was the real red flag.”

That singular line, it didn’t make sense, is one of the simple keys to FCPA compliance—or most any other form of compliance, such as environmental compliance. The reason is simple: if an employee’s stomach is in a knot, if the hair on the back of his neck stands up, if something smells bad; that employee must know where he can go with his concerns.

If employees do not know where to raise such concerns, you have corruption situations, such as the HP enforcement action. But it is incumbent on companies to provide not only the training on how employees can raise their hands and raise a concern; someone must be on the receiving end of such a concern. And that original employee will not be at the receiving end of retaliation if he raises his hand.

The VW emissions-testing scandal continues to fester and grow. It will also continue to provide some of the best teaching moments for anti-corruption compliance such as the FCPA. 

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