April 24, 2024 L Burke Files, DDP, CACM President, The American Anti-Corruption Institute (AACI) The first Anti-Money Laundering law was the United States Bank Secrecy Act. It was passed in 1970, the Nixon Administration’s knee-jerk reaction to the boatloads of cash flowing into US banks. There were a few additions in 1986 and 1988, reacting to how the criminals had learned to evade the BSA provisions, but nothing substantive. Substitutive changes in AML and global financial compliance came from the OECD (Organisation for Economic Co-operation and Development) in 1989, which formed a sub-entit ..read more

The Technical Staff, April 22, 2024 Fraud prevention is often hailed as the prudent path, but do stakeholders, including board members, regulators, and partners, truly invest rationally in this pursuit? And if so, do they do so strategically and sufficiently? The answer lies in the intricate tapestry of regional and organizational dynamics. The extent to which an entity invests in preventing fraud and corruption significantly reflects its leadership’s dedication to combating corruption [1]. The foundational component of internal control—the control environment—articulated by COSO.org [2 ..read more

Technical Staff April 17, 2024 Small and Medium-Sized Enterprises (SMEs) play a vital role in the global economy, driving innovation, creating jobs, and fostering economic growth. “They represent about 90% of businesses and more than 50% of employment worldwide. Formal SMEs contribute up to 40% of national income (GDP) in emerging economies.” [1] However, their size and structure can make them vulnerable to various corruption threats. In this blog post, we’ll explore the ten riskiest corruption threats facing SMEs, along with examples and suggested solutions to mitigate them. 1. Bribery and Ki ..read more

Rebuilding Integrity, Upholding Excellence Mike J. Masoud April 13, 2024 Key Insights: Navigating the Road to Ethical Auditing 1. Reform Needed: Urgent calls for significant reform in the audit profession to prevent future ethical lapses. 2. Accountability Matters: Highlighting the crucial role of accountability in maintaining trust in financial reporting. 3. Transparency & Trust: Emphasizing the importance of transparency and trust in rebuilding confidence in audits. 4. Cultural Change: Recognizing the need for a cultural shift towards integrity and ethical conduct within audit firms. 5 ..read more

Mike J. Masoud April 4, 2024 Whistleblowing stands as an unparalleled force in the battle against fraud and corruption. Its potency lies not only in its effectiveness but also in its cost-efficiency. As the vanguards of integrity, whistleblowers play a pivotal role in unveiling malfeasance and upholding integrity within organizations. However, their noble endeavors are often met with severe repercussions from employers who seek to conceal their illicit activities. It is imperative that regulators worldwide establish, implement, and maintain robust frameworks that not only encourage but also pr ..read more

Technical staff April 4, 2024 In the complex landscape of business ethics, leaders often find themselves facing tough decisions that can profoundly impact the integrity and reputation of their organizations. One such scenario arises when undisputed evidence of bribery emerges within the procurement process. This presents a critical juncture where leadership must navigate with wisdom and courage to uphold ethical standards and legal obligations. Consider the following hypothetical: your procurement department receives incontrovertible evidence from a vendor, detailing a request for a bribe in e ..read more

March 30, 2024 Mike J. Masoud Wole Fagbayide Corruption is a global phenomenon that has its roots back in history and will always be present. While there is a consensus on the socioeconomic and political damages corruption causes, experts, and researchers, do not have a well-established agreement on what causes it. Albeit there is a distinct relationship between the rule of law and corruption. Before we delve into this relationship, we presume that nations develop laws to achieve specific objectives. Those objectives should always be for the common good of the society and free from conflicts o ..read more

Technical Staff March 25, 2024 Today is March 25, 2024, and welcome back to “The Edge: Anti-Corruption” podcast series presented by The American Anti-Corruption Institute (AACI). In today’s episode, we highlight the critical issue of conflicts of interest among public officials. While it’s a legal concept, its implications stretch far beyond the confines of statutes, influencing the very fabric of governance and trust in institutions. Defining Conflict of Interest First and foremost, let’s define what we mean by a conflict of interest. Simply put, it occurs when an individual, typically a pub ..read more

Mike J. Masoud March 20, 2024 Introduction In the wake of Episode 8 of The Edge: Anti-Corruption Podcast, which explored “Detecting Corruption: 10 Red Flags Every Organization Should Watch For,” it is evident that heightened awareness and proactive measures are imperative in combating fraud and corruption within organizations. This blog post serves as a follow-up, emphasizing the critical role of board members, management, employees, government regulators, and other stakeholders in fostering a culture of transparency, accountability, and integrity. First: Heightened Anti-Corruption Awareness ..read more

Mike J. Masoud March 14, 2024 In today’s increasingly complex business landscape, the importance of anti-corruption training for top and middle management cannot be overstated. These training programs serve as a fundamental pillar in cultivating integrity, fostering accountability, and promoting effective internal control [1] and governance [3] within organizations. By instilling a culture of ethical conduct throughout the organization, such training initiatives have a profound impact on the success of the organization and the performance of individual managers [4]. At the core of any anti-cor ..read more