Risking it all? - How to manage financial crime risks at executive and board levels

Financial crime can impact companies heavily and even ruin then. How should a company and its advisors respond to allegations that senior managers have been involved in fraud, bribery or corruption?

The case study "Risking it all" is an interactive simulation of the deliberations during a meeting of senior directors as they seek to deal with whistleblower allegations of fraud and bribery by employees of the company. The film depicts the potential consequences should an investigation of this type be approached in the wrong way or otherwise seriously mishandled. Among its many learning points it covers the importance of conducting an independent investigation, the scope of the investigation and what would constitute appropriate and in appropriate action.

The case-study will discuss at various points the options available and what Dos and Don'ts would be. This session is facilitated by members of PwC's forensic investigations team.

At the end of the training, participants wil be able to:

• understand the importance and the scope of conducting an independent investigation while facing frauds and bribery within their organisation
• know what would constitute appropriate and inappropriate action
• be aware of potental consequences should an investigation of this type be approached in the wrong way or seriously mishandled

The case-study highlights and illustrates the multiple temptations of senior company executives:

• i. in using improper accounting practices with various objectives (revenue increase to match market expectations and achieve individual goals;
• ii. in bribing other corporate or government officials to ensure the gain of lucrative contracts.

Ignoring such issues introduces the possibility of financial statements adjustments, regulatory or criminal prosecutions, other lawsuits, disbarment from government tendering, a beaten down share price and a destroyed reputation.

It is the responsibility of the audit committee to fully capture the company business and the global group chart (local and international). For multinational where the risk is greater, it is a must to promptly enquire as soon as the smallest sign of irregularity is detected. Don't forget your independance and personal liability.

As per the latest EU Directive, a specific reporting framework is required in the context of whistleblowing.

It is critical for the audit committee, the senior management and the auditors to know:

• i. how to react in case of crisis;
• ii. what are the pittfalls in terms of decisions.

The case-study will highlight the various available options, will present the Dos and Don'ts.

This training is coordinated by Michael Weis, Partner at PwC Luxembourg.

Michael is the leader of Forensic services and AML/Anti-Financial Crime in Luxembourg.

Michael is leading a large variety of financial crime projects, including AML investigations, remediation and prevention projects in various industries, incl. asset management and banking.

Michael has a strong experience of incident management and crisis situation in the context of high-profile AML investigations. As part of his work Michael has already worked several times as on behalf of the financial regulator CSSF in the context of the “Panama Papers” or similar special reviews for financial institutions. Michael is also involved in anti-sanction reviews with regards to OFAC or EU sanctions and regularly involved in forensic investigations.

As part of his project experience, Michael has extensively worked for EU owned Financial Institutions (bank and investment fund) in Luxembourg.

Michael is recognised as a subject matter expert on AML and forensic matters; he is key member of the local industry working groups on fraud at the Institut Luxembourgeois des Administrateurs (ILA) for directors and a founding director of the Luxembourg Chapter of the Association of Certified Fraud Examiners (ACFE).

As a regular speaker at the International Symposium on Economic Crime, Cambridge, UK, Michael has regular contact and good connections to leading international law enforcement practitioners and regulators. He is regularly featured as speaker at conferences and facilitating workshops in the context of financial crime and Forensic services.