What went wrong when McKinsey paid bribes to secure consulting contracts with South Africa's state-owned enterprises? In this episode, Michael Volkov dives into the December 2024 DOJ settlement with McKinsey & Company, which paid $122 million after being found guilty of paying bribes to officials at Transnet and Eskom to secure valuable consulting contracts. The case involved significant violations of the Foreign Corrupt Practices Act (FCPA) and highlights the risks companies face when failing to implement effective compliance programs.

You’ll hear him discuss:

• The details of McKinsey's settlement with the DOJ for $122 million, including the 35% discount and the cooperation credits granted by the government.
• The role of Vikas Sagar, McKinsey's former senior partner, and his guilty plea in 2022 for orchestrating bribery payments.
• How McKinsey Africa used sensitive, non-public information obtained through bribes to secure multi-million dollar contracts with Transnet and Eskom.
• The ongoing issue of engaging third-party intermediaries and the importance of conducting thorough due diligence before entering into business relationships.
• The lessons learned from McKinsey’s lack of proper oversight and controls that allowed a small group of corrupt executives to facilitate bribery schemes.
• The broader impact of local content requirements in international business and the associated risks of partnering with unqualified entities that have ties to corrupt government officials.

Resources

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What happens when a Chief Executive Officer becomes the architect of a global bribery scheme? In this episode of Corruption, Crime, and Compliance, Michael Volkov delivers an in-depth analysis of the BIT Mining FCPA case — a landmark matter that underscores the severe consequences of C-suite misconduct. With CEO Zhengmin Pan at the center of the conspiracy, BIT Mining’s efforts to infiltrate Japan’s emerging casino market were built on fraudulent payments, sham contracts, and falsified financial records.

Michael examines the tactics used to conceal illicit payments, the role of Japanese authorities in uncovering the misconduct, and the broader implications for corporate compliance and executive accountability.

You’ll hear him discuss:

• How BIT Mining’s former CEO, Zhengming Pan, supervised a $2 million bribery scheme targeting Japanese government officials to secure entry into Japan’s integrated resort (IR) market.
• The specific tactics used to launder bribe payments, including the use of sham consulting agreements, inflated lecture fees, and misclassification of bribes as "management advisory fees" and "travel expenses" in company records.
• The DOJ’s charges against Pan, which included conspiracy to violate the anti-bribery and books-and-records provisions of the FCPA, as well as multiple counts of books-and-records violations and substantive anti-bribery offenses.
• The terms of Bit Mining’s three-year Deferred Prosecution Agreement (DPA) with the DOJ, which included an agreed-upon $10 million criminal penalty, reduced from an initial $54 million based on the company’s inability to pay.
• The SEC’s parallel enforcement action, which resulted in a $4 million civil penalty, later credited against the DOJ’s settlement amount.
• How Japanese enforcement authorities played a crucial role in uncovering the scheme and what ultimately led to Bit Mining’s failure to win the integrated resort bid.
• Practical compliance takeaways for corporate boards and executive teams, including the importance of strong third-party due diligence, financial control safeguards, and executive oversight to prevent and detect misconduct at the top.

Resources

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What does it take for a global telecom giant to get caught up in a bribery scheme involving over $85 million—and what can we learn from their mistakes? How do companies like Telefónica Venezolana manage to conceal millions in bribes through inflated contracts and shell companies, and why do these schemes so often fly under the radar?



This episode dives into Telefónica Venezolana's $85.2 million settlement with the DOJ for bribery violations under the FCPA. Michael Volkov unpacks how the Venezuelan subsidiary exploited a government-controlled currency auction system, paid nearly $29 million in bribes, and concealed it through inflated equipment purchases. The case reveals systemic flaws and offers essential lessons on preventing corporate misconduct.

You’ll hear him discuss:

• How Telefónica Venezuela used inflated supplier contracts to fund $28.9 million in bribes
• The role of shell companies and intermediaries in concealing bribery schemes
• How bribery enabled access to $110 million in undervalued U.S. currency
• DOJ's assessment of cooperation, compliance efforts, and penalty reductions
• Telefónica’s failure to address red flags in its financial controls and due diligence processes
• The importance of vetting third parties and managing high-risk transactions
• How Telefónica implemented compliance reforms, including anti-corruption measures and internal audits
• Lessons for compliance professionals on detecting and preventing similar schemes

Resources

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The Volkov Law Group

Have you ever wondered how different cultures and generations engage with a company's code of conduct? Do employees across the globe really follow ethical guidelines in the same way, or are there stark contrasts depending on where they are and what they do? In this episode of Corruption, Crime & Compliance, Michael Volkov explores LRN's latest Code of Conduct Report, which reveals vital benchmarks and trends that can help companies strengthen their ethics and compliance programs. As LRN consistently provides high-quality insights on ethics and compliance, this episode dives deep into the findings that highlight how the code of conduct can serve as the cornerstone of a company's ethics culture—if used effectively.

You’ll hear him discuss:

• How the usage of codes of conduct differs across geographic regions, with India, China, and Australia showing the highest engagement rates.
• The surprising statistic that 35% of employees in the Netherlands reported never consulting their company’s code of conduct.
• The impact of training, with countries like China and India seeing the highest percentage of employees trained on their code of conduct.
• The generational divide, with Gen Z employees consulting their codes of conduct more than Baby Boomers, despite prior reports suggesting Gen Z's tendency to bend rules.
• The significant gap in perceptions of code usage between senior leaders, middle managers, and frontline employees.
• The role of hybrid work in fostering higher engagement with codes of conduct, contrary to the common assumption that remote work leads to disengagement.

Resources

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The Volkov Law Group

What does the new Trump administration mean for ethics, compliance, and enforcement? As the dust settles on the U.S. election, companies are evaluating the implications of President Trump’s return to the White House. With priorities such as spurring economic growth, reducing inflation, imposing stringent trade sanctions, and reforming the Department of Justice, businesses must prepare for significant changes. How will these initiatives impact compliance programs and enforcement priorities?

You’ll hear Michael discuss:

• Key enforcement priorities under the second Trump administration, including changes to DOJ oversight and trade compliance.
• The implications of aggressive foreign policy shifts, including potential changes to sanctions on Russia, Iran, and China.
• The focus on immigration enforcement, workplace audits, and I-9 compliance.
• The anticipated reduction in environmental and workplace safety enforcement.
• Trends in corporate criminal enforcement, including a steady focus on healthcare fraud but limited activity in other areas.
• Strategies for companies to enhance trade compliance and prepare for expanded tariffs and sanctions.

Resources

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The Volkov Law Group

What happens when a major defense contractor faces scrutiny for ethics and compliance violations? In this episode of Corruption, Crime, and Compliance, Michael Volkov dives into the high-stakes world of corporate accountability, exploring Raytheon's recent $428 million settlement with the U.S. Department of Justice. From fraudulent pricing to bribery and compliance lapses, we uncover the impact of these violations and the tough questions they raise about corporate governance, oversight, and ethical responsibility in high-stakes industries.

Hear Michael talk about:

• Raytheon Company (Raytheon) -- a subsidiary of defense contractor, RTX (formerly known as Raytheon Technologies Corporation) — agreed to pay over $950 million to resolve the Justice Department’s investigations into three areas of violation. 
• The settlement addresses three main issues:
• A major government fraud scheme involving defective pricing on certain government contracts
• Violations of the Foreign Corrupt Practices Act (FCPA)
•  the Arms Export Control Act (AECA) and its implementing regulations, the International Traffic in Arms Regulations (ITAR)
• As part of the settlement, Raytheon entered into a three-year deferred prosecution agreement (DPA) and agreed to the filing of criminal information in the District of Massachusetts charging Raytheon with two counts of major fraud against the United States. Raytheon admitted to engaging in two separate schemes to defraud the Department of Defense (DOD) relating to the provision of defense articles and services, including PATRIOT missile systems and a radar system. 
• Separately, Raytheon entered into a three-year DPA in connection with a criminal information in the Eastern District of New York charging Raytheon with two counts: conspiracy to violate the anti-bribery provision of the FCPA for a scheme to bribe a government official in Qatar and conspiracy to violate the AECA for willfully failing to disclose the bribes in export licensing applications with the Department of State as required by part 130 of ITAR.
• The Justice Department’s FCPA and ITAR resolution is coordinated with the Securities and Exchange Commission (SEC). Both DPAs require that Raytheon retain an independent compliance monitor for three years, enhance its internal compliance program, report evidence of additional misconduct to the Justice Department, and cooperate in any ongoing or future criminal investigations. Raytheon also reached a separate False Claims Act settlement with the Justice Department relating to the defective pricing schemes.

Resources

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The Volkov Law Group

The SEC notched another FCPA settlement, continuing its steady pursuit and resolution of FCPA cases. In the meantime, the Justice Department has been silent in the FCPA enforcement arena. In this episode of Corruption, Crime, and Compliance, Michael Volkov dives into the SEC’s recent FCPA settlement with Moog, a global manufacturer that faced severe bribery allegations within its Indian subsidiary. From navigating India's complex tender processes to revealing corrupt practices and hefty penalties, Michael dissects Moog's compliance failures and highlights the critical role of ethics in international business dealings.

Listen in as he discusses:



• Moog, Inc. ("Moog"), a New York-based global manufacturer of motion controls systems for aerospace, defense, industrial, and medical markets, agreed to pay a civil penalty of $1.1 million and disgorge nearly $600,000 for a total of $1.7 million, to resolve FCPA charges arising out of bribes paid by its wholly owned Indian subsidiary, Moog Motion Controls Private Limited (Moog Motion Controls).
• Moog India allegedly bribed officials from the South Central Railway (SCR) and Hindustan Aeronautics Limited (HAL) to influence tender processes and exclude competitors. These bribes were often disguised as “contractor services.”
• From 2020 to 2022, Moog employees bribed various Indian officials to win business. Also, they used a variety of schemes to make improper payments, including funneling them through third-party agents and distributors. These same Moog employees also offered cash bribes to Indian officials in an attempt to cause public tenders in India to favor Moog’s products and exclude competitors.
• The case highlights significant gaps in Moog’s internal controls, including improper invoice recording, inadequate oversight of third-party agents, and a lack of compliance training.
• Moog self-reported the misconduct, terminated those involved, enhanced its compliance program, and strengthened accounting controls and auditing procedures for third-party interactions.

Resources

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The Volkov Law Group

How does a respected financial institution turn into a criminal operation? In this episode of Corruption, Crime, and Compliance, host Michael Volkov dives into the record-breaking $3 billion settlement between TD Bank and the Department of Justice over pervasive violations of the Bank Secrecy Act (BSA) and Anti-Money Laundering (AML) laws. Highlighting TD Bank's systemic failures, Michael explores how the bank's compliance and oversight lapses led to criminal conduct within its operations, making it a case study on the dangers of prioritizing growth over legal compliance. From failed AML programs to enabling money laundering on a massive scale, this episode sheds light on the regulatory crackdown TD Bank now faces.



Hear him discuss: 

• TD Bank’s $3 billion penalty sets a new high for banking compliance cases. In yet another reminder of the scope of Justice Department enforcement powers, and an important demonstration of the risks of non-compliance, the Justice Department and relevant banking agencies announced a $3 billion settlement with TD Bank companies to resolve systemic and pervasive Bank Secrecy Act ("BSA") and money laundering violations.
• TD Bank’s internal culture sidelined AML compliance, leading to massive oversights, including unmonitored transactions worth $18.3 trillion from 2018 to 2024. 
• TD Bank enforced a “flat-cost paradigm,” restricting the compliance budget, which prevented updates and adaptations needed to meet new risk levels.
• TDBUSH pleaded guilty to causing TDBNA to fail to maintain an AML program that complies with the BSA and to fail to file accurate Currency Transaction Reports ("CTRs").
• Despite multiple warnings from internal audits and third-party consultants, the bank maintained its flawed AML protocols without significant action.
• TD Bank earned the ignominious record: TD Bank is the largest bank in U.S. history to plead guilty to Bank Secrecy Act program failures, and the first US bank in history to plead guilty to conspiracy to commit money laundering.   
• With this settlement, TD Bank joins a list of high-profile compliance failures alongside companies like Wells Fargo and Wirecard, furthering the call for financial institutions to prioritize ethical compliance in their growth models.

Resources

Michael Volkov on LinkedIn | Twitter

The Volkov Law Group

How can companies ensure that their compliance programs are robust enough to handle today’s complex ethical challenges? In this episode, Michael Volkov dives into the critical components of conducting an internal compliance site visit and review. He highlights the significance of these visits in understanding operational risks and compliance culture. With real-world examples, Michael emphasizes the need for a proactive approach to compliance, ensuring that organizations are not only following regulations but also fostering an ethical environment.

Listen in as Michael talks about:

• Conducting personal interviews with key staff to assess the compliance culture and operational challenges.
• Reviewing and testing transactions across various vendor categories to ensure compliance with protocols.
• Evaluating the effectiveness of training programs and employee understanding of ethical standards and compliance awareness.
• Verifying compliance with internal policies and conduct due diligence on charitable contributions.
• Assessing the compliance processes surrounding sponsorships and their alignment with company policies.
• Implementing thorough due diligence practices for third-party vendors to mitigate risks.
• Reviewing employee expense reports to ensure proper documentation and compliance with gift, meals, entertainment, and hospitality policies.

Resources

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The Volkov Law Group

What happens when a single company dominates a crucial segment of the financial market? In this episode, Michael Volkov explores the Justice Department's recent antitrust lawsuit against Visa, highlighting allegations of monopolization and exclusionary practices in the debit card market. With Visa controlling over 60% of debit transactions in the U.S., the DOJ aims to restore competition and prevent further stifling of innovation in this vital financial sector. Tune in as Michael breaks down the case details, Visa’s strategic responses, and the implications for the broader financial landscape.

Listen in as Michael discusses:

• The DOJ has charged Visa with monopolization and exclusionary conduct under Sections 1 and 2 of the Sherman Act.
• Visa holds over 60% of the U.S. debit transaction market, with MasterCard as its closest competitor at 25%.
• The complaint alleges Visa engages in exclusionary agreements that penalize banks and merchants for using alternative debit networks.
• The 2010 Durbin Amendment aimed to increase competition but has had minimal effect on Visa’s dominance, leading to ongoing scrutiny.
• Visa's strategies include partnering with potential competitors while leveraging significant market power to suppress competition.
• Following successes in technology sector enforcement, the DOJ is now expanding its scrutiny into financial markets, indicating a potential shift in antitrust enforcement dynamics.

Resources

Michael Volkov on LinkedIn | Twitter

The Volkov Law Group