Increased surveillance on ESG
Throughout 2023 the global regulatory and financial crime compliance community saw a wave of regulations covering a wide range of issues, from financial crime prevention, climate reporting and broader environmental, social and governance (ESG) matters, to digital currencies and consumer protection.
Environment, Social, and Governance (ESG) facing increased scrutiny 2023 was set to be a crucial year for ESG, with governments across the world implementing new initiatives. The EU adopted a range of broad ESG-related measures. The UK amended its Companies Act to incorporate new guidelines from the Task Force on Climate-Related Financial Disclosures (TCFD), while the Financial Conduct Authority (FCA) held companies’ compliance performance with this update to account.
These additional points emphasize the growing complexity and global nature of compliance challenges faced by organizations in 2023. The focus is not only on traditional areas such as anti-corruption and sanctions but also on emerging issues like ESG compliance, technological ethics, and the risks associated with digital assets and AI.
Developments for whistleblowers around the world, 2023
Many countries have been working on or amending legislation to protect whistleblowers. The implementation and effectiveness of such laws vary, but there has been a global trend towards recognizing the importance of protecting individuals who come forward with information about wrongdoing.
The UK’s Financial Conduct Authority (FCA) Consumer Duty took effect in 2023, with significant implications for all FCA-regulated firms. The Duty has been in force since the end of July, but much implementation and remedial work is still ongoing.
Ukraine Begins Anti-Corruption Initiative.
On February 1, 2023, Ukrainian authorities started carrying out anti-corruption searches that target politicians, civil servants, and oligarchs. The Ukrainian Security Service (SBU) said that the raids were part of an effort to combat what it describes as “the internal enemy” of the country. Among those targeted in these efforts is the acting head of the Kyiv tax authority, who was allegedly part of a scheme to overlook approximately $1.2 billion in unpaid taxes; the former management of Ukraine’s largest oil extraction and refinery firms for misappropriating approximately $1.1 billion; and the former head of the Ministry of Defense for spending approximately $2.7 million on inadequate bulletproof vests. Anti-corruption reforms are a key requirement for Ukraine's potential membership in the EU.
Record $279 Million Whistleblower Award Went to a Tipster on Ericsson.
The record $279 million whistleblower award issued by the Securities and Exchange Commission stemmed from a bribery case against telecommunications company Ericsson.
The award from the SEC’s cash-for-tips program was related to the $1.1 billion settlement the Swedish company reached with U.S. authorities in 2019 over allegations it conspired to make illegal payments to win business in five countries, in violation of U.S. antibribery laws, according to people familiar with the matter.
Landmark Reversal
On February 28, 2023, the United States Court of Appeals for the Fifth Circuit reversed and remanded a district court order dismissing FCPA and money laundering charges against Daisy Rafoi-Bleuler and Paulo Casquireo-Murta, two employees of Swiss wealth management companies who allegedly helped several individuals launder bribes to officials of Venezuela’s national oil company, Petróleos de Venezuela, S.A. (PDVSA), by opening offshore bank accounts and taking other steps designed to conceal the nature of the bribe payments.
Shifting Compliance Strategies in Financial Services for 2023
As regulatory scrutiny on digital assets increased globally over the last 12 months, so did compliance expectations for firms transacting in digital assets.
While financial service organizations have broadly implemented digital technology and AI solutions, 2023 may see a shift in focus for compliance officers away from internal use to the outsourcing of development and collaboration to third-party providers.
Considering the progress of science in various fields, especially in the field of artificial intelligence and adaptation, in 2023, we tried to provide better services to our customers by updating the system and accompanying it.
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