FCPA Compliance and Ethics Blog

October 29, 2012

How to Handle a Global Multi-Lingual Investigation

Ed. Note-I recently visited with my colleague (and recovering screen writer) Jay Rosen about some of the complexities involved in a global FCPA/Bribery Act investigation where one or more foreign languages is involved. Jay was kind enough to walk me through his thoughts on best practices for such a task. I was so impressed that I asked him if he could spell some of these out in a Guest Post, which he graciously agreed to do. This is his Guest Post.

Global investigation

Let’s take a look at a hypothetical multilingual investigation. Our client FIBLA, a pharmaceutical company, sells its products globally and has potential FCPA issues in France, Italy, Brazil (Portuguese) and Latin America (Spanish). They have engaged a global forensics firm to identify custodians and image hard drives as part of the initial collection effort. The audit committee has hired outside counsel to run the investigation and each organization hits the ground running. There’s only one problem: No one has contemplated how to handle the foreign language componentof this investigation.

As the first forensics team steps off the tarmac in Sao Paolo and speeds to FIBLA’s headquarters to begin collecting documents, they should be considering a key question regarding the foreign language data they will uncover:

  1. What do they need to know before they walk through that door?

The answers to this question could vary depending on one’s role in the investigation–forensics company or outside counsel. I would like to focus on the best practices for managing the foreign language portion of this type of case. Though each foreign language matter possesses its own unique set of challenges, the common denominator is: “What is the most cost effective way to match the proper translation solution with the needs of the case?

Many clients consider translation to be something they can handle in-house because:

  • “Rebecca down the hall speaks Spanish.”
  • “I’ll use Google Translate.”
  • “The associates in our Mexico City office can handle this.”
  • “The forensic accountants in Paris or the document reviewers in Ecuador can translate this information on the fly.”

In certain circumstances, all of these options have some validity, but for a mission critical investigation where accuracy and deadlines are paramount, these are not the best choices.

Language filtering solutions
Multi-lingual FCPA investigations demand a different level of sophistication and execution. Faced with a large volume of foreign language documents and pending deadlines, the team should leverage language filtering solutions that will bring order to the document chaos while reducing the time and cost involved in discovering the content of documents that are key to the investigation. In other words, separate the wheat from the chaff. These solutions, offered by most language solutions providers (LSPs), include both technology and human based translation tools.

Tool #1: Language identification
A language identification tool analyzes a document and reports the language distribution as either an absolute value (e.g., English, Italian, Mixed, or unknown) or can deliver a percentage break down (e.g., 5% French, 95% English; 10% Portuguese, 10% Italian, 80% Spanish).

On a document level, the resultant breakdown allows for granular workflows. On a case level, this knowledge determines the appropriate allocation of native speaking document reviewers needed and the most efficient and cost effective use of these resources.

Tool #2: Foreign language key words
Key words are identified by the lawyers who then have them translated to allow searching within foreign language text. Such a translation must account for the nuances inherent in another language. For example, 20 English terms can easy become 100 foreign language terms. Filtering native language documents against key foreign language terms will increase the accuracy of the review and improve the results of responsive searches. A couple hundred dollars invested here can save thousands in attorney review costs.

Tool #3: Machine translation
Machine translation provides a “gisted” understanding of large volumes of electronic documents and can allow English speakers to more easily identify those that are relevant. Thousands of pages can be translated in a fraction of the time required by traditional methods which, in turn, yield significant time and cost savings. Machine translation quality typically correlates to the quality of the source document and how well it can be read by optical character recognition (OCR). If viable, this process is 1/100th the cost of human translations.

Technology-based filtering solutions help the internal team to efficiently identify “hot” documents while eliminating those with no relevance to the investigation. This ensures that only those documents that are absolutely necessary will be submitted for human translation. For example, in a recent Turkish FCPA matter, Merrill Brink’s filtering tools reduced the number of translated documents to 3,000 out of an initial universe of 1,000,000.

By leveraging these language technology solutions once the initial data has been collected, the review team is able to reduce the amount of potentially discoverable information that bilingual reviewers need to consider. Combining an LSP’s language based technology solutions with sophisticated tools offered by most eDiscovery platforms will help to identify duplicate and forwarded emails, streamline the review process, and result in a reduction of crucial time, resources, and costs.

Here Jay slipped back into his prior life as a screen writer to explain the following:

FADE IN:

When we last saw our heroes, a crack forensics team, “Boots on the Ground,” thudded onto the tarmac in Sao Paolo, piled into waiting black SUVs with tinted glass and sped to FIBLA’s headquarters to begin collecting documents.  In a blistering high tech MONTAGE, we breathlessly see them collect, process and load the data into an eDiscovery hosting tool.  As the grunts fall back to secure the beachhead, the calvary, “Outside Counsel,” arrives in SUPER SLO-MO Quentin Tarantino blaze of slip-on loafers, broad cloth shirts and rep ties to begin a document review using contract attorneys…

FADE OUT:

Usually the law firm will perform a first- and second-level review, confirming which documents are “responsive” or “hot” and only then will they consider how to translate the documents. Some of the same ideas from Part 1(Rebecca down the hall, Google Translate, The Mexico City associates, and Forensic accounts in Paris) may be proposed as viable solutions. Again, I would caution that it is far better to engage an LSP that is well versed in the translation intricacies of these internal and external investigations.

Bilingual review and translations involve different skill sets and different costs are associated with each service. For this reason, it is best to separate the two in most cases. Industry pricing for on-site review in the U.S. varies from $70 to $110 per hour, depending on the region. In many cases, these reviewers are bilingual attorneys who are trained to identify or translate information that is pertinent to the case.

Translation is typically charged by the word and completed off-site by linguists who are trained to understand terminology and context, and to ensure the results are accurately rendered from the source to the target language. The price per word will vary by language, subject matter, turnaround time, and volume.

Although in some cases it may be deemed expedient to have the bilingual reviewers perform the translation, this will usually result in a higher cost and slower delivery. The optimal solution would be to have the reviewers identify responsive documents and feed them to the off-site translators. This way, outside counsel will have a continuous workflow that will save precious time, match resources with their respective area of expertise, and manage the company’s costs.

Human translation solutions
Most LSPs will offer at least two or three levels of human translations, each of which plays a role in the filtering process we have discussed here.

Summary translations
If machine translation has not proved feasible (due to the quality of the source documents or the language not being an option for this solution), the next choice for filtering documents would be summary translations. This often takes the form of a few sentences or perhaps some coded fields which allow for a better understanding of the content of the document. Armed with this intelligence, a decision can be made about which documents need a more complete human translation. This is also an effective way to cull large volumes of documents and identify those which require full human translation.

Basic translations
Documents are translated by a native language linguist and reviewed by a project manager. Although not as polished as a full translations, basic translations enable outside counsel to ascertain the complete content of a document. These documents are used by the investigation team for internal use.

Full translations
Full service translation starts with the basic translation process as described above, but adds a formal editing stage by a second linguist and includes a thorough quality check. Documents that have gone through a full translation processes may be certified upon request and a Certificate of Accuracy (COA) will be issued and notarized. This certification is often required for documents being presented to governmental entities such as the courts, Department of Justice, or the Securities and Exchange Commission. Both technology and human translation solutions should be utilized to reduce the amount of data that requires full translation.

By knowing this information in advance, the team speeding to FIBLA’s headquarters can concentrate on the job at hand—securing the location, collecting the data, and interviewing employees. After all the information is collected and an LSP is engaged, outside counsel can begin to leverage the above mentioned tools. Filtering processes are commenced to match appropriate translation solutions to each step of the investigation, contain the costs of human translations, and most importantly, produce the highest quality translations from professional linguists.

Jay Rosen is a Vice President, Language Solutions at Merrill Brink International, based in Los Angeles, where he advises corporations, forensic professionals and outside counsel on translation solutions for Cross-border and FCPA investigations, Compliance, Ethics, Code of Conduct and eLearning projects, M&A Due Diligence and Patent and IP matters. He can be reached via email at jay.rosen@merrillcorp.com and via phone at 310-729-6746.

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Please join Martha Duncan, CCO at Parametric Technology Corporation, Eddie Cogan, CEO of Catelas Software and myself for a webinar on Wednesday, October 31 on “How Much Risk are You On-Boarding with Each New or Acquisition?” For details and registration, click here.

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This publication contains general information only and is based on the experiences and research of the author. The author is not, by means of this publication, rendering business, legal advice, or other professional advice or services. This publication is not a substitute for such legal advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified legal advisor. The author, his affiliates, and related entities shall not be responsible for any loss sustained by any person or entity that relies on this publication. 
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10 Questions to Better Management Practices in a FCPA Program

One of the things that I sorely lacked when I worked in-house was any guidance on management practices towards the implementation of either legal or compliance initiatives. Most legal and compliance departments do not train their attorneys or compliance practitioners on management practices for compliance program implementation, enhancements or upgrades after a risk assessment. I was therefore very intrigued when I came across an article in the November issue of the Harvard Business Review, entitled “Does Management Really Work?” by Nicholas Brown, Raffaella Sadun and John Van Reenen. I found the article very useful because it gave succinct advice about what a business can do to improve its management practices and determined that this advice can be applicable to a compliance program.

The authors tested three essential practices which they believe can address even the most complex global problems. The three principles which they believe “are generally considered to be the essentials of good management” are:

  • Targets: Does the organization support long term goals with tough but achievable short-term performance benchmarks?
  • Incentives: Does the organization reward high performers with promotions and bonuses while retraining or moving underperformers?
  • Monitoring: Does the organization rigorously collect and analyze performance data to identify opportunities for improvement?

You might read these and immediately think about Paul McNulty’s (Three) Maxims. I, however, believe that these three management practices can provide some assistance beyond McNulty’s queries. In the article the authors research showed that by the use of these three techniques businesses could not only set parameters but also measure on them, generally had more and better productivity and overall better financial health.

From the compliance perspective how can one use these three relatively straight forward techniques? Interestingly the authors revealed some of the questions used in interviews with over 8,000 manufacturers who were interviewed in this project. I have selected 10 questions which you might want to put use as a starting point for managing your compliance initiatives going forward as I believe that they are very good questions to use in formulating a plan for compliance program implementation or upgrade. I would challenge you to think about some of the answers to these questions in the context of your compliance program.

  1. Interconnectedness of Targets – How are compliance goals cascaded down to individual workers? Everyone recognizes the importance of ‘tone-at-the-top’ as it is enshrined in the US Federal Sentencing Guidelines, the Department of Justice’s (DOJ) minimum best practices compliance regime and the UK Bribery Act’s Six Principles of an Adequate Procedures compliance program. However, as many commentators now recognize, it is also tone in the middle and at the bottom, which may equally matter. So how do you ascertain and ensure that top management’s message gets cascaded down into your organization?
  2. Clarity and Comparability of Goals – Does anyone complain that your compliance targets are too complex? Certainly the initial role out of a compliance program can be quite a large undertaking. Perhaps another approach might be to focus on high risk areas and remediate them by rolling out initiatives to manage those risks first and then move to other areas. Many companies have reviewed and remedied the third party sales side of their business but are only now looking at the Supply Chain or Procurement side of the equation. If you work on one such problem at a time, it can help move the overall process forward in a more orderly fashion.
  3. Consequence Management – How do you deal with repeated compliance failures in a specific business segment or compliance program area? This is certainly one question that you would want to consider carefully. Do you have problems with one business unit or one geographic area from the compliance perspective? Are gifts in China, for example, an ongoing issue for your company? What about travel and entertainment? Areas that show up again and again will merit more focused attention.
  4. Instilling a Mind-Set – How do senior managers show that attracting and developing talent who will engage in ethical business conduct is a top priority? Here you should consider bringing in your Human Resources Department for not only assistance but their expertise. If top management will make a commitment to this, you should work to create the appropriate mind-set of doing business the right way throughout your organization.
  5. Removing Poor Performers – How long is compliance underperforming tolerated? In many ways, this question is the flip side of number 4 above. I think that many companies would clearly say that they will discipline, up to and including discharge, any employee who engages in practices which violates the Foreign Corrupt Practices Act (FCPA) or UK Bribery Act. But this question drills deeper and forces a more rigorous analysis on not just FCPA failures by employees but poor ethical choices which may be less than full FCPA violations.
  6. Unique Employee Value Proposition – What makes it distinctive to work at your company? More pointedly, how can your compliance challenges be turned into business leadership opportunities? Ethisphere annually shows that its top list of the Most Ethical Companies out performs the Standard & Poor (S&P) 500. If you can turn the distinctiveness of what your company does into a compliance plus in the marketplace, it could well make your business more profitable.
  7. Continuous Improvement – How do compliance programs that are not working typically get exposed and fixed? There is a difference between auditing and monitoring. Monitoring is a commitment to reviewing and detecting compliance programs in real time and then reacting quickly to remediate them. A primary goal of monitoring is to identify and address gaps in your program on a regular and consistent basis. Auditing is a more limited review that targets a specific business component, region or market sector during a particular timeframe in order to uncover and/or evaluate certain risks, particularly as seen in financial records. A robust program should include separate functions for auditing and monitoring. While unique in protocol, the two functions are related and can operate in tandem. Monitoring activities can sometimes lead to audits.  For example, if you notice a trend of suspicious payments in recent monitoring reports from a country in the Far East, it may be time to conduct an audit of those operations to further investigate the issue.
  8. Performance Tracking – What key compliance indicators do you use for compliance tracking? Here you need to look at the metrics which you have developed. A good starting point can be with your hotline or helpline. What can you determine from the calls or reports which come in through these systems? What if you have not had any reports for several years, what should that be telling you about your communication to your employee base? Or does it mean that people have not been properly and effectively trained that a hotline or helpline exists and is available for their use or, more ominously, are afraid to make any reports for fear of retaliation or even losing their jobs? This is certainly something you should take a good look into, whichever way the metrics are going for your company.
  9. Performance Dialogue – For a given compliance problem, how do you identify the root cause?  If you do not know what the cause of a problem is, you cannot successfully work towards remedying that problem. This does not simply mean firing any persons involved in a potential FCPA violation. You need to dig down and found out what allowed this issue to arise. I once heard that the difference between Japanese and American post-incident investigations is that in the US there is an attempt to assess blame, conversely in Japan there is an attempt to find a solution to the problem. This is the approach that I believe compliance practitioners should take, to try and find a solution by determining the root cause of a compliance failure.
  10. Retaining – What are you doing to retain your top employees from the compliance perspective? This is not a question that is typically asked in the compliance department. But one thing you can look at is what your company is doing to retain, promote and take to senior management those employees who do business in an ethical manner and in compliance with your company Code of Conduct.

I found the article to be very useful when applied to the compliance practitioner by not only using the triumvirate of targets, incentives and monitoring as a management practice but also the questions that the authors posed in the context of your company’s own compliance program. We continually face the challenge of keeping up with the ever evolving compliance best practices with little or no budget increase. I found that this article had points which you can ask yourself, and of your compliance program, which can facilitate a robust discussion that can highlight areas for improvement.

This publication contains general information only and is based on the experiences and research of the author. The author is not, by means of this publication, rendering business, legal advice, or other professional advice or services. This publication is not a substitute for such legal advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified legal advisor. The author, his affiliates, and related entities shall not be responsible for any loss sustained by any person or entity that relies on this publication. The Author gives his permission to link, post, distribute, or reference this article for any lawful purpose, provided attribution is made to the author. The author can be reached at tfox@tfoxlaw.com.

© Thomas R. Fox, 2012

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