Lawyers must tackle corruption

October 05, 2010 1:54 PM

Members of the IBA, the OECD, the United Nations and prominent white collar crime lawyers urged the legal profession to take a more proactive role in the fight against corruption yesterday, as a survey revealed an 'amazingly low' level of awareness of anticorruption legislation among the world's lawyers, while almost 80 per cent of Latin American lawyers say they consider corruption to be an issue in the legal profession.

Almost half of the world's lawyers are unaware of anti-corruption conventions
At the IBA meeting in Vancouver, a distinguished panel discussed the findings of a global survey conducted by the IBA with the support of the OECD and the United Nations Office on Drugs and Crime (UNODC).

Lawyers' awareness of the world's anticorruption legal framework is "dismaying"; almost 40 per cent of respondents are simply not aware of any of the conventions that exist. Some 40 per cent don't appreciate the scope of the US Foreign Corrupt Practices Act, while up to 70 per cent said they were unaware of the UK's younger, and further reaching, Bribery Law.

During the IBA session, Colombian lawyer Gonzalo Guzman, based at the IBA in London, explained how the survey seeks to analyse four issues: perception of lawyers about the issue of corruption; the risk of international corruption to the legal profession; the awareness of the legal framework in place to address the problem; and the role of the lawyer in challenging this.

The survey was answered by 642 private practice business lawyers from 95 countries. Latin American respondents were particularly attuned to the presence of corruption in their jurisdictions. Just over 40 per cent said they know members of the legal profession in their country that have engaged in international corrupt activities. Over 50 per cent said they have lost business to lawyers that are prepared to pay government officials on behalf of foreign companies, with real estate, energy and environment, and infrastructure the areas most vulnerable to corrupt activities.

The panel, which included figures from UNODC and KPMG and IBA President Fernando Peláez-Pier urged lawyers to start asking questions – and move from a reactive mode to a proactive mode. Mark Mendelsohn, partner of Paul Weiss Rifkind Wharton & Garrison LLP and formerly of the US Department of Justice (DoJ), said it was a matter of professional obligation and self-interest for lawyers, saying one day a member of the legal profession would be prosecuted for ignoring legislation.

Homer Moyer, an FCPA partner at Miller & Chevalier in Washington, DC, reflected on how lawyers might obstruct the fight on corruption, listing actions that range from the "benign" to "criminal". At the more innocent end of the scale he spoke about lawyers who are unaware of the laws, such as M&A lawyers responding with a "blank stare" to the concept of FCPA due diligence. Moving up he spoke about ill-informed lawyers giving bad advice leading to malpractice suits, and lawyers designing offshore companies because they are cynical about the prohibitions. Worse are lawyers bribing government officials on behalf of clients, and worse still those that bribe judges independently to win legal actions.

Robert Lupone, general counsel of Siemens, outlined the German company's rigorous compliance programme that it implemented following the compliance investigation of its activities that led to a 2008 settlement with German authorities, the DoJ and the US Securities and Exchange Commission. The programme includes a comprehensive vetting of the law firms the company uses across the world. Siemens' in-house lawyers are expected to collect data on a firm's track record in the relevant field and its payment structure, among several other requirements.

Lupone encouraged law firms to alert companies to anything that appears suspicious and said more multinational companies would be implementing such programmes.

Training sessions to raise awareness and responsibility among lawyers in connection to the survey have been launched in Latin America. They began last month in Argentina and Chile, where they were attended by 60 law firms. The next destinations are Mexico, Colombia and Peru. The Latin American sessions will conclude next year in Brazil and Venezuela before the organisers move on to Asia and Eastern Europe.

(Source: Latin Lawyer)

5 October 2010