Corporate Compliance, Ltd.
  1. Q: Only large corporations need a compliance program under the Federal Sentencing Guidelines.

    The ANSWER is FALSE. A larger organization will need a more extensive and formal program,however, a smaller organization will also need a compliance program that will have to take into consideration its prior history, thecomplexities of it's business and the propensity for the industry towhich it longs to have been convicted of criminal offenses.

  2. Q: A non-profit organization, such as non-profit hospital, needs a compliance program.

    The ANSWER is TRUE. The term organization for the purpose of the Sentencing Guidelines means "a person other than an individual." Title 18 U.S.C. § 18. The term includes corporations, partnerships, associations, joint stock companies, unions, trusts, pension funds, unincorporated organizations, governments and political subdivisions thereof, and non-profit organizations.

  3. Q: Banks are exempt from a corporate compliance program under the Sentencing Guidelines because they must be audited by a CPA firm, every year, by law.

    The ANSWER is FALSE. The annual audit conducted by a CPA firm is designed to ensure that the books and records of the organization have been maintained in accordance with generally accepted accounting principles. The CPA firm will normally ensure that internal controls are in place to support their opinion on the firms financial condition. The audit that the CPA firm conducts does not address the issue of whether the firm has in place an effective compliance program that prevents and detects criminal activity.

  4. Q: If an employee commits a criminal act his immediate boss can be held responsible but not other members of management or members of the board of directors.

    The ANSWER is FALSE. The doctrine of respondeat superior refers to the situation whereby an organization is victimized by their employees. When this is the case, and the employee is acting within the scope of their employment, for the benefit of the organization, the criminal intent and knowledge of employees can be attributed to the organizations to which they work.

  5. Q: Only individuals convicted of criminal acts can be placed on probation, an organization can be subjected to fines and other monetary penalties.

    The ANSWER is FALSE. Companies as well as individuals can be placed on probation under the Guidelines. Part D of the Federal Sentencing Guidelines for Organizations, addresses the length of probation, conditions of probation, and violations of probation conditions for companies. In most cases some sort of intrusive oversight is imposed.

Email Us
Corporate Compliance, Ltd.
152 Kentview Drive
Carmel, NY 10512
Telephone: (845)225-6822
Fax: (845)225-3930

to the
Main Page

Web Site Designed by The Village Web SmithsTM
Bringing the Power of the World Wide Web to Your Small Business.

Text copyright 1997 by William J. Richmond and Michele C. Petitt. Graphics copyright March 1997 by Michele C. Petitt and the Village Web Smiths. The Fraud Detector is a Trademark of Corporate Compliance, Ltd. The Anvil and Keyboard Logo is a Trademark of The Village Web Smiths.
The contents of this web site are provided for informational purposes only and are not intended to constitute legal advice. Please consult a professional for assistance with your particular situation.

This site has been visited times since March 17, 1997.