This post is a follow-up to our four-part series, Hook, Line, and Sinker, about Mozambique’s ill-fated attempt to launch a commercial tuna fishing industry, and the corrupt firms that pushed the effort and helped cause the country to lose more than $2 billion.
Recently, Mozambique largely prevailed in its claims against the Privinvest Group, the shipbuilder at the center of the doomed transactions known as the Tuna Bonds. A UK court concluded that Privinvest paid bribes to win related contracts, and awarded a net amount of roughly $1.9 billion to the country.
Privinvest has said it will appeal the ruling.
Up until the decision, Mozambique had been reaching out-of-court settlements with relevant parties, including Credit Suisse and VTB Capital Plc. – both of which provided or arranged billions in loans to build and support a commercial tuna fishing industry in the country.
While the settlements allowed the banks to keep many details out of public view, the court judgement offers a much deeper look at relevant facts. In doing so, the case provides some practical lessons for compliance professionals.
Don’t cut corners
The court decision reveals why the July 2013 Mozambique Fishing Feasibility Study, which was used to justify the projects that the loans would back, was so rife with problems – it was completely made up. Indeed, a Credit Suisse banker created the document, while fully aware of its unrealistic assumptions (quipping, for instance, that they “will only catch yellow fin and sell to Nobu!”).
Even if compliance officers felt that they lacked the technical knowledge to question the substance of the feasibility study, answers to more general questions – Who wrote the study? What are their qualifications? What other work have they done? – might have prompted further skepticism.
It’s not all bad
When U.S. and U.K. regulators resolved their enforcement actions against Credit Suisse in 2021, they (and media reports about the cases) pounced on a due diligence report that called the head of Privinvest a “master of kickbacks.”
Viewed in isolation, the description can appear damning. But due diligence reports often include varying degrees of negative findings, and a company that shies away from any hint of dirt may soon find itself short of options.
The judge in this case provides some reassurance for companies that come across similar red flags: “There was reference at trial to his having a poor reputation for business methods and integrity. I did not find that persuasive where it was based on unattributed rumour rather than evidence.”
In other words, while such warnings are certainly meaningful, companies are not expected to pull the plug whenever they appear. Rather, they should assess that red flag against other factors – in this case, it was those other factors that were too easily disregarded.
FCPA Compliance Consultant, TRACE
Creating and maintaining a compliance training library can be an arduous task whether you have a team of one or one hundred! It’s not always easy to obtain resources in support of compliance efforts (a conversation for another day!) whether that’s human resources, access to software or budget. But, all hope is not lost! You CAN effectively build out a compliance training library even if you only have one course to start. Furthermore, breaking up a longer e-learning course into microlearning modules can greatly enhance learner engagement and knowledge retention.
Here are a few best practices you can employ to truncate and restructure one full length training into microlearning:
1. Identify Learning Objectives: Begin by revisiting the learning objectives identified for the original full length course. These objectives will guide the creation of your microlearning modules.
2. Chunking Content: Divide the course content into smaller, manageable sections. Each section should ideally cover one specific topic or concept that tracks back to your learning objectives.
3. Focus on Single Learning Points: Each microlearning module should focus on a single learning point or objective. Sticking to one point/objective will ensure the content remains focused and thus prevents cognitive overload.
4. Keep it Short: Aim for short durations, typically between 5 to 15 minutes per microlearning module. This length is optimal for maintaining learner engagement and attention.
5. Use Multimedia Elements: Incorporate a variety of multimedia elements such as videos, interactive quizzes, infographics, and simulations to make the content more engaging and cater to different learning styles.
6. Utilize a Learning Path: If deploying all at once, be sure to arrange microlearning modules in a logical sequence to ensure that they build upon each other progressively. This helps learners grasp complex concepts more effectively.
7. Promote Interactivity: Include interactive elements within each module to encourage active participation and reinforce learning. This could include quizzes, scenarios, discussions, or reflective exercises.
8. Assessment and Feedback: Integrate assessments or quizzes at the end of each microlearning module to gauge learner comprehension. Provide immediate feedback to reinforce learning outcomes.
9. Mobile Compatibility: Ensure all microlearning modules are accessible via multiple devices, including smartphones and tablets, to accommodate learners who prefer mobile learning.
10. Encourage Application: Include practical examples, case studies, or real-life scenarios within each module to illustrate how the learning can be applied in the real world.
By following these best practices, you can effectively break up a long eLearning course into microlearning modules that are engaging, digestible, and conducive to effective learning outcomes.
Manager, Compliance eLearning Development, TRACE
This post is part of our “Ask an Expert” series where we take questions submitted by readers and ask an expert in the compliance field to provide insight. If you have a question you would like answered, please submit here. |
As Spain celebrates its success in the European Football Championship, its most iconic club, FC Barcelona, is in the spotlight for the wrong reasons. In May, an appellate court in the country struck down a bribery charge against the sports association. The charge was leveled in connection with news that the team’s former presidents had paid $7.7 million to a vice-president of Spanish football’s refereeing committee, José María Enríquez Negreira. The team, along with Negreira and the ex-officials, still face charges of corruption, breach of trust, and false business records.
FC Barcelona maintains that the payments, made over the course of eight years, were consulting fees. However, the arrangement raises several red flags for impropriety, including the sheer size of the payments, and that Negreira was involved in assigning referees to matches and evaluating their performance. Moreover, it is not clear exactly what the nature of the consultation was, as top-level referees typically do not engage in consultancy work, and any consulting agreement was strictly verbal.
Xavier Estrada Fernández, a top-level goalie, has filed a criminal lawsuit against Negreira, alleging sporting fraud. According to Fernández, the system that Negreira used to assign referees to international matches employed a corrective index which has been dubbed the “corruption index” by other retired referees. Fernández alleges Negreira controlled the rating system of the referees to favor those close to him, meaning those willing to favor FC Barcelona as well. He claims that since he did not go along with the plan, he was rated poorly on that system.
However, there is no evidence that Negreira himself paid referees to influence matches or otherwise interfered with their officiating, and the subjective nature of many calls makes it hard to argue what, specifically, may have unfairly benefited FC Barcelona.
Because bribery is secretive by nature, its elements have always been notoriously hard to prove in court. This is driving the outcry over the U.S. Supreme Court’s decision last month in Snyder v. U.S., which interpreted a government ethics law to allow an Indiana mayor to accept a $13,000 payment from a city contractor on the basis that it was a gratuity, not a bribe.
A bribe entails giving or offering a thing of value in exchange for something that the recipient might not normally do. In the case of a gratuity, there is no need to demonstrate what the intent or effect of the payment is, just that it has some connection to the recipient’s duties. Gratuities can be given before the event in question. This means bribery is much harder to prove because it is difficult to prove intent. As a result, fewer bribery charges are brought.
Although there are some serious red flags with Barca’s case, there is no explicit “smoking gun” linking the purpose of the payment to any actions Negreira took. Barca has not shown what Negreira’s consultancy contract was for and has only said that Negreira gave insider knowledge about some referees. Notwithstanding that this seems to resemble improperly buying confidential information, it still does not rise to the level of manipulating refereeing outcomes.
Even if the elements of bribery are not alleged, the payments between the former directors and Negreira could still be seen as gratuities because they are clearly in connection with his refereeing role. Although seemingly less severe than bribery, gratuities are still quite problematic. For example, in 2010, a judge in the U.S. landed in hot water after he received multiple bags of popcorn after he dismissed parking tickets given to a delivery driver of a popcorn company. Despite seeming trivial, a gratuity like this could signal to future defendants that they can “buy” a favorable outcome with this judge. Here, it’s quite easy to see how payments totaling $7.7 million can result in favorable treatment.
The charges that FC Barcelona faces are quite severe. Legal and ethics frameworks describe how accepting gratuities is problematic and prohibit doing so because it completely taints the institution. Because of these payments, the past 17 years of games are pulled into question. In fact, the judge has opened a door for all soccer teams that have played against the club during the years under investigation to privately prosecute. As a result, the soccer club Real Madrid is now taking legal action against Barca because these payments signal Barca has had an unfair advantage from 2001 to 2018. If only a goalie could save FC Barcelona from the consequences they are about to face.
J.D. Candidate, The George Washington University Law School, Class of 2026