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The Enron scandal, and "a spate of scandals in its wake," have permanently changed the landscape for government investigations and corporate compliance, Jenner & Block Partner Andrew Weissmann told a SuperConference seminar on Tuesday, May 20, 2008.
"There has been a sea change in what the government expects, and in what corporations need to do to deter criminal and unethical conduct," Mr. Weissmann said at the session on "When the Feds Come Knocking." Weissmann is the former director of the U.S. Department of Justice's Enron Task Force.
These changes, Mr. Weissmann said, "are always in the back of the minds of people like Jodie and Vanessa." With that, Mr. Weissmann introduced his fellow panelists, Jodie L. Kelley, Vice President and Deputy General Counsel of Fannie Mae, and Vanessa Vargas-Land, Vice President and Chief Compliance Officer of Chiquita Brands International.
Ms. Kelley said that Fannie Mae has established a compliance committee that reports directly to the company's board of directors and that the board actively reviews the company's compliance program.
Ms. Kelley, a former Jenner & Block partner, said that when Fannie Mae chooses to bring outside counsel to help respond to a government probe, she looks for a lawyer "who knows the rules upside down and backwards, who has established relationships at the government agency…and whom I can put in front of the company's board.”
Ms. Vargas-Land said she reports to the audit committee of Chiquita's board and keeps the board up-to-date on the status of its compliance with legal and ethical principles.
"I've done a thorough review of our compliance program in many different areas," Ms. Vargas said. "We try to improve the level of education, the level of awareness, company-wide. People ask me, 'How does the compliance program affect me and my job?' So I tell them what the standards are, what the company is expecting of people."
Mr. Weissmann noted that both Fannie Mae and Chiquita have chosen to have their compliance officers report to the board, rather than to the general counsel. He said there are good reasons to employ such a structure.
"If the GC is also the chief compliance officer, there is always going to be the danger that compliance will be viewed solely through the prism of legality, when in fact the concept of compliance is much broader," Mr. Weissmann concluded.