Jay Rosen discusses the various ways regulators at all levels – federal, state and local – use monitors, as well as how monitors can be used outside the regulatory context in areas as diverse as M&As, business ventures, IP and licensing.
Most compliance practitioners are aware of the role monitors play in the Foreign Corrupt Practices Act (FCPA) enforcement arena. However, the use of independent monitors is much broader than simply in criminal or civil enforcement actions involving a deferred prosecution agreement, nonprosecution agreement, corporate integrity agreement or other form of resolution.
Federal agencies use monitors for a wide variety of roles to ensure compliance with agreements.
Government Extending its Reach
At its most basic level, an independent monitor is a way for the government to extend its reach, both in terms of lengthening out the time of true government oversight and through many of the techniques we discussed in last week’s blog: focus group meetings, review documents, talking to senior and middle management. It is a very cost-effective way for federal, state and even local governments to extend out their reach.
This cost-effectiveness is driven home by the fact that the cost is not borne by the governmental entity or the regulators, but rather by the entity being regulated.
