Do you track what’s the normal cost?

“Venezuela Alleges Fraud in $1.3 Billion Oil-Rig Lease,” The Wall Street Journal, March 16, 2017 A10.  “Officials at PdVSA [the state oil company in Venezuela] were accused of embezzlement by paying inflated fees.”

How do you track whether the company is paying inflated fees to companies owned by Saudi princes, with a no-bid contract to an industry newcomer?  You do track that, don’t you?  As a director you would want to make sure that people weren’t paying too much for service contracts.  Why would the state oil company pay inflated rates?  Aren’t these bribes going the ‘wrong’ way?  Or was it just waste and incompetence?  The difference is only $250,000 a day for seven years.

Do you consider the information governance aspects of the FCPA, beyond the books and records?  It is good that the government checks.

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Filed under Board, Compliance, Compliance Verification, Controls, Corporation, Definition, Directors, Duty, Employees, Governance, Government, Information, Internal controls, Oversight, Oversight, Protect assets, Risk Assessment, Risk assessment

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