On a basic level, it's about prevention, detection, collaboration, and striving to achieve enforcement of the organizations system of policies and procedures developed to assure compliance with and conformity to application laws governing the organization.

An effective compliance program is an ongoing process with support from the top down to support all in conducting business in an ethical way.

Businesses in the medical, financial, and insurance sectors most certainly should have compliance programs with many federal, state, and local regulations to observe and incorporate. The fundamental drive of the compliance program is to safeguard the organization's legal responsibiity to abide by applicable laws and regulations.

With that in mind, it's easy to see that ANY business and organization is well served by having one. Stepping back from legal protection and defenses, having a solid program helps instill trust between the organization and its employees, financial stakeholders, and the community.

Nonprofits (501.c.3) and not for profits (501.c.6) should also have an effective compliance program to maintain their 501 c status and build trust and confidence with the stakeholders they serve.

An unfortunate reality of why compliance programs are essential rests in the fact that people do bad things, whether intentional or unintentional. Effective compliance programs can certainly aid in reducing the number of errors by educating employees in advance, but the biggest value is in protecting the organization from financial penalties, court imposed sentences, government imposed penalties or protections and reducing the threat of qui tam (whistle-blower) lawsuits.

The Office of the Inspector General (OIG) provides the following list as reasons to have a compliance program:

1. Demonstrates to the community at large that there is a strong commitment to honesty and responsible corporate citizenship.

2. Reinforces employees' innate sense of right and wrong

3. Helps fulfill legal duties to government and private payors

4. Cost effective, especially when compared to disruption and expenses incurred in defending against fraud or some other claim.

5. Provides a more accurate view of employee and contractor behavior relating to fraud and abuse.

6. Quality of care to patients (or quality of product or services rendered if not in medical field) is enhanced by an effective compliance program.

7. Provides proceures to promptly correct misconduct

8. Can mitigate santions imposed by the government

9. Preferable to waiting for a Corporate Integrity Agreement (CIA) to be imposed

10. Can protect corporate directors from personal liability - WHAT??? Oh yes, many individuals serving on a board of directors have no idea that they are exposing themselves to personal liability as a result of their service.

The fiduciary duties of corporate directors require they be kept informed where operations of the company are concerned.

1. Develop written Code of Conduct / Policies and procedures that are reasonably capable of reducing the prospect of criminal activity

2. Assign oversight of compliance to a specific individual who resides at a high level within the organization

3. Use due care not to delegate substantial discretionary authority to individuals whom the organization knew, or should have known, had propensity to engage in illegal activities

4. Take steps to effectively communicate compliance policies and procedures to all employees and other agents.

5. Take reasonable steps to achieve compliance with standards by utiizing monitoring and auditng systems that are reasonably designed to detect criminal conduct on the part of its employees or agents and have in place means by which misconduct can be reported.

6. Consistently enforce the established standards.

7. Upon detecting an offense, take all reasonable steps to respond appropriately to the offense and evaluate steps needed to prevent similar offenses in the future.