Compliance iStock_000033418316SmallThe District Court of Munich (Germany) has sentenced a former board member of a German company to pay EUR 15 million to his former employer because he has failed to install a functioning compliance management system (LG München I, judgment v. 12.10.2013 – 5 HKO 1387/10).

The former board member was made indirectly responsible that he had ignored the development of a company “slush funds” during his tenure.  The slush fund was used to bribe foreign officials.  The former board member had claimed that he had no knowledge of the “slush fund” system, nor about the illegal payments.  The Munich court did not buy his argument stating that it is the responsibility of a board member to assure that employees are in compliance with regulations.

Source:  Creditreform Compliance