ORY SLONIM

LAW OFFICE 2008

C

During their usual course of business, company

officers are exposed to a wide range of criminal events

During their usual course of business, company

officers are exposed to a wide range of criminal events

The above risks are not insured in any insurance policy The above risks are not insured in any insurance policy

Strong linkage between criminal risks and its results to the financial aspects

Strong linkage between criminal risks and its results to the financial aspects

Accurate and detailed preparation can minimize the risks

and the exposure to criminal proceedings

Accurate and detailed preparation can minimize the risks

and the exposure to criminal proceedings

ORY SLONIM

LAW OFFICE 2008

C

Criminal riskCriminal riskThe risk of a person or an organizationThe risk of a person or an organization

facing criminal trial as a result offacing criminal trial as a result of

breach of statutory duty/ failurebreach of statutory duty/ failure / /

accident that caused a damage to a accident that caused a damage to a human being, property or human being, property or

environmentenvironment

C ORY SLONIM

LAW OFFICE 2008

Operational riskOperational risk

The risk of loss resulting from The risk of loss resulting from inadequate or failed internal inadequate or failed internal processes, people and systems, processes, people and systems,

or from external eventsor from external events

ORY SLONIM

LAW OFFICE 2008

C

Criminal and operational risks

Conflict of interests

Failure to report to authorities/ inspectors/

management

Industrial accidents, environmental pollution

Frauds and embezzlements

Breach of trust

Money laundering

Breach of secrecy

Lack of internal control

Breach of statutory duty

ORY SLONIM

LAW OFFICE 2008

C

The implications

of the criminal and

the operational risk Criminal sanction–

imprisonment and finesCriminal sanction–

imprisonment and fines

Financial collapseFinancial collapse

Loss of reputationLoss of reputation

Health damages and loss of human life

Health damages and loss of human life

Legal expensesLegal expenses

Loss of clientsLoss of clients

Financial claimsFinancial claims

C ORY SLONIM

LAW OFFICE 2008

Directors and

management responsibilit

y to risk management

Policy

Risk management procedure

Organizational structure

Internal control

Prevent of failures

ORY SLONIM

LAW OFFICE 2008

C

The prosecution The prosecution has to prove its has to prove its case beyond a case beyond a

reasonable doubtreasonable doubt

The burden of proof is shifted

to the defendant to show that he

implemented all the reasonable means in order

to prevent a crime

Some articles of the law require

officers to implement all

the reasonable means in order to

prevent a crime

The burden of proof

Regular criminal trialRegular criminal trialSafety and ecologySafety and ecologyTaxation/securitiesTaxation/securities

ORY SLONIM

LAW OFFICE 2008

C

The burden of proof

Implement all the reasonable means Implement all the reasonable means

ORY SLONIM

LAW OFFICE 2008

C

Risk management

Risk management

Implementation of internal enforcement program

Implementation of internal enforcement program

Supervision, control, instruction and assimilation

Supervision, control, instruction and assimilation

Medium

גורמי סביבה

Mission

המשימה

Methodical event analysis – Methodical event analysis – The 5 ‘m’ modelThe 5 ‘m’ model

Mission Machine

Management

Men

Human factors that contribute to the occurrence of the

event

Environmental aspects that contribute to the

event

Factors that help define the mission and adjust it to the capabilities of the

executing team

Technological aspects including equipment failure

Management aspects related to the event . E.G: procedures, instruction, supervision and control

ORY SLONIM

LAW OFFICE 2008

C

Medium

Mapping the company’s factories

Studying the main producing

procedures in each factory

Mapping the main risk factors in each

factory

Safety hazardsEnvironmental hazards *Dangerous sites.

*Inappropriate equipment.

*Risky machines.

*Sites where accidents occurred before. (the ‘m’ model)

*Waste dump sites.

*Air/land pollution.

*Water contamination.

*Leakage of hazardous materials .

ORY SLONIM

LAW OFFICE 2008

C

Officers and workers

Examination of the organizational and the

administrative structure, in order to reveal risks to

officers – directors, managers and workers

ORY SLONIM

LAW OFFICE 2008

C

Activities of officers and

workers in the company and the supervision and control of their

activities ORY SLONIM

LAW OFFICE 2008

C

ORY SLONIM

LAW OFFICE 2008

Confrontation of the company with potential risks as a result of

breach of statutory duties, Including exposure to criminal

procedures in the country and abroad

Confrontation of the company with potential risks as a result of

breach of statutory duties, Including exposure to criminal

procedures in the country and abroad

Laws related to business licensing

Laws related to business licensing The penal lawThe penal law

Laws related to ecology and environment

Laws related to ecology and environment

Laws related to safety Laws related to safety

C

Companies lawsCompanies laws

OUTSOURCINGExposure to criminal risks

due to contacts with external organizations

ORY SLONIM

LAW OFFICE 2008

C

Risk management Risk management is better is better

than criminal than criminal indictment indictment

ORY SLONIM

LAW OFFICE 2008

C