Welcome back to the podcast, bribes, swindle, or steel. I'm Alexandra Rocky. Today we're talking about one of my favorite subjects, the use by companies of third parties as a part of the company's marketing and sales strategy. I don't mean the usual topic of selection and due

diligence and red flags, but the overarching theme we often hear that their use is somehow

unconscionable because so many bribery scandals involve misconduct by third parties.

My guest today is Mike Ward. I saw a great piece on this subject by Mike recently and

reached out. Mike has just joined the San Francisco office of Vincent and Elkins, but prior to that, Mike held senior compliance roles at four major multinationals. They were all trace members, so I got to know Mike well. And then most recently, he was the chief compliance officer at Juniper Networks, where he shepherded that company through an FCPA investigation.

Mike is also a former assistant U.S. attorney, which gives him a great prosecutorial perspective.

Mike, it's great to speak with you. Thank you for joining me.

Well, thank you for the invitation on the kind introduction. I've already teed this up, but briefly.

Bribery enforcement actions often involve misconduct by third parties.

We know this. We hear it a lot. The number cited is usually more than 90 percent, depending on how

you count. It's high, no question. But what we don't hear in those cases is how often the third party

colluded with someone inside the company to pull off the scheme, or perhaps paid a bribe at the request of someone

inside the company. I would imagine that number is pretty close to 100%. So we have this narrative

that third parties, resellers, distributors, agents are inherently risky and bad, and we don't

hear the other side of the calculation. So Mike, why don't you take us through this in a more

methodical way? Why do companies partner with third parties? I think there are multiple reasons

for every industry, but there's some kind of universal ones. The world is a large, complex place,

a single OEM or company like in the space that I've worked in more recently

than tech, in order to project your product, your services across the globe into so many

different types of end users, there's no way any one company, even the largest companies,

can scale and handle that kind of complexity. The notion of the middleman often gets beaten up in even common phraseology like, let's take out or eliminate the middleman.

There are huge companies that provide incredible pro-competitive value to just kind of being that middleware that takes a product here and makes it available for us as consumers or companies

...