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Compliance and Confidentiality Agreements Clash

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June 24, 2022

Compliance requires constant modification of policies based on honest feedback. Confidentiality agreements are all about keeping your mouth shut. Ipso facto, confidentiality agreements obstruct compliance, says Richard L. Cassin. He lists a number of well-known instances when non-disclosure and confidentiality agreements were misused, e.g.: BlackRock Inc. forced more than a thousand exiting employees to waive their ability to obtain whistleblower awards; SandRidge Energy Inc. put language in a whistleblower’s separation agreement that prohibited participation in government investigations or disclosing information potentially harmful or embarrassing to the company; Anheuser-Busch InBev used a separation agreement to stop an employee from continuing to voluntarily communicate with the SEC about potential FCPA violations. He suggests that compliance professionals review all non-disclosure and non-disparagement provisions that employees (especially those on the way out the door) are asked to sign, and determine whether they might impede the free flow of honest and authentic feedback.

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