A good compliance culture and an appropriate management style are important but not in themselves sufficient to prevent financial crime. Enforcing disciplinary action against employees who fail to comply is also crucial.
In the event of misconduct, however, the question arises as to how harsh the penalty should be for the affected employee or manager. Often errors are committed without bad intentions and if there is a zero tolerance policy in place, this could lead to the obfuscation of mistakes and breaches (for as long as possible). When assessing the severity, criteria such as seniority, responsibility, intent or recurrence should be considered. What is of the utmost importance is that every individual case is assessed consistently and thoroughly and on the basis of well-researched facts. Staff and line managers must understand the company’s will and power to enforce possible disciplinary actions or sanctions. Applying a zero tolerance culture is not helpful to achieve compliant behavior, but will weaken already established structures and culture.