Aziz Rahman of Rahman Ravelli
Aziz Rahman, of award-winning business crime solicitors Rahman Ravelli, outlines the benefits of knowing how and when to co-operate, negotiate with or challenge the Serious Fraud Office.
As an enforcement agency, the Serious Fraud Office (SFO) has a unique range of powers and a particular way of working. This makes it especially important that you know exactly how to conduct dealings with it when it takes an interest in you or your business.
On a number of occasions, the SFO has made it clear that, while it wants greater co-operation with the business world, it expects co-operation to mean more than merely going through the motions in an attempt to be treated leniently. Yet while this may seem demanding, the right approach can certainly lead to those being investigated avoiding prosecution.
Now, the SFO has published a five-page document, "corporate co-operation guidance", which defines its view of co-operation as "providing assistance to the SFO that goes above and beyond what the law requires".
This new guidance details issues that companies should consider when preserving material and giving it to the SFO to assist with an investigation. It gives specific advice regarding digital evidence, hard copies and physical evidence, financial records and analysis, industry information and individuals.
The guidance also appears to take the view that a company should alert the SFO to aspects of an investigation that the company cannot gain access to and identify possible witnesses. It adds that making witnesses available for interview and providing a report of any internal investigation are also evidence of co-operation.
Significantly, the guidance also makes demands on companies that claim the SFO is not allowed access to certain documents as they are legally privileged. And it warns that not even “full, robust co-operation’’ will guarantee a particular outcome.
The SFO’s view on co-operation, it seems, is an exacting one. Which is why a company or individual investigated by the SFO must know precisely how to react.
Under Section 2 of the Criminal Justice Act 1987 – the legislation that created the SFO – the SFO has the power to compel any individual or organisation to provide it with information or documents that it believes are relevant to an investigation. Since 2014, it can also offer a deferred prosecution agreement (DPA), whereby a prosecution is suspended if the accused admits the wrongdoing and agrees to meet certain conditions.
In short, the SFO has a lot of power and can exercise a large degree of discretion. This makes it imperative that any subject of an SFO investigation is aware of the level of co-operation it expects. Yet it is also important to know when and how to challenge or negotiate with the SFO.
Challenge or negotiation
Legal challenges to the SFO’s obtaining of search warrants, the way searches are carried out and what material is seized as a result need to be made as early as possible. The SFO can also be challenged about its conduct and the information and material it intends to use as evidence.
Section 21 of the Police and Criminal Evidence Act (PACE) gives people access to their material that the SFO has seized while the Attorney General’s Guidance on Disclosure (December 2013) laid down guidelines on dealing with the seizure and search of digital material. Both can be utilised to prevent the SFO putting an investigated company or individual in an unfair position.
Challenges can, if managed properly, bring results. The SFO does make mistakes. The most notable example was when it had to pay £4.5m to the brothers Robert and Vincent Tchenguiz after it was shown that the SFO had not checked information it presented to court when applying for search warrants that led to premises being raided and arrests made.
Yet knowing when to negotiate can also be the way to gain the best conclusion to an SFO investigation. The SFO’s current director, Lisa Osofsky, has talked of wanting investigations completed quicker and of the value of making a deal. The right negotiating stance can yield a favourable result.
But this brings us back to that word: co-operation. Negotiation can only be of value if you know what wrongdoing has been committed - and that knowledge will have to be shared with the SFO if you are to be viewed by it as co-operative and worthy of lenient treatment.
Whatever the circumstances that have attracted – or are likely to attract – SFO interest, care has to be taken to find out exactly what has happened and how it has happened. This is best done by conducting a thorough internal investigation. Its findings can then determine the best way to approach and/or deal with the SFO. As although the SFO welcomes co-operation, it has to be co-operation on its terms.
Aziz Rahman is founder of Rahman Ravelli; a top-ranked business crime law firm in national and international legal guides.
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