March 3, 2012
2012 ABA White Collar Crime Conference - Internal Investigations
Internal Investigations in the Age of Voluntary Disclosure
This breakout session, moderated by Keely Rankin (Dechert), concerned internal investigations. A hypothetical, about a telephone message left by a rambling anonymous whistleblower reporting on activities from another country, was used to discuss a variety of issues unique to internal investigations.
Catherine Razzano started the discussion from the perspective of corporate counsel trying to decide whether to investigate and who should do the investigation. She said that you need to do some immediate investigation just to decide how to proceed (e.g., can you do a routine audit; can you trace the call; can local counsel be of assistance). It is important to keep in mind that if it is a public company it has certain reporting obligations. If an HR person does the initial investigation, and the individual is not an attorney, you may lose the privilege. In house counsel brings a certain expertise and outside counsel brings a certain independence. It was emphasized that one needs to take a measured and consistent approach – these investigations cost money.
Angela M. Machala (Scheper Kim & Harris) looked at whether there might be a reason to launch more of an investigation and she also spoke to the advantages and disadvantages of starting with the most culpable employees in setting up interviews. Cultural differences can play a part in how you proceed.
Jonathan Leiken (Jones Day) looked at the problem of what happens when you're reviewing emails and you find more problems. He said to remember - when the movie gets played back, how will the client look the most responsive.
Ryan K. Stumphauzer (O'Quinn Stumphauzer) emphasized the importance of sitting down with the control group to define expectations.
On one hand you don’t want to give incomplete or inaccurate information and on the other hand you want to act quickly. The panelists discussed the possibility that the whistleblower could beat the company to the DOJ in reporting a problem.
One thing was clear - Dodd-Frank is very scary for counsel. Ms. Razzano notes - "[w]e want to protect our employees but we want to protect company to."
(esp)(blogging from Miami)
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