A new approach to fraud on a global scale

With more litigation and discussion in relation to the extra-territorial reach of government powers Amanda Pinto QC has written the following article, published in the Times Online:

https://www.thetimes.co.uk/article/a-new-approach-to-fraud-on-a-global-scale-zznb8rzhp

“Recent developments in commercial crime investigations acknowledge that a more global response is necessary to combat fraud. They also show a trend away from a reliance on mutual legal assistance — co-operation between states to obtain evidence through diplomatic channels — which can be cumbersome and slow.

In a recent case the Serious Fraud Office (SFO) served section 2 notices requiring production of material held overseas by the foreign parent company of a corporation that it was investigating. The parent company argued that the SFO’s jurisdiction did not extend this far. The court, however, held that a section 2 notice  is lawful, even in the case of a foreign company, as long as there is a “sufficient connection” between the company and the UK. 

The court acknowledged that it was a “strong thing” for the law of state A to infringe the sovereignty of state B by requiring a citizen of state B on B’s territory to take action, under threat of criminal sanction in state A.  Nonetheless, because documents relevant to an investigation of a UK company were increasingly likely to be held overseas by foreign companies, the power of section 2 would be frustrated — and the public interest not served —if a foreign company could refuse to provide documents on grounds of jurisdiction, that is, simply because they were overseas.

The court did, however, set some limits: it ruled that neither the fact that the company was the parent company of a UK company, nor that it had co-operated with the SFO, was enough, on its own, to demonstrate a sufficient connection. The second ruling must be policy-based: it would clearly be contrary to the public interest to penalise a company for co-operating with the authorities.

In practical terms, therefore, a foreign company complying with an SFO section 2 notice without challenging the “sufficient connection” may now be seen as a valuable hallmark of co-operation. Other agencies (such as the Financial Conduct Authority and National Crime Agency) are likely to adopt a similar approach to their compulsory powers.

There have been other developments. Under the Crime (Overseas Production Orders) Bill 2018, if passed, a court would be able to grant an order requiring an overseas service provider to produce or allow access to electronic information stored overseas for the purposes of investigating serious crime, obviating the need for mutual legal assistance.

The Court of Appeal in the recent ENRC appeal, confirmed the principle of legal professional privilege and, criticising the current narrow definition, Sir Brian Leveson referred to the undesirability of the UK being out of step with other common law countries when so many multinationals operate across borders.

Finally, the SFO’s new director, Lisa Osofsky, has emphasised her intention to liaise closely with foreign law enforcement agencies. She has already appointed a former prosecutor, Peter Pope of the US law firm Jenner & Block, to build and consolidate relationships with the US authorities. She also emphasised that she wants to encourage co-operating suspects to come forward. 

Each of these steps reflects an awareness that modern crime, and the globalisation of financial wrongdoing, fraud and corruption in particular, now require a different approach to cross border investigations. 

Amanda Pinto QC”

http://33knowledge.com/amanda-pinto-qc/

Corporate Governance Conference 2018: Getting it right in time of change

Martin Evans QC will be speaking at the 2018 Corporate Governance Conference on the 26th June.

"Theresa May stood on the doorstep of 10 Downing Street on her first day as Prime Minister, she announced that she wanted big businesses to be held to account: the latest corporate governance proposals seek to reform executive pay, strengthen the employee, customer and supplier voice, and tackle the corporate governance of large privately-held businesses. These proposals are in the process of being implemented including a ‘shorter and sharper’ Code of Corporate Governance being finalised by the Financial Reporting Council for 2019."

The conference brings together experts, academics and practitioners to provide practical insight into the key corporate governance events for 2018.

The conference will help delegates to:

• Identify trends and developments in corporate governance.

• Understand the interplay between governance and corporate success – and what to do when things go wrong.

• Share the highs and lows of a range of GDPR compliance projects.

• Get up to speed on new reporting obligations, including gender pay gap.

• Hear the latest on government-proposed corporate governance reform.

• Get the lowdown on corporate crime, including the offence of failure to prevent the facilitation of tax evasion.

Martin Evans QC is speaking on the subject of:

Trends in corporate crime

"From the introduction of Deferred Prosecution Agreements in 2014 to the new corporate crime of ‘failure to prevent the facilitation of tax evasion’ introduced last year, much has changed in the world of corporate crime in recent years. The focus is on companies putting in place adequate policies, procedures and processes to avail themselves of a defence. This session will consider the latest trends, including:

•Whither ‘directing mind and will’?

•What is a ‘failure to prevent’ offence? What does it mean?

•Deferred Prosecution Agreements

•Investigations, documents and privilege

•Litigation Privilege over documents prepared as part of an internal investigation: the Bilta and ENRC decisions considered

•Privilege against self-incrimination and pre-existing material: River East"

See http://www.clt.co.uk/media/974308/cf9731.pdf for the full conference schedule and booking details.

Harpreet Singh Giani Joins Chambers

Chambers is delighted to announce that Harpreet Giani has accepted an invitation to join Chambers after the successful completion of his pupillage, as a transferring lawyer.

Harpreet is one of very few practicing Barristers at both the English and Indian Bar. His expertise in cross border issues, appeal work, procedure and high value commercial wrongdoing litigation is unique and will assist Chambers in strengthening its international work and reputation.

With 13 years of litigation experience in the Punjab & Haryana High Court (the Indian equivalent of the EAW Court of Appeal) Harpreeet's Indian practice spans commercial, corporate, constitutional, regulatory, property laws and arbitration. He is standing counsel for the government of Chandigarh and represents several statutory authorities in the state of Punjab.

Harpreet’s EAW work takes in asset recovery, litigation, judicial review and cross-border advisory work. As a tenant with Chambers, his practice will be based in this jurisdiction whilst maintaing a significant presence in India.