The UK Serious Fraud Office cooperation guidance
The UK Serious Fraud Office (SFO) released its cooperation guidance on 6 August. The five-page document outlines what companies can do to assist the SFO in its investigations in order to be seen as cooperating.
The guidance sets out the way in which the SFO will assess the cooperation provided by business entities and the good practices that organizations should follow in cooperating in investigations. Cooperation is a key consideration in the SFOs charging decisions and particularly in their decision to enter into a deferred prosecution agreement. Cooperation of itself may not always guarantee an outcome and all decisions will be fact specific, but it will undoubtedly go a long way.
Cooperation in the document is defined as assistance going “above and beyond what the law requires”. For example, identifying suspected wrong doing and criminal conduct together with those responsible, no matter who they are and reporting this to the SFO within a reasonable time of the suspicions coming to light. It also includes preserving and handing over evidence to the SFO.
The guidance gives examples of good practice including preserving and retaining material; compiling documents in structured ways, such as sorting them by topic; preserving and providing passwords and recovery keys for digital devices; providing material which the organisation holds abroad and providing the SFO with financial records such as invoices, contracts and money flows.
The document suggests that companies wishing to cooperate with the SFO should give the agency industry knowledge, such as details on common practices and other actors in the market, and potential defences particular to the sector.
On internal investigations the guidance is not so helpful, but it makes it clear that organisations should consult the SFO before interviewing potential witnesses or suspects to avoid prejudicing the investigation. The same is expected before any personnel or HR actions are taken. Although the Director of the SFO has made it clear that organisations will want, and need to, take some investigative steps to establish what has happened before self-reporting to the SFO, it is not clear how far this acknowledgement extends.
One of the more contentious parts of the document states that, if an organisation claims privilege over witness accounts, it will need independent counsel to certify that the relevant material is indeed privileged. On the issue of whether companies are required to waive privilege over witness accounts in order to be perceived as cooperative, the guidance is disappointingly unclear and contradictory.
Certain other key areas of concern for companies, such as data protection issues and the risk of follow-on litigation that a company may face, are not addressed by the guidance.
The SFO has provided a full and comprehensive list of what ‘good’ looks like in this guidance but has emphasised that this is not a ‘one size fits all’ checklist and that some items will be inapplicable or even undesirable in a particular case.