31 Days to a More Effective Compliance Program -Who and When to suspend during an investigation?

Thomas Fox
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Who to suspend during any FCPA investigation is always a delicate question to answer and is never easy to answer. As the VW emission-testing scandal reverberated, it brought up some very knotty questions, which have continued bedeviled many a CCO or compliance practitioner in multiple areas. De-confliction is also an issue which continues to bedevil investigators and internal investigations. Mara Senn has said “That is a very case-by-case difficult question to answer, but in general, I think it’s better to keep them around for as See more +
Who to suspend during any FCPA investigation is always a delicate question to answer and is never easy to answer. As the VW emission-testing scandal reverberated, it brought up some very knotty questions, which have continued bedeviled many a CCO or compliance practitioner in multiple areas. De-confliction is also an issue which continues to bedevil investigators and internal investigations. Mara Senn has said “That is a very case-by-case difficult question to answer, but in general, I think it’s better to keep them around for as long as you may need them. Once they’ve been fired or otherwise disciplined, really, even if you keep them around, they’re going to be less cooperative with you and possibly, if you fire them, not cooperative at all. You can require them to be cooperative in the termination agreement, but obviously in practice, cooperation can mean a lot of different things.”

De-confliction, involves the government asking a company to halt its own investigation for the government to be the first to interview witnesses. Former DAG Lanny Breuer posed four questions which every investigator must consider in the area of de-confliction. (1) Would complying with the request be consistent with directors’ and corporate officers’ fiduciary duty of oversight? (2) How can a company make decisions without speaking with its employees? (3) How will a delay affect the company’s other regulatory obligations? and (4) How can external counsel advise a company without knowing the facts? Companies hire external counsel to conduct thorough investigations, evaluate their clients’ conduct, and provide informed legal advice. These tasks can be difficult if not impossible to accomplish where external counsel have their hands tied behind their backs.

Three key takeaways:

The decision on whom to discipline and when are critical decisions during any investigation.

You should take a case-by-case approach.

The “de-confliction” question can be quite troubling during an internal investigation. See less -

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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