Although record keeping (including note-taking and interviewing) is associated in people’s minds with investigation, it should be part of the working ethos (a corporate version of flossing teeth). The existence of accurate records means that if you are investigating a client or challenged by a suspect, court-compliant evidence can be swiftly produced.
Benefits
Such a culture can also help to protect you if you are in the unthinkable position of being under external attack, as, for example, in this cautionary tale from Anthony Woolich, partner with law firm Holman Fenwick Willan: “With the enforcement of competition law in mind, and with our client company’s approval, we carried out a mock dawn raid as a training exercise because it was felt that some people in the company were doing their own thing. We had authentic ID cards. Only the managing director and the general counsel knew who we really were. This was very useful. We were given free rein – we opened drawers, no one followed us around or recorded what we were looking at and they were a bit slow in calling the in-house legal department.”
Of course it could never happen to you, but here is another case of an organisation with poor record-taking discipline, also from Mr Woolich: “You have to keep internal investigations under control – you cannot ignore them. For example, a development bank was investigating the award and performance of a contract. The bank’s audit department contacted the contracting company, who failed to involve the head office legal department at first. The bank’s investigators spent a week in the regional office; employees responded but when we finally became involved they had no record of what information they had given to the bank’s investigators. The company had no focus for receiving questions and giving answers.”
And no matter how meticulous record keeping may be in one part of the organisation, it needs to be reinforced with adequate internal communications. “Be careful of sanctions, for example against trading with Iran or Syria,” Mr Woolich said.
“Things can go wrong when employees inadvertently transfer money without getting authorisation, for example, to or from listed asset-freeze targets. In that case you may have to make a report to the Serious Organised Crime Agency and you may also need to tell HM Treasury and the FCA. It is important to establish procedures so that this cannot happen. One part of an organisation may understand the issue but may not disseminate the rules to the people processing payment,” he added.
This underlines the importance of working closely with in-house or external lawyers.
In the event of suspected fraud – external or internal – your own investigations, carried out by professionally trained internal investigators, should give comfort to clients and shareholders that you are taking steps to recoup potential losses; carried out properly, they also reduce or even avoid potential litigation costs. A bungled investigation, however, can waste time and money if investigations do not meet the correct legal standards, as well as attracting bad publicity.
For example, if amassing digital and electronic evidence, the wrong approach might lead you to commit an offence yourself, inadvertently. Investigators need a working knowledge of the Association of Chief Police Officers’ guidelines for computer-based evidence and the Computer Misuse Act:
Records must comply with the requirements of criminal law so that when they are produced as evidence they are admissible and reliable in court – it is no good just handing over a bin-liner of print-outs and hoping for the best. Failure to comply may mean that the police will not be able to follow up allegations, so work closely with the police and any other relevant external agencies.
Also, if a case is taken to the civil courts to recover money lost, it is vital to comply with correct procedures, avoiding any accusation of business practices that might be deceitful, unfair or improper.
In addition, you should try not to score an HR own-goal: “If investigating your own employees, be careful not to incur a claim for unfair dismissal or unfair treatment: it is essential to comply with employment law,” said Mr Woolich.
Even if a solid investigation has been conducted, with acceptable questioning procedures and correctly drafted written evidence, the success of any ensuing legal case often depends on the performance of the witnesses.
You may need to consider training to ensure that your investigators are familiar with court procedure, understand their role and are able to withstand the rigours of cross-examination. If the matters are complex, witnesses need to be able to explain them clearly; they also need to be able to justify their investigative procedures, making sure they comply with any relevant legislation such as the Data Protection Act and the Regulation of Investigatory Powers Act; they may also need a passing familiarity with key sections of the Human Rights Act.
One final note the Bribery Act 2010 put the focus on what can constitute bribery (keep those opera tickets proportional). There was a flurry of attention when it came into force. So far, there has not been a corporate prosecution under the Act as the Act only applies to activities since 1 July 2011. But there continue to be enforcement actions under the old law and there are several current investigations of companies under the Act, so there is no scope for complacency. An open culture where people think and act like archivists can help in this area too.
Mark Solon is managing director of Bond Solon Training
What to do, what to avoid
Health warning: these illustrations are simplified outlines of procedures – there are further legal ramifications not gone into here.
Mobile phone seizure, what to do and what to avoid:
Do
• If the mobile telephone is switched on, record what is on the display and then turn the mobile off.
• Seal in a tamperproof manner, in a box, making sure buttons cannot be pressed through the packaging.
Don’t
• Don’t press any buttons other than to turn the mobile off.
• Don’t try and access information. If you do, you may well be committing an offence yourself.
To produce an email from a witness
• Create a folder on the computer and give it a title such as a case number or the name of witness.
• Copy out from the email program the offending email or emails into the folder you have created on the computer.
• Burn that folder to recordable media (for your CD or DVD) using the burn facility on the computer.
Don’t give the Elbow
Best practice in note taking:
• No Erasures – don’t cross out large portions of text so that they are illegible.
• No Leaves torn out.
• No Blank spaces – or, if there are, rule them out.
• No Overwriting.
• No Writing in the margins (except dates, times and/or initials).
Key points
• Although record keeping is associated in people’s minds with investigation, it should be part of every firm’s working ethos.
• No matter how meticulous record keeping may be in one part of the organisation, it needs to be reinforced with adequate internal communications.
• You may need to consider training to ensure that your investigators are familiar with court procedures.
