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Investigate—to examine, study, or inquire into systematically; search or examine into the particulars of; examine in detail.

The Problem

Allegations of corporate corruption arise almost daily in the fast-paced, connected, highly regulated business world. Whether leveled by regulators, employees, business partners, or adversaries in litigation, companies must respond swiftly and decisively to allegations of corporate corruption. Independent counsel forms a crucial element of that response—ensuring the integrity of the investigation and avoiding conflicts of interest.

The Solution

Johnston Clem Gifford designs and conducts internal investigations for companies facing the regulatory, reputational, or litigation risks presented by corruption allegations. We counsel our clients through crisis, often working with boards, corporate security, or risk management departments, to discover the truth and to defend the company in a variety of forums.

Depending on the stakes, the protection of the corporation and its officers and directors often requires internal investigations so that the decision makers are fully informed about potential adverse consequences, and how to mitigate loss to the company and its management team.

As most corporations know, internal investigations have become a necessity in today’s exceedingly complex legal environment. Corporate decision makers, shareholders, and governmental agencies often expect corporations to conduct internal investigations in the face of serious allegations of misconduct.

Conduct the investigation through the lens of a prosecutor

Beyond civil litigation, corporations must also consider the risk of criminal exposure. To minimize that risk, we recommend that our clients take a long-term approach to corporate citizenship. The United States Department of Justice offers guidance through its Principles of Federal Prosecution of Business Organizations. The DOJ considers the following factors when determining whether to prosecute, and the Firm uses these factors as a guide for its clients:

  1. The nature and seriousness of the offense, including the risk of harm to the public, and applicable policies and priorities, if any, governing the prosecution of corporations for particular categories of crime.
  2. The pervasiveness of wrongdoing within the corporation, including the complicity in, or condonation of, the wrongdoing by corporate management.
  3. The corporation’s history of similar conduct, including prior criminal, civil, and regulatory enforcement actions against it.
  4. The corporation’s timely and voluntary disclosure of wrongdoing and its willingness to cooperate in the investigation of its agents, including, if necessary, the waiver of corporate attorney-client and work product protection.
  5. The existence and adequacy of the corporation’s compliance program.
  6. The corporation’s remedial actions, including efforts to implement an effective corporate compliance program or to improve an existing one, to replace responsible management, to discipline or terminate wrongdoers, to pay restitution, and to cooperate with the relevant government agencies.
  7. Collateral consequences, including disproportionate harm to shareholders, pension holders and employees not proven personally culpable and impact on the public arising from the prosecution.
  8. The adequacy of the prosecution of individuals responsible for the corporation’s malfeasance.
  9. The adequacy of remedies such as civil or regulatory enforcement actions.

In the face of high stakes, engage independent counsel

Steer clear of potential conflicts of interest. In-house or primary outside counsel might tend toward favoring management—at a minimum, that perception may exist by third parties such as prosecutors or regulators. When the stakes are high, independence is critical. If the investigation is more routine in nature and addresses a more common occurrence, then existing outside counsel may be appropriate. The larger the stakes, the more important the need for an independent fact finder.

What we do

Our lawyers understand the sensitivity and diplomacy required to interact with internal actors, as well as regulators, law enforcement, and the media. As counsel, we support management and corporate boards by:

  • Revealing relevant facts so the company and the board can make fully informed decisions;
  • Stopping the corrupt conduct to prevent further violations;
  • Memorializing the company’s good-faith response to facts as they become known;
  • Insulating management and the board against allegations of complicity; and
  • Promoting a culture of transparency and compliance throughout the organization.

Johnston Clem Gifford’s diligence supports your success. We have guided large and small corporations, banks, and other financial institutions through allegations of fraud, bribery, and corruption. We have defeated whistleblower lawsuits at the motion to dismiss stage. We have counseled on sensitive personnel matters, crafted responses to regulatory inquiries, and managed enforcement and remedial actions, all while maintaining the highest levels of discretion.