A court in the Southern District of New York recently issued a noteworthy opinion in addressing a discovery dispute concerning communications between a non-party witness at the center of the SEC’s allegations and her attorneys, to whom she provided false information expecting they would pass it along to the SEC. In denying defendants’ request to examine the witness’s attorneys on these issues, the court held that although certain communications were no longer privileged because the witness waived the privilege and the crime-fraud exception applied, it would limit the extent to which the defendant could examine the attorneys on those communications on the basis of the proportionality requirement under Rule 26. The opinion serves as an apt reminder to defense counsel seeking exculpatory information being withheld as privileged that Rule 26’s proportionality requirement may pose an additional hoop through which to jump, even where arguments regarding the crime-fraud exception and waiver are successful.
Continue Reading Court Invokes Rule 26 Proportionality Requirement as Added Barrier to Discovery in SEC Action
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Client Advisory: Singapore Data Protection: Considerations for Data Driven Compliance Activities
By Lucinda Low, Wendy Wysong, Ali Burney & Wan Yi Ho on
Posted in Other
Singapore has long been a regional banking and trading hub, but in recent years, as multinational companies in other sectors have moved their regional headquarters to Singapore, it is also emerging as a regional data hub. This shift has implications for companies involved in US compliance and investigation activities in the Asia-Pacific region. US authorities…
Client Advisory: Second Circuit’s Decision in Mangouras: Implications for Privilege Assertions in Cross-Border Investigations
Posted in Investigation Process Issues, Other
Increasingly frequent cross-border investigations have raised difficult questions of privilege and work product protection over the last few years. In the United States, attorney-client privilege protects confidential communications between attorneys and clients for the purpose of seeking or rendering legal advice, and the work product doctrine protects documents or materials prepared in anticipation of litigation…
SEC Leadership Changes Are Afoot
By Chris Conte & Alexandrea Rahill on
Posted in Enforcement Policy Developments, Other
There have been two moves in SEC leadership over the last week that warrant attention.
First, last week, the SEC announced that Division of Enforcement Co-Director Steven Peikin will leave the agency at the end of this week. Stephanie Avakian, who has served alongside Mr. Peikin as Co-Director, will remain Director upon Mr. Peikin’s departure.
During his three years of service as Co-Director, Mr. Peikin, together with Avakian, established the agency’s Cyber Unit, increased retail investor protections, and recently created the Coronavirus Steering Committee to combat COVID-related fraud.…
The Financial Reporting Council’s Bite Proves Worse than its Bark
By Zoe Osborne & Peter Ibrahim on
Posted in Enforcement Policy Developments, Other
The Financial Reporting Council (FRC) is an independent regulatory body in the U.K. and Republic of Ireland (ROI) responsible for regulating auditors, accountants and actuaries. The FRC and its subsidiaries also play important roles in the oversight and development of corporate governance standards in the U.K. and ROI, such as the U.K. Corporate Governance and Stewardship Codes and the general standards for the accounting industry.
Founded in 1990, the FRC historically has tended to attract less attention than some of the better known and better funded U.K. enforcement bodies including the Financial Conduct Authority (FCA) which regulates the U.K. financial services authority and Serious Fraud Office (SFO) which investigates and prosecutes serious or complex fraud and corruption in England, Wales and Northern Ireland. But any complacency or ignorance of the significance or broad range of powers and sanctions at the FRC’s disposal may come at a significant cost – the FRC’s enforcement activities are on the increase and the entity is becoming a major player in the U.K. regulatory environment.
The provisions governing FRC enforcement were originally set out in an Accountancy Scheme and Actuarial Scheme (the Schemes) – contractual arrangements between the FRC and the various accountancy and actuarial professional bodies. Following the implementation of EU legislation in June 2016, however, a new Audit Enforcement Procedure (AEP) is used for all new audit matters. The Accountancy Scheme continues to be used for non-audit matters and audit investigations that commenced before June 2016 while the Actuarial Scheme continues to be used for all actuarial investigations.…
Continue Reading The Financial Reporting Council’s Bite Proves Worse than its Bark
The Elusive “Directing Mind and Will”
By Zoe Osborne & Peter Ibrahim on
Posted in Criminal Procedure, Other
On February 28, 2020, a jury acquitted three former Barclays executives – Roger Jenkins, Tom Kalaris and Richard Boath – of criminal fraud charges brought by the Serious Fraud Office (SFO). The charges were founded on allegations that the three had conspired to make secret payments to Qatar in exchange for the state’s provision of…
UK Court of Appeal Rejects Unexplained Wealth Order Challenge
By Zoe Osborne & Ayushi Sharma on
Posted in Criminal Procedure, Other
On February 5, 2020, the UK Court of Appeal dismissed a challenge to the UK’s first Unexplained Wealth Order (UWO). Mrs. Zamira Hajiyeva, wife of the former chair of the International Bank of Azerbaijan who was sentenced to 15 years in jail in 2016 for defrauding the bank out of £2.2 billion, launched a challenge…