Exclusive Q&A on Fraud and White Collar Crime with Shula de Jersey
Posted: 22nd December 2015 12:31Have there been any recent regulatory changes or interesting developments?
Section 92 of the Care Act 2014 creates a new criminal offence for a provider organisation to supply, publish or otherwise make available certain types of information that is false or misleading where that information is required to comply with a statutory or other legal obligation. The offence applies to all NHS foundation trusts, NHS trusts and other organisations that provide care and treatment for the NHS. In certain circumstances, the offence can be committed by individuals. The offence came into force on 1 April 2015 and was introduced in response to the Public Inquiry into Mid Staffordshire NHS Foundation Trust. It forms part of the UK Government’s overall drive to improve the openness and transparency in the provision of health services.
Can you outline the key fraud and white collar crime trends in your jurisdiction?
2015 has seen the UK’s Serious Fraud Office (“SFO”) agree its first Deferred Prosecution Agreement (“DPA”) since their introduction in February 2014. Standard Bank Plc entered into a DPA with the SFO in respect of an allegation of failure to prevent bribery by two executives contrary to Section 7 Bribery Act 2010. This case was also the SFO’s first concerning the corporate offence of failure to prevent bribery. The second DPA is expected imminently. Whether this sees the start of a flood of DPAs remains to be seen however given that the UK Government has shelved plans to create a corporate offence of failure to prevent fraud a trickle seems more likely.
Have there been any other noteworthy case studies or examples of new case law precedent?
The first DPA was approved by Lord Justice Leveson on 30 November 2015. The prosecution was deferred for a period of 3 years, required Standard Bank to pay a total of $49.1m in financial orders and be the subject of an independent review of its existing anti bribery controls. In his Judgment approving the DPA, the Judge emphasised that the Bank had self-reported within days of identifying the wrongdoing and fully co-operated with the SFO. The Judge also emphasised that these factors allowed for a full reduction of one third in respect of the financial penalty imposed. It is clear from this Judgment that the cooperation by a corporate is a key factor when deciding whether a DPA should be entered into.
What are the benefits and disadvantages in using court experts and expert witnesses?
Whether expert evidence is required in defending criminal cases depends on a number of factors, in particular whether the prosecution is reliant upon expert evidence. An expert witness are under a duty to the court to provide an objective and independent opinion on matters outside the experience or knowledge of a jury irrespective of any obligations owed to the party instructing them. Having obtained a defence expert report there is no currently no requirement on the defence to serve a report if there is no intention to rely upon that expert, for example because they assist in some areas but are not as helpful in others. In this situation often an expert report can provide assistance in cross-examination of other witnesses.
Can you explain how whistleblowing works in your jurisdiction with reference to incentives and protection?
The Financial Conduct Authority introduced new rules on whistleblowing that apply to banks and insurers in early October 2015. The new rules have numerous requirements that relevant firms need to put in place including: the appointment of a Senior Manager as their whistleblower’s champion; implement internal whistleblowing arrangements; inform UK based employees about the whistleblowing services; present an annual report to the firm’s board and notify the FCA if it loses an employment tribunal proceeding with a whistleblower. The requirements introduced by the FCA shows that the FCA considers more work is required in this area and continues to encourage whistleblowing. The FCA has however not taken any steps towards introducing US style financial incentives for whilstleblowing.
What advice would you give to an organisation undertaking an internal investigation when serious misconduct is suspected?
The aim of an internal investigation should be one of fact finding namely to determine what has happened. At the outset it is important to set out clearly the scope of the investigation, what its objectives are and what resources are required. Material relevant to the investigation must be identified and secured quickly with a clear documented process. Issues such as what may be covered by legal professional privilege need to be examined, particularly if the investigation covers different jurisdictions as different rules of privilege will apply. Consideration must be given to what regulatory or other notification requirements may apply. Consideration should also be given to whether employees who are suspected of serious misconduct should be suspended and offered independent legal advice as part of the interview process.
Shula de Jersey is a Principal Lawyer in the business crime department at Slater and Gordon in London.
She is an expert in all areas of white-collar crime including high profile fraud, money laundering and corruption and has represented clients in all areas of criminal law including serious crime.
She specialises in representing individuals in complex and serious fraud proceedings, health and safety and corporate manslaughter cases and has handled a number of Serious Fraud Office (SFO) investigations.
Shula has had articles published in The Lawyer, Legal Week, In-House Lawyer and Telegraph Online and is a
consultant editor for Lloyds Law Reports: Financial Crime.
Shula can be contacted on 020 7657 1766 or by email at sdeJersey@slatergordon.co.uk