You can read the infographic version of our guide here.
Every regulated business should take the time to consider its policies and procedures around internal investigations. Legal professional privilege is often easier to state in theory than it is to apply in practice. The English Court of Appeal judgment in SFO v ENRC supports a culture of investigating issues when they arise which is to be encouraged.
Internal investigations are a vital first step when faced with a regulatory issue – the SFO v ENRC case overturned an earlier controversial High Court decision in the same case and restores some orthodoxy as to where and how legal professional privilege over documents can be claimed and maintained in the context of internal investigations.
The pathway to investigating regulatory issues and maintaining privilege in and keeping relevant documents confidential is now clear, and enables clients and counsel to converse freely and frankly.
Ogier's Regulatory team specialises in internal investigations, training, risk management and compliance obligations, particularly in complex and cross-border matters.
Legal advice privilege
Legal advice privilege protects confidential communications between a lawyer and client for the purpose of giving or receiving legal advice.
Litigation privilege applies to confidential documents produced when litigation is reasonably anticipated and where the dominant purpose at the time of the creation of the document is for use in relation to litigation.
5 things to do when conducting an internal investigation
When embarking on an internal investigation of a potential regulatory issue, consider instructing external lawyers at early stage
The 'client' in respect of whom privilege might be claimed must be clearly defined - who is specifically tasked with seeking and obtaining legal advice?
The dissemination of legal advice should be limited – advice should be circulated on a 'need to know' basis only
If discussing legal advice at a board meeting, consider producing two sets of minutes – one for legal advice, the other for commercial issues
Mark any privileged documents 'confidential and privileged' but be aware that simply saying a documents is privileged doesn't necessarily mean that it is
5 things to know about maintaining legal privilege
Set up a protocol for undertaking the investigation: establish a working group/designated team with clearly defined responsibilities to undertake the investigation
Don’t add comments on any legal advice received because such advice may not be privileged
In one Jersey case, a report the JFSC told a regulated entity to obtain was not subject to legal professional privilege, and the report was disclosable in an action by one of the business's clients
Attaching non-privileged documents to privileged documents does not give them any protection from disclosure
If reports need to be drafted, ensure they are drafted by external counsel and only shared with core investigations team – once confidentiality is lost so is privilege