Outside Publication

Conducting an Effective Cross-Border Investigation, International Bar Association Newsletter

August 31, 2018

Morgan Lewis partners Rebecca Kelly and Chris Warren-Smith share key considerations in an effective cross-border investigation.

Practitioners experienced in conducting cross-border investigations are acutely aware of the need to make regular and challenging judgment calls. The challenges are only increased by the current global and political environment in which enforcement is conducted. In this article, we consider some of the critical issues to consider in the framework of an effective cross-border investigation.

Background Factors

There are some general but critical background issues to address. By ways of dos and don’ts:


Do Not

Consider both the laws in the jurisdiction the employees are based, and the jurisdiction the issues are raised

Assume the local laws of all the jurisdictions can be ignored

Engage internal and external stakeholders early and maintain regular strategic communications where possible

Prejudge the outcome and make the facts fit that outcome

Take time to align your approach to the organisation’s corporate principles and culture

Engage in unnecessary conflict with the prosecutors and regulators as this can lead to a loss of trust

Identify all possible sanctions, outcomes, areas of potential reputation or impact from the outset and consider if there are any regulatory reporting obligations. Monitor the reporting obligations constantly

Fail to keep a clear audit trail of work done, judgement calls, and decisions made during the investigation, as this can undermine the integrity of the work and findings

Have a clear documented agreement of who at the company is the “client” for the purposes of the investigation at the outset to ensure protection of confidentiality and legal privilege

Underestimate cultural and legal challenges and the importance of seeking local advice

Make sure the investigation team and process have integrity and independence in both perception and reality

Understand the potential impact of individual interests diverting from those of the corporation and identify and manage these risks at an early stage

Emphasise the importance of gathering accurate facts on which key decisions will be made

Fail to assess and manage the risk of a civil litigation arising from actions potentially giving rise to corporate criminality

Use triage, scoping, and case theory and continually review them against the facts

Widely disclose the existence of the investigation internally or externally until the communication strategy has been finalised

Choose your team carefully taking account of internal and external resources and get the right balance, diversity, and jurisdiction-specific experience

Panic, take your time to develop the internal investigation plan

Take additional time to plan and get things right: scope, process, data transfer, privilege, interviews

Change the findings as a result of internal pressure by the business, or destroy any evidence

Practical Considerations

Decisions made throughout the investigation should be informed and guided by these background considerations. Very often, there will be no clear answer to a particular question and it will be necessary to fall back on guiding principles and common sense. In a fast moving situation, it is necessary for the relevant decision-making body to have the best available information to make decisions. In most investigations, the best tool a lawyer can start with is a clear, concise investigation plan, which of course may change if and when new information comes to light.

Internal communications and employee management are critical. Always take time to identify relevant whistleblowing legislation and procedures to ensure they are followed. Any breaches should be immediately identified and managed. Local employment advice needs to be taken as early as possible so that potential outcomes can be factored into decision-making. A programme of internal communication needs to be considered and developed as matters progress, always taking account of areas of legal concern (such as tipping off).

Different jurisdictions have different data transfer, disclosure, and privacy requirements. Others have blocking statutes. The key to providing swift responses to the relevant stakeholders is developing a data management strategy early that considers all applicable legislative regimes and has practical solutions for difficulties. Counsel need to look at usually a minimum of three jurisdictions: the jurisdiction the employees are based, the jurisdiction the “incident” has occurred in, and the jurisdiction(s) that may give rise to a regulatory reporting obligation. Few regulators or prosecutors around the world nowadays will be sympathetic to claims that the company is unable to produce data due to legal requirements in a foreign jurisdiction. Early decisions need to be made and steps taken about data preservation, collation, review, and production.

Internal and external communications need careful and early thought. Conflicts can arise between external press agencies and lawyers. In our view, best practice is for the law firm to retain the external communications company and to ensure that the corporation, lawyers, and PR consultants work closely together. At the same time as developing a strategy of communicating with external stakeholders, an internal communications strategy must be developed along the lines identified above. Mistakes are made where organisations do not give proper consideration at an early stage to communications with important stakeholders to their business. Some of the existing contracts may require urgent review as there may be reporting obligations contractually imposed on a company when fraud has been uncovered. Of particular concern in most jurisdictions would be the consideration of whether any contracts with government bodies would be impacted as a result of fraudulent activity.

The overarching key to resolving issues arising from investigations will often be developing and implementing appropriate remediation steps. These steps should be considered at an early stage and developed as more is known about the problems that have arisen and their causes. A dialogue about how issues will be dealt with and remediation steps taken is particularly important with both regulators and external stakeholders such as shareholders. An early understanding of the framework for the remediation approach and the ability to communicate this can often save significant time and money and go a long way towards rebuilding trust at an early stage.


Many of the areas considered in this article are generic, because in reality every single cross-border investigation is different based on the jurisdictions that are impacted, the allegations at the heart of the reason why the investigation must be undertaken, and the commercial and legal risks the investigation uncovers for the business. However, this article provides important guidance to handling challenging decisions that arise in cross-border investigations. Specific decisions that need to be taken must be based on local legal, and cultural understanding taking account of the relevant and competing interests of internal and external stakeholders. Failure to take time to engage with all these issues properly at the outset can have damaging consequences for the company that is the subject matter of an investigation but also for its employees and stakeholders.

This article first appeared on the website of the Employment and Industrial Relations Law Committee of the Legal Practice Division of the International Bar Association, and is reproduced by kind permission of the International Bar Association, London, UK. © 2018 International Bar Association.