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Corporate Miranda warnings and the FCPA

Click original to enlargeThe death of New York Times reporter Anthony Lewis brought out a spate of articles about the Gideon case, which provides that all persons charged with crimes are entitled to representation by counsel. This decision is often cited with the Miranda decision as two of the most important backbones in the rights of those charged with crimes.

In the FCPA context, I have pondered about what are not only the rights of those being investigated but also the obligations of those persons conducting an investigation, particularly if the results of the investigation will be turned over to the DOJ and may form the basis of a criminal enforcement action. Put another way, even if the company attorneys handling the investigation provided the now standard corporate attorney Upjohn warnings, how does a company attorney asking questions morph into a de facto federal agent during an internal company investigation regarding alleged FCPA violations and is the attorney thereby required to provide a Miranda warning to employees during a FCPA investigation? Do they have right to counsel?

Employees who are subject to being interviewed or otherwise required to cooperate in an internal investigation may find themselves under the dilemma of requiring either (1) cooperating with the internal investigation or (2) being fired for failure to cooperate by providing documents, testimony or other evidence. Many U.S. businesses mandate full employee cooperation with internal investigations or those handled by outside counsel on behalf of a corporation. These requirements can exert a coercive force, often convincing employees to act contrary to their personal legal interests by disclosing wrongdoing to corporate counsel. 

Moreover, such a corporate policy may allow a company to claim to the DOJ a spirit of cooperation in the hopes of avoiding prosecution in addition to increasing the chances of learning meaningful information. Through this mechanism, of using corporate counsel and pressuring corporations to cooperate, the U.S. Government is sometimes able to achieve indirectly what it would not be able to achieve on its own — inducing employees to waive their Fifth Amendment right against self-incrimination and minimizing the effectiveness of defense counsel’s assistance.

And what about private counsel who might compel such testimony? It may be that investigative counsel, whether corporate or outside counsel, could face state bar disciplinary proceedings. A corporation could face disqualification of its counsel and the disqualified counsel’s investigative results.

While I do not pretend to know the answer to all of the above, if we are moving more towards corporations performing investigations, turning over the results to the government which form the basis of investigations, there may be the need to create procedural rights guaranteed to employees similar to those created a generation ago in the Gideon and Miranda cases. On the death of Anthony Lewis, it is certainly something to think about.


Thomas Fox is a contributing editor of the FCPA Blog.

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1 Comment

  1. I am not at all concerned about any "coercive force" that may be felt by those under investigation for possible FCPA violations. For years we have been fed the mantra that oversized pay packets are justified because "if you don't pay top dollar you can't get the best people". Well, many of these highly paid "best people" have caused,been complicit,or benefited greatly from catastrophic blunders. If top dollar cannot get us the "best people" then top dollar must at least get us accountable/responsible people. If some highly paid individual wants to say "I knew it was against company policy and the law but I could make a lot of money and everyone was doing it" then let him say so. If they are looking for sympathy, they can find it in the dictionary a few pages ahead of syphilis.

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