Investigations

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Serious Fraud Investigation Office – Keeping a close watch on frauds in India Inc

The Serious Fraud Investigation Office (‘SFIO’) is an organisation established under the aegis of the Ministry of Corporate Affairs (‘MCA’) – for investigation and prosecution of white-collar crimes. The SFIO was constituted in July 2003 following the recommendations of the Naresh Chandra Committee. In 2002, the Naresh Chandra Committee had recommended setting up a ‘Corporate Serious Fraud Office’, to uncover corporate fraud, and supervise prosecutions under various economic legislations.
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Introduction

The growth and diversification of businesses have led to an increase in white collar crimes. The term ‘white collar crime’ was first defined by Edwin Hardin Sutherland as crimes committed by persons who hold high societal status and repute in their profession. As the complexity of such crimes has grown over the years and investigations have become refined, we have seen an increase in private professional services offering support to companies and their management in dealing with white collar crimes.

These support services extend from providing an in-depth analysis of the crime to the management, carrying out forensic investigations into the affairs of the company, including audit and forensic diligence reports and preparing the company for legal proceedings. The need for internal private investigations has also increased as a result of strengthening of laws on compliances and reporting of white collar crimes. The allegations may vary from offences under the Indian Penal Code (such as fraud, cheating, forgery, etc.) to offences under offences under special statutes (such as money laundering, insider trading, corruption, etc.).Continue Reading For or Against Forensic diligence when facing a White-Collar Investigation: Evidentiary Value

US DOJ Guidance Document : Corporate Compliance

On April 30, 2019, the US Department of Justice (DOJ) published a guidance document, “The Evaluation of Corporate Compliance Programs” (Guidance), aiming to provide greater transparency into its prosecution decisions. While the Guidance is primarily meant for the consumption of prosecutors considering an investigation and/or bringing charges against a corporation, it provides valuable insight for compliance conscious entities that are proactively looking to develop and further strengthen their corporate compliance programme (CCP).

The Guidance complements the principles set out in the Justice Manual, which describes specific factors that prosecutors must take into consideration, including inter alia, the adequacy and effectiveness of the corporation’s compliance programme at the time of both the offence and the charging decision, and the corporation’s remedial efforts to implement an adequate and effective corporate compliance programme or to improve an existing one. Additionally, the US Sentencing Guidelines advise that consideration should be given to whether the corporation had in place at the time of the misconduct an effective compliance programme to calculate the appropriate criminal fine.
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