In recent years, much of the law around legal professional privilege has been developed in cases involving regulatory bodies and investigations.
Reasons for this, we suggest, include the increased vigour with which regulatory enforcement actions have been pursued since the 2008 financial crisis, the number of high profile incidents in recent years, and resultant civil litigation. This is compounded by the costly impact that disclosure of privileged documents could have and the propensity to litigate to protect them, particularly where internal investigations have been undertaken and work product is produced that could prove extremely valuable to the other side of a dispute.
Disclosing privileged documents under a limited waiver to regulators has the potential to attract cooperation credit when regulators decide on level of penalty or, indeed, whether to undertake enforcement proceedings or prosecution. An example of this is in the context of deferred prosecution agreements (DPA), where cooperation by the entity under investigation is a factor the Serious Fraud Office (SFO) must consider in deciding whether a DPA is appropriate. There may also be benefits in referring to or relying on privileged material in any defence to regulatory enforcement or prosecution.
These strategies are not without risk. In particular, questions persist regarding the effectiveness of limited waivers in maintaining privilege in the relevant documents against the rest of the world. It is important to understand the legal landscape prior to making such decisions. Particularly as regulatory scrutiny increases in the wake of the COVID-19 response.
Laura Ford, Partner, and Shabaz Ahmed, Associate in our UK Corporate Crime, Compliance and Investigations team have prepared this article for the October 2020 edition of the Butterworths Journal of International Banking and Financial Law. It considers how the law around limited waiver, collateral waiver and “cherry picking” documents has developed to the position we find ourselves in today. Drawing on relatable case-studies, presented in key judgments, for this rapidly developing area of law. Because it’s important to know “what might happen if we disclose that document”.