Investigating Fraud: The Considerations and Process
What critical strategic considerations are essential for achievement inside a complex fraud investigation or asset recovery?
Understanding where documentation is held, what form it is in, the ability to acquire it and being aware of the information protection laws of certain jurisdictions, are initial key considerations.
Getting reliable and usable details about in which the assets are, is key when the investigation will probably lead to successful asset recovery. Whilst an entity that may be the focus of the fraud investigation might be incorporated in the Caymans, it is unlikely that any assets derived from fraud will in fact exist here. There is no use pursuing reasons for action and incurring the time and expense of those proceedings if you aren't ultimately pursuing a recovery, particularly in complex multi-jurisdictional cases.
Complex frauds in many cases are multi-jurisdictional, understanding international legal remedies is key in determining a successful strategy. We have heard often from litigants pursuing claims that they made no recoveries of assets. Too often we hear stories of wasted money and time spent pursuing an answer which was not viable, or worse obtaining a judgement but failing to generate a recovery. It is important, therefore, that you simply do some research upfront to ensure those advising you, particularly offshore, have the relevant experience and knowledge to get you the best result. We make use of a selection of remedies with respect to the most efficient route to recovery. For example, we might use insolvency tools if there is debt owed, and in some fraud causes it may be easy to get yourself a winding-up or receivership of the legal entity which could provide additional discovery powers regarding its assets, and possibly additional reasons for action to be pursued.
When undertaking cross-border investigations and asset recovery, just how can processes differ across jurisdictions? What misconceptions and assumptions in many cases are made concerning the ability to recover onshore and offshore?
One from the main challenges in complex financial investigations and asset recovery cases is the multi-jurisdictional nature. In instances where it is learned that the perpetrators used offshore corporate vehicles to hide their proceeds of fraud, a common belief is that with bank secrecy there being little public information available, there are few choices to investigate the fraud and recover the assets. However, as the means to obtain information and pursue assets will differ, the truth is that many principles in obtaining information to assistance with investigations or asset recovery apply equally in offshore jurisdictions because they do onshore, specifically in common law jurisdictions such as Canada, Australia, Ireland, Scotland, Hong Kong, Cayman Islands, the Bahamas, British Virgin Islands, the Channel Islands, and Gibraltar, simply to name a few.
Therefore, obtaining disclosure from organizations through the Courts e.g. Norwich Pharmacal, or Bankers Trust Orders, are accessible and frequently used, making it possible to obtain details of bank accounts and assets from banks, auditors, and registered agents, which might be critical to the investigatory and asset tracing process.
The main difference will arise between civil law and customary law jurisdictions; it may be more problematic to acquire discovery in civil law jurisdictions. However victims in civil law countries aren't left without remedies, and assumptions about what can and cannot be achieved often occurs high is a lack of skill in international asset recovery. We ensure we work with experienced local counsel to navigate the most effective and expeditious path to asset recovery.
How does digital forensics and e-discovery tools help you and your clients within this line of work?
Using forensic software along with other tools, we apply investigative and analytical techniques to examine digital devices to be able to identify, preserve, recover, and analyse data for evidence or any other relevant material. We follow industry standards to capture and present these details in a forensically sound manner which could then be utilized inside a Court.
We may reveal hidden files, recover deleted files, uncover timelines and other relationships among documents and communications and even this has often been the case once the perception was that the information had been deleted and wasn't any longer available. For example, inside a recent money laundering and corruption case, we were able to forensically image mobile phone data to recuperate deleted messages and texts so that we could identify key persons and also the degree of involvement/knowledge in the fraud.
We often use e-discovery tools whereby via a series of complex processes, data is loaded into a platform where it is organised, and displayed in a manner where we might search, review, and analyse it. The information may be the result of a legitimate hold, in reaction to a request production, or a part of a study, and may include emails, stand-alone documents like Word and Excel, messages, calendars, and social networking. Whatever the format, the information, or even the supply of the materials, eDiscovery professionals and technology provide us with the power find the needle inside a haystack, quickly, accurately, and price effectively. For example, I worked with a customer whose legal counsel had obtained documentation in support of a corruption and cash laundering investigation and was trying to obtain a worldwide freezing order on the defendant. Fortunately the data had already been uploaded onto our e-discovery platform whenever we were first engaged to get and image the data around 18 months prior. Within Two days we identified the change in huge amount of money from the construction project in to the personal bank account of the baby concerned.
What differentiates both you and your firm's method of financial investigations and asset recovery cases?
First is our hands-on approach. Our firm is markedly different for the reason that we're heavy in the senior level, so each assignment is led and it has the integral involvement of the senior employee. We don't delegate to junior staff down to the project. Nor do our senior associates only “front and end” the assignment; they are there step by step, which allows us to be nimble and inventive in addressing issues.
The second is our independence, we are centered on the client's interests, and not from the prospective audit or tax relationship, that also means we very rarely have conflicts of interests. We're happy with the diversity within our team which includes a number of professional expertise, including asset tracing and verification, forensic accounting, insolvency practitioners, former police force and IT forensic experts; using a multi-disciplinary team with experience of a wide range of recovery mechanisms, empowers independence and free-thinking that allows a truly practical approach for our client's needs.
Thirdly, whilst we incorporate the assimilation of publicly available information included in our methodology for identifying targets for asset recovery, KRyS Global differentiates itself using their company firms within our knowledge, and use discovery tools and on the floor intelligence gathering, to locate information outside the scope in our peers. We have unrivalled knowledge of locating and recovering hidden assets in offshore jurisdictions, and realize that asset recovery is not just buying and analysis of information and assets through technical expertise, but in implementing a considered but creative strategy in conjunction with a lawyer in criminal, civil or commercial dispute proceedings.
