Individuals in Cross-Border Investigations or Proceedings: The US Perspective

¹ Amanda Raad and Michael McGovern are partners, and Meghan Gilligan Palermo, Zaneta Wykowska and Sara Berinhout are associates, at Ropes & Gray LLP.

² Beginning with the ‘Yates Memo’, issued in late 2015 by former US Deputy Attorney General Sally Yates, the DOJ instituted a policy emphasising the need for US prosecutors to pursue prosecutions of individuals involved in corporate wrongdoing. To effectuate this policy, the Yates Memo mandated that, for a company to receive any co-operation credit, it must provide the DOJ with ‘all relevant facts about the individuals involved in corporate misconduct’ in both criminal and civil cases, regardless of the level of their involvement in the alleged misconduct. See Memorandum from Sally Quillian Yates, Deputy Att’y Gen., U.S. Dep’t of Justice, Individual Accountability for Corporate Wrongdoing (9 September 2015), https://www.justice.gov/dag/file/769036/download.

³ In recent years, the DOJ has relaxed the rigid requirements of the Yates Memo, no longer requiring companies to identify every person with a role in wrongdoing, regardless of culpability level. However, DOJ policy still mandates that companies identify all individuals who were ‘substantially involved in or responsible for the misconduct at issue’ to receive any co-operation credit. In the civil context, the DOJ has implemented a ‘sliding scale’ approach where co-operation credit is awarded based on the degree of co-operation. See Rod J Rosenstein, Deputy Attorney General, U.S. Dep’t of Justice, Prepared Remarks for the 35th International Conference on the Foreign Corrupt Practices Act (29 November 2018), https://www.justice.gov/opa/speech/deputy-attorney-
general-rod-j-rosenstein-delivers-remarks-american-conference-institute-0.

⁴ See U.S. Dep’t of Justice, Criminal Division Fraud Section Year in Review 2018, https://www.justice.gov/criminal-fraud/file/1123566/download; U.S. Dep’t of Justice, Criminal Division Fraud Section Year in Review 2017, https://www.justice.gov/criminal-fraud/file/1026996/download (301 individuals charged in white-collar cases in 2017 and 300 in 2016).

⁵ For example, one of the DOJ’s headline cases in 2018 saw numerous individuals charged in a scheme to pay bribes to government officials in Venezuela in exchange for business with Venezuela’s state-owned energy company, Petróleos de Venezuela S.A. (PDVSA), Press Release, U.S. Dep’t of Justice, Five Former Venezuelan Government Officials Charged in Money Laundering Scheme Involving Foreign Bribery (12 February 2018), https://www.justice.gov/opa/pr/five-former
-venezuelan-government-officials-charged-money-laundering-scheme-involving-forei-0.

⁶ See U.S. Dep’t of Justice, Justice Manual § 9-15.635 (2018), https://www.justice.gov/jm/jm-9-15000-international-extradition-and-related-matters (Justice Manual); see also U.S. Dep’t of Justice, Justice Manual: Criminal Resource Manual § 611 (2018), https://www.justice.gov/jm/criminal-resource-manual-601-699 (Criminal Resource Manual).

⁷ For this reason, counsel engaged during the investigatory phase of a cross-border DOJ investigation should carefully consider the client’s exposure to prosecution and risk of arrest while overseas. The client should be advised to carry counsel’s contact details at all times. In some cases, and taking into consideration the client’s home country, counsel may advise the client to refrain from international travel while the DOJ’s investigation is pending.

⁸ Under the Bail Reform Act, 18 U.S.C. § 3142(b) & (c)(1)(B), US courts must order a defendant’s pretrial release unless the court ‘determines that such release will not reasonably assure the appearance of the person as required or will endanger the safety of any other person or the community.’ Where a defendant is released, the court must do so ‘subject to the least restrictive further condition, or combination of conditions that . . . will reasonably assure the appearance of the person.’ On the other hand, a court must order detention if it ‘finds that no condition or combination of conditions will reasonably assure the appearance of the person as required and the safety of any other person and the community.’ Id. § 3142(e).

⁹ See, e.g., United States v. Zarrab, 15-CR-867, 2016 WL 3681423, at *7 (S.D.N.Y. 16 July 2016); United States v. Epstein, 155 F. Supp. 2d 323, 326 (E.D. Pa. 2001).

¹⁰ Communications with such parties should be through counsel and only pursuant to common interest privilege.

¹¹ See id.

¹² Initial discussions with the client should include a detailed and candid conversation about the client’s financial resources, goals for how those resources are deployed and the availability, if any, of insurance coverage. Litigating criminal actions has grown increasingly expensive in recent decades. Counsel should ensure that the client has a complete understanding of the resources necessary to defend the case, particularly if the client fights the charges and all the more so if the client is self-funding the representation. Where a client is able to be covered under a ‘D&O’ (directors and officers) policy or similar liability insurance, counsel may advise the client to retain specialised insurance counsel to assist in obtaining and understanding potential limitations on coverage, for example, policy provisions allowing the insurer to claw back legal fees if the client later pleads or is found guilty of criminal charges.

¹³ In all cases, it is important to consider at the outset the need for other counsel, including employment counsel, extradition counsel, regulatory counsel or counsel specialising in the privacy laws of the relevant jurisdiction.

¹⁴ Bruce Zagaris, International White Collar Crime: Cases and Materials 413 (2d ed. 2015), https://www.cambridge.org/core/books/international-white-collar-crime/extradition-and-alternatives/ A89CB30F7457E4EFCD81B046DB0833A5 (‘According to the Department of State, U.S. courts certified 137 extradition requests between 1945 and 1960 – an average of only 9 per year. In 1995, in contrast, the U.S. extradited 79 people to other countries and received custody of 131.’).

¹⁵ See Ronald J Hedges, Federal Judicial Center International Litigation Guide: International Extradition: A Guide for Judges 1, 4 (2014), https://www.fjc.gov/sites/default/files/2014/International-Extradition-Guide-Hedges-FJC-2014.pdf.

¹⁶ For instance, the treaty between Albania and the United States includes an inventory of more than two dozen crimes. Extradition Treaty, Alb.-U.S., art. 2, 1 March 1933, 49 Stat. 3313.

¹⁷ Justice Manual, supra note 6, § 9-15.635 (2018); see also Criminal Resource Manual, supra note 6, § 603.

¹⁸ See, e.g., Extradition Treaty, U.K.-U.S., art. 4(1)-(2), 31 March 2003, T.I.A.S. 07-426 (UK Extradition Treaty).

¹⁹ Historically, the most common extradition treaty provision provided that signatory countries were not required to extradite their own citizens. See M Cherif Bassiouni, International Extradition: United States Law and Practice 746 (6th ed. 2014). This practice has evolved, however, and many modern treaties contain provisions either prohibiting signatory countries from denying extradition on the basis of nationality, or providing that denial on the basis of nationality is permissible only if the case is referred to local authorities for prosecution. See, e.g., U.K. Extradition Treaty, supra note 18, art. 3; Extradition Treaty, Peru-U.S., art. 3, 26 July 2001, T.I.A.S. 03-825; Extradition Treaty, Belize-U.S., art. 3, 30 March 2000, T.I.A.S. 13089; Extradition Treaty, Para.-U.S., art. 3, 9 November 1998, T.I.A.S. 12995; Extradition Treaty, S. Kor.-U.S., art. 3, 9 June 1998, T.I.A.S. 12962; Extradition Treaty, Pol.-U.S., art. 4, 10 July 1996, T.I.A.S. 99-917. Certain countries do, however, continue to prohibit extradition of their nationals but retain the discretion to do so. See, e.g., Extradition Treaty, Fr.-U.S., art. 3(1), 23 April 1996, T.I.A.S. 02-201 (France Extradition Treaty); Extradition Treaty, Ger.-U.S., art. 7(1), 20 June 1978, 32 U.S.T. 1485.

²⁰ See U.S. Dep’t of State, Treaties in Force: A List of Treaties and Other International Agreements of the U.S. in Force on January 1, 2019, https://www.state.gov/wp-content/uploads/2019/06/2019-TIF-Bilaterals-6.13.2019-web-version.pdf.

²¹ See Inter-American Convention on Extradition, 26 December 1933, 49 Stat. 3111 https://www.oas.org/juridico/MLA/en/Treaties/en_Conve_Extra_Inter_American_1933_Montevideo.pdf; Extradition Agreement, European Union-U.S., 25 June 2003, S. Treaty Doc. No. 109-14, https://www.congress.gov/109/cdoc/tdoc14/CDOC-109tdoc14.pdf. In addition, the United States is party to several multilateral international conventions that further reinforce bilateral extradition treaties by binding member states to either extradite or prosecute individuals charged with particular offences. See, e.g., United Nations Convention for the Suppression of Unlawful Seizure of Aircraft art. 8, 16 December 1970, 860 U.N.T.S. 105; United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances art. 6, 20 December 1988, 1582 U.N.T.S. 95.

²² Justice Manual, supra note 6, § 9-15.210.

²³ Id. § 9-15.300.

²⁴ Specifically, the presiding judge in the foreign jurisdiction will confirm the identity of the individual, that the relevant treaty and domestic laws support extradition for the alleged offence, that the complaint filed by the United States sets forth sufficient facts to support probable cause to believe that the alleged offence was committed, and that all other elements of the extradition request comply with treaty provisions. See Hedges, supra note 15, at 10-11. The individual is then provided an opportunity to challenge the validity of the extradition request on various factual and procedural grounds. The Federal Rules of Criminal Procedure, Civil Procedure and Evidence do not apply in extradition proceedings. See In re Requested Extradition of Kirby, 106 F.3d 855, 867 (9th Cir. 1996) (Noonan, J., dissenting); Fed. R. Evid. 1101(d)(3); Fed. R. Crim. P. 1(a)(5). Accordingly, hearsay evidence and unsworn statements may be admissible. See, e.g., Haxhiaj v. Hackman, 528 F.3d 282, 292 (4th Cir. 2008); Zanazanian v. United States, 729 F.2d 624, 626 (9th Cir. 1984); Collins v. Loisel (Collins II), 259 U.S. 309, 317 (1922); Artukovic v. Rison, 784 F.2d 1354, 1356 (9th Cir. 1986).

²⁵ All modern US extradition treaties include articles providing for provisional arrest. See S. Exec. Rep. No. 106-26, at 31 (2000) (report from U.S. Senate Committee on Foreign Relations); see, e.g., Extradition Treaty, Canada-U.S., art. 11(1), 3 December 1971, 27 U.S.T. 983.

²⁶ Criminal Resource Manual, supra note 6, § 615.

²⁷ Typically, once a provisional arrest is made, prosecutors have between one and three months to submit a formal extradition request. See Justice Manual, supra note 6, §§ 9-15.210, 9-15.230; see, e.g., Extradition Treaty, Canada-U.S., art. 11(1), 3 December 1971, 27 U.S.T. 983 (requiring release ‘upon the expiration of forty-five days from the date of his arrest’ if an extradition request is not received within that time).

²⁸ If a client is taken into custody under a provisional arrest warrant, counsel likely will need to advise the client regarding bail, which may be sought in the responding jurisdiction while extradition is pending. Clients may need to mobilise significant resources and assemble bond guarantors to effectuate bail as quickly as possible. For this reason, too, it is essential that experienced extradition counsel in the relevant jurisdiction be engaged to navigate bail issues in the responding state.

²⁹ Justice Manual, supra note 6, § 9-15.400.

³⁰ Jonathan Masters, What is Extradition?, Counsel on Foreign Relations (11 April 2019), https://www.cfr.org/backgrounder/what-extradition.

³¹ United States v. Blanco, 861 F.2d 773, 780 (2d Cir. 1988), cert. denied, 489 U.S. 1019 (1989); United States v. Pomeroy, 822 F.2d 718, 720 nn.3-4 (8th Cir. 1987); United States v. Walton, 814 F.2d 376, 380 (7th Cir. 1987); see also Criminal Resource Manual, supra note 6, § 601-99.

³² For example, extradition proceedings in the foreign jurisdiction may be susceptible to political considerations, which may influence the timeline for extradition and even whether it occurs at all. The US government’s ongoing effort to extradite WikiLeaks founder Julian Assange from the United Kingdom is a prime example. After a long criminal investigation beginning in 2010, Mr Assange was charged by US authorities in 2018 with conspiracy and espionage related to the leak of classified documents. See Indictment at 4-6, United States v. Assange, No. 1:18-cr-111 (E.D. Va. 6 March 2018), https://www.justice.gov/opa/press-release/file/1153486/download. After spending seven years in the Ecuadorian embassy in London resisting extradition in connection with an unrelated prosecution in Sweden, Mr Assange lost the extradition case and Ecuador withdrew his asylum in early 2019. See Assange v. Swedish Prosecution Auth. [2011] EWHC 2849. He was thereafter arrested by UK authorities on a provisional arrest warrant in 2019 and faces an extradition hearing in the United Kingdom in 2020. Current political uncertainties, likely will impact whether Mr Assange is ultimately extradited to the United States. See John T Nelson, L’Affaire d’Assange: Why His Extradition May Be Blocked, Just Security (7 June 2019), https://www.justsecurity.org/64425/laffaire-dassange-why-his-extradition-may-be-blocked/.

³³ This approach, however, requires careful consideration of the collateral consequences of successfully defeating extradition, including the possibility that the United States may bring new charges and initiate another extradition proceeding even after their first attempt at extradition fails. In addition, the client likely will be effectively prohibited from travelling to any country with which the United States has an extradition agreement because of the risk that the United States could initiate extradition proceedings in that jurisdiction.

³⁴ Another consideration relevant to assessing the strength of the evidence is that a client is not legally entitled to discovery from the US government related to the underlying criminal charges until he or she makes an appearance in a US court. While the foreign court presiding over the extradition proceeding may have have discretion to grant discovery pursuant to its ‘inherent power’, any discovery obtained (if at all) will be limited in scope and nature. See Quinn v. Robinson, 783 F.2d 776, 817 n.41 (9th Cir. 1986); see also Oen Yin-Choy v. Robinson, 858 F.2d 1400, 1407 (9th Cir. 1988). Accordingly, in most cases, clients will not receive any discovery until extradited (by force or consent), making it challenging to accurately assess the strength of the government’s evidence. Counsel likely will have access only to evidence the client has in his or her possession, information gleaned from co-defendants (pursuant to a joint defence agreement), and evidence provided by the US government, which is likely to be scant (or non-existent) if the client is resisting extradition.

³⁵ US courts are divided on whether an individual defendant has standing to raise a ‘rule of specialty’ challenge. In some circuits, the defendant has the right to raise a doctrine of specialty challenge. See, e.g., United States v. Stokes, 726 F.3d 880, 889 (7th Cir. 2013) (collecting cases). Other circuit courts hold, on the other hand, that rule of specialty objections can be raised only by the sending nation, not the individual defendant. See, e.g., United States v. Suarez, 791 F.3d 363, 366-67 (2d Cir. 2015); United States ex rel. Saroop v. Garcia, 109 F.3d 165, 168 (3d Cir. 1997). Some of the remaining circuits take the middle ground, allowing the defendant to raise a rule of specialty claim unless the sending nation consents to the deviation, while others still have not expressed an opinion. See Stokes, 726 F.3d at 889 (collecting cases). See note 40 infra.

³⁶ This risk is particularly acute for clients who are likely to become co-operating witnesses or plead guilty, as US authorities typically view resisting extradition as non-co-operation. For this reason, it is not uncommon for US authorities to require waiver of extradition as a precondition to co-operation or before they will even consider the client as a potential co-operating witness.

³⁷ Hedges, supra note 15, at 8-10.

³⁸ See Bruce Zagaris, U.S. Efforts to Extradite Persons for Tax Offenses, 25 Loy. L.A. Int’l & Comp. L. Rev. 653, 676 (2003) (US extradition treaties that entered into force prior to 1980 do not provide for waiver of extradition); see, e.g., Extradition Treaty, Austl.-U.S., 8 May 1976, 27 U.S.T. 957; France Extradition Treaty, supra note 19, art. 3(1).

³⁹ For instance, in the United Kingdom, local law provides several specified grounds for defending against extradition. See Extradition Act 2003, c. 41, §§ 81, 87, 13.

⁴⁰ Defences that may be available to a client upon arriving in the United States for trial typically are not available at the extradition stage. For example, the foreign judge presiding over the extradition proceeding may refuse to admit evidence supporting a defence of insanity or alibi, which may be raised as defences to the underlying substantive offences in the US criminal proceeding. See, e.g., Charlton v. Kelly, 229 U.S. 447, 462 (1913) (holding that the extradition magistrate properly excluded the evidence of insanity at the hearing stage); see also Shapiro v. Ferrandina, 478 F.2d 894, 901 (2d Cir. 1973). These defences are likely to be available only when the client arrives in the United States. Similarly, once a client has been extradited to the United States, he or she may assert the rule of specialty, which provides that defendants may be tried by the requesting state only for the specific offences for which extradition is granted. See United States v. Lopesierra-Gutierrez, 708 F.3d 193, 205–06 (D.C. Cir. 2013); United States v. Lomeli, 596 F.3d 496, 501 (8th Cir. 2010).

⁴¹ Criminal Resource Manual, supra note 6, § 603.

⁴² See, e.g., Extradition Treaty, Jordan-U.S., art. 2(4), 28 March 1995, S. Treaty Doc. No. 104-3; Extradition Treaty, Austria-U.S., art. 2(6), 8 January 1998, T.I.A.S. 12916; Extradition Treaty, Lux.-U.S., art. 2(1), 1 October 1996, T.I.A.S. 12804; Extradition Treaty, Hung.-U.S., art. 2(4), 1 December 1994, T.I.A.S. 97-318; Extradition Treaty, Bah.-U.S., art. 2(4), 9 March 1990, T.I.A.S. 94-922; France Extradition Treaty, supra note 19, art. 2(4).

⁴³ See, e.g., UK Extradition Treaty, supra note 18, art. 2(1). This defence may be particularly relevant in the FCPA context, as many countries do not outlaw certain forms of payment to government officials that are prohibited as bribery under the FCPA. For example, in 2005, the US authorities indicted a Czech national residing in The Bahamas for participating in a scheme to bribe foreign government officials. Despite the existence of a U.S.-Bahamian extradition treaty, the Bahamian courts ruled that the defendant could not be extradited because the charges against him were for acts that, if committed in the Bahamas, would not constitute a crime. See Superintendent of Her Majesty’s Foxhill Prison & U.S. v. Kozeny, Privy Council Appeal No. 0073, § 53 (Judicial Comm. of the Privy Council 28 March 2012) (Bah.).

⁴⁴ Justice Manual, supra note 6, §§ 9-15.240, 9-15.250.

⁴⁵ Id. § 9-15.240.

⁴⁶ These defences typically can be raised only where the applicable treaty specifically provides for such defences. See In re Extradition of Chan Seong-I, 346 F. Supp. 2d 1149, 1157 (D.N.M. 2004); United States v. Neely, 429 F. Supp. 1215, 1225 n.9 (D. Conn. 1977); Michael John Garcia & Charles Doyle, Cong. Research Serv., 98-958, Extradition to and from the United States: Overview of the Law and Recent Treaties 15–16 (2010), https://fas.org/sgp/crs/misc/98-958.pdf (citing extradition treaties that include provisions addressing lapse of time); UK Extradition Treaty, supra note 18, arts. 2, 5, 6; In re Ryan, 360 F. Supp. 270, 275 (E.D.N.Y. 1973), aff’d, 478 F.2d 1397 (2d Cir. 1973).

⁴⁷ See, e.g., UK Extradition Treaty, supra note 18, art. 7.

⁴⁸ For instance, in May 2019, a Dutch court suspended the extradition of an individual to the United Kingdom due to ‘inhuman or degrading’ conditions in a British prison. See Kaya Burgess & Jonathan Ames, Dutch court refuses extradition to UK’s ‘inhumane’ prisons, The Times (11 May 2019), https://www.thetimes.co.uk/article/dutch-court-refuses-extradition-to-uk-s-inhumane-prisons-w9dvjkqpm.

⁴⁹ Jennifer Piel et al., Determining a Criminal Defendant’s Competency to Proceed With an Extradition Hearing, 43 J. Am. Acad. Psychiatry & L. 201, 202-03 (June 2015), http://jaapl.org/content/jaapl/43/2/201.full.pdf.

⁵⁰ In 2001, for example, the Supreme Court of Canada ruled that it would not extradite two individuals who allegedly confessed to a brutal triple murder unless the Canadian government received assurances that the individuals would not be subject to the death penalty in the United States. Canada is entitled to seek such assurances under its extradition treaty. Extradition Treaty, Canada-U.S., art. 6, March 22, 1976, 27 U.S.T. 983.

⁵¹ Collins v. Miller, 252 U.S. 364, 369 (1920) (‘proceeding before a committing magistrate in international extradition is not subject to correction by appeal’); In re Mackin, 668 F.2d 122, 127-28 (2d Cir. 1981) (citing over a dozen cases holding the same).

⁵² In the United Kingdom, for example, extradition decisions are appealable by both the individual and requesting state. Extradition: processes and review, Gov.UK, https://www.gov.uk/guidance/extradition-processes-and-review#extradition-from-the-uk-category-2-territories.

⁵³ See Collins v. Loisel, 262 U.S. 426, 429 (1923) (holding that double jeopardy does not apply to extradition decisions).

⁵⁴ Renewed requests are generally heard by a different judicial officer and reviewed de novo. See Ahmad, 910 F.2d 1063, 1065 (2d Cir. 1990); In re Extradition of Mackin, 668 F.2d 122, 137 n.20 (2d Cir. 1981); Hooker v. Klein, 573 F.2d 1360, 1369 (9th Cir. 1978); In re Gonzalez, 217 F. Supp. 717, 720 (S.D.N.Y. 1963). Subsequent extradition requests may be based exclusively on evidence submitted in the initial request or supplemental evidence. See, e.g., Hooker, 573 F.2d at 1366 (government’s renewal of its extradition request was valid despite its first request being ‘denied following an extensive evidentiary hearing and full consideration of the merits of the case by an extradition court’); accord Mirchandani v. United States, 836 F.2d 1223, 1226 (9th Cir. 1988); In re Extradition of Tafoya, 572 F. Supp. 95, 97 (W.D. Tex. 1983); cf. Ahmad v. Wigen, 726 F. Supp. 389, 397 (S.D.N.Y. 1989), aff’d 910 F.2d 1063 (2d Cir. 1990); see also Ntakirutimana v. Reno, 184 F.3d 419, 423 (5th Cir. 1999); In re Extradition of Mackin, 668 F.2d 122, 137 n.20 (2d Cir. 1981).

⁵⁵ See 28 U.S.C. § 2241; see, e.g., Ahmad, 910 F.2d at 1065 (‘An extraditee’s sole remedy from an adverse decision is to seek a writ of habeas corpus; the Government’s sole remedy is to file a new complaint.’). The scope of habeas review is narrower than traditional appellate review and essentially limited to three inquiries: (1) the adequacy of the trial judge’s jurisdiction; (2) whether the offence is covered by the relevant treaty; and (3) whether there was sufficient evidence to support probable cause. John T. Parry, The Lost History of International Extradition Litigation, 43 Va. J. Int’l L. 93, 97 (2002).

⁵⁶ Criminal Resource Manual, supra note 6, § 622.

⁵⁷ The writ of habeas corpus may be filed before an individual is extradited to the United States. However, the DOJ takes the view that ‘[t]he filing of the [habeas] petition does not automatically stay further proceedings, and in certain cases the government may go forward with the extradition if the proceedings are not stayed by the order of the [US federal] court.’ Criminal Resource Manual, supra note 6, § 622.

⁵⁸ U.S. Dep’t of State, 2019 Treaties and Agreements, https://www.state.gov/2019-TIAS/.

⁵⁹ Among others, the United States was successful in extraditing an individual from Kosovo under the new extradition treaty with that state for his alleged involvement in a multimillion-dollar securities fraud. See U.S. Dep’t of Justice press release, ‘Manhattan U.S. Attorney Announces Extradition of Kosovar Man for Securities Fraud Offenses’ (26 August 2019), https://www.justice.gov/usao-sdny/pr/manhattan-us-attorney-announces-extradition-kosovar-man-securities-fraud-offenses.

⁶⁰ Mr Assange continues to fight the extradition case, which is expected to last years. See supra note 32; Isaac Stanley-Becker & William Booth, Julian Assange, expelled from his embassy perch, will fight extradition from jail, Washington Post (12 April 2019), https://www.washingtonpost.com/world/europe/julian-assange-expelled-from-his-embassy-perch-will-fight-extradition-from-jail/2019/04/12/d388584c-5cb2-11e9-98d4-844088d135f2_story.html. While the particular defences Mr Assange intends to raise are yet unknown, it is likely that he will argue, at a minimum, that the charges against him are political, rather than criminal, and therefore extradition would violate the U.S.-U.K. extradition treaty. Lauren Said-Moorhouse & Muhammad Darwish, Julian Assange starts extradition fight from UK prison, CNN (2 May 2019), https://www.cnn.com/2019/05/02/uk/julian-assange-extradition-fight-gbr-intl/index.html; see U.K. Extradition Treaty, supra note 18, art. 4(1). (‘[E]xtradition shall not be granted if the offense for which extradition is requested is a political offense.’).

⁶¹ For example, in May 2019, a Malaysian national previously arrested in Malaysia waived extradition and made his first appearance in US federal court to face charges for conspiring to engage in a multibillion-dollar money laundering scheme and violate the FCPA by bribing foreign public officials to embezzle billions of dollars from 1MDB, Malaysia’s sovereign wealth fund. See U.S. Dep’t of Justice press release, ‘Former Banker Extradited from Malaysia to United States to Face Charges in Multi-Billion Dollar Money Laundering and Bribery Scheme Relating to the 1MDB Fund’ (6 May 2019), https://www.justice.gov/opa/pr/former-banker-extradited-malaysia-united-states-face-charges-multi-billion-dollar-money. Notably, the Malaysian authorities have described the defendant’s extradition to the United States. as a ‘temporary surrender’ so that they might later pursue charges for similar conduct brought against him in Malaysia. See Matthew Goldstein, Former Goldman Sachs Banker Pleads Not Guilty in Malaysia Fraud Case, N.Y. Times, 6 May 2019 at B3, https://www.nytimes.com/2019/05/06/business/goldman-sachs-roger-ng-1mdb.html.

⁶² See generally U.S. Dep’t of Justice & U.S. Sec. Exch. Comm’n, A Resource Guide to the U.S. Foreign Corrupt Practices Act 11 (14 November 2012); see also Should FCPA ‘Territorial’ Jurisdiction Reach Extraterritorial Proportions?, Am. Bar Ass’n, (8 November 2018), https://www.americanbar.org/groups/international_law/publications/international_law_news/2013/winter/should_fcpa_territorial_jurisdiction_reach_extraterritorial_proportions/.

⁶³ Under federal law, a ‘witness’ is someone who authorities believe has information about facts relevant to a criminal investigation and that assist prosecutors in obtaining indictments against other individual or companies. A ‘subject,’ by contrast, is a ‘a person whose conduct is within the scope of the grand jury’s investigation,’ i.e., someone who engaged in activity or conduct at issue in the prosecutor’s investigation, but who the prosecutor has not yet determined participated in criminal activity. A ‘target’ is ‘a person as to whom the prosecutor or the grand jury has substantial evidence linking him to the commission of a crime and who, in the judgment of the prosecutor, is a putative defendant.’ Justice Manual, supra note 6, § 9-11.151.

⁶⁴ The government often relies on co-operating witnesses in white-collar cases, both during the investigatory phase and also at trial, e.g., to explain otherwise complicated and document heavy cases. See, e.g., Kastigar v. United States, 406 U.S. 441, 446 (1972) (‘[M]any offenses are of such a character that the only persons capable of giving useful testimony are those implicated in the crime.’) Individual co-operators tend to be lower-level employees or those who are less culpable in the criminal conduct. In particularly complex white-collar cases, the government may rely on more culpable individuals to co-operate against the primary target of an investigation or a company involved in a criminal scheme.

⁶⁵ During the attorney proffer, counsel should explain to the government counsel’s understanding of how the client was involved in the conduct under investigation and outline the information the client will be able to provide to the government. The attorney proffer is a critical opportunity to assess how the government is likely to react to the client’s testimony, identify potential risk areas, and potentially learn more about the government’s evidence and theory of the case depending upon the prosecutors’ questions and reactions.

⁶⁶ The proffer agreement typically includes a provision that the government will not use statements made during the interview directly against the client. See United States v. Rosemond, 841 F.3d 95, 109–10 (2d Cir. 2016). However, the government may use the statements for other purposes, e.g., as a lead to obtain other evidence or, if the client later testifies at trial in his own defence, the government can usually offer into evidence contradictory statements made during proffer sessions.

⁶⁷ Section 5K1.1 of the US Sentencing Guidelines enables the government to make a motion to allow the court to sentence a defendant below the applicable Sentencing Guidelines range. See Federal Sentencing Guidelines Manual § 5K1.1. In such motions, the government typically will set forth the nature, usefulness and significance of the client’s assistance during the proffer process. To receive credit for substantial assistance, the client will at a minimum need to be fully transparent about his own illicit conduct and to provide information about other people involved in the criminal activity. The client may also be required to produce documents, participate in investigatory operations (e.g., wearing a wire to record conversations with other defendants or targets), or testify before a grand jury or at trial. Importantly, a 5K1.1 letter is no guarantee of a favourable or reduced sentence, as the court retains discretion to impose a sentence up to the statutory maximum. See Federal Sentencing Guidelines Manual § 5K1.1 (2018) (explaining that a court ‘may depart from the guidelines’ in the case of a defendant’s substantial assistance to authorities) (emphasis added).

⁶⁸ A DPA sets out certain conditions that must be met before charges in the indictment will be dropped. Such conditions typically include a fine, term of supervision by pretrial services, or community service. DPAs are typically available only after the client has provided substantial co-operation, including potentially acting as an informant. See, e.g., Enforcement of the FCPA – Criminal Procedures – Deferred Prosecution Agreements, 13 Bus. & Com. Litig. Fed. Cts. § 134:34 (4th ed.).

⁶⁹ See Federal Sentencing Guidelines Manual § 5K1.1(5).

⁷⁰ To obtain an NPA, the client usually must pay a fine and co-operate with the government. In exchange, the relevant agency will refrain from filing criminal or civil charges. In deciding whether to enter into an NPA, DOJ policy provides that prosecutors should balance the cost of forgoing prosecution with the need for the co-operation to the public interest. Justice Manual, supra note 6, § 9-27.600 (2018).

⁷¹ It is now commonplace for employers to write into employment agreements and internal policies a requirement that employees co-operate in internal investigations. Failure to do so can be grounds for disciplinary action, including suspension without pay or termination. It may be necessary to engage employment counsel to advise the client on co-operation obligations under relevant employment agreements, policies or labour law in the relevant jurisdiction.

⁷² Clients should be made aware that, even where no formal or legally enforceable co-operation obligation exists, employers may withhold deferred compensation or post-employment remuneration to incentivise co-operation with an internal investigation.

⁷³ Garrity v. New Jersey, 385 U.S. 493, 497 (1967); see also United States v. Connolly, No. 16 CR. 0370 (CM), 2019 WL 2120523, at *10 (S.D.N.Y. 2 May 2019).

⁷⁴ Connolly, 2019 WL 2120523, at *14.

⁷⁵ See id. at *11-14. On the other hand, if the company acted entirely on its own, the resulting statements are not ‘compelled’ by state actors within the meaning of the Fifth Amendment and are therefore freely usable by the government at any later point in time.

⁷⁶ For example, counsel should carefully assess whether co-operation will increase the risk that a parallel criminal action is brought against the client by US prosecutors or by civil authorities in a foreign jurisdiction in which the client is licensed or regulated.

⁷⁷ Company counsel likely will inform the client accordingly in an Upjohn warning at the beginning of any interview. See Upjohn, 449 U.S. 383, 394 (1981); Model Rules of Prof’l Conduct r. 1.13(f), 4.3. Counsel should similarly advise clients, particularly where they may provide information that could be used against them in a future enforcement proceeding.

⁷⁸ The company may even decide to turn over the notes or summaries of the interview, or may be required to do so under the laws of the relevant jurisdiction.

⁷⁹ See Statement of Principle and Code of Practice for Approved Persons, U.K. Fin. Conduct Auth., § 2.1A.3 (September 2019), https://www.handbook.fca.org.uk/handbook/APER.pdf (Statement of Principle 4 provides that ‘[a]n approved person must deal with the FCA, the PRA and other regulators in an open and cooperative way and must disclose appropriately any information of which the FCA or the PRA would reasonably expect notice’) (emphasis in original).

⁸⁰ See, e.g., infra note 81.

⁸¹ U.S. Const. amend. V; see United States v. Saechao, 418 F.3d 1073 (9th Cir. 2005).

⁸² United States v. Allen, 864 F.3d 63 (2d Cir. 2017) (reversing convictions of two Rabobank traders who provided testimony to the UK’s Financial Conduct Authority (FCA) in an investigation into LIBOR manipulation under threat of prosecution for non-cooperation under UK law, because the Fifth Amendment ‘prohibits the use and derivative use of such compelled testimony in an American criminal case against the defendant who provided that testimony’).

⁸³ The United States has entered into MLATs or similar bilateral agreements with approximately
70 states allowing it to enlist the investigatory authority of those states to procure evidence. See
Mark A Rush and Jared A Kephart, Lifting the Veil on the MLAT Process: A Guide to
Understanding and Responding to MLA Requests (20 January 2017), http://m.klgates.com/
lifting-the-veil-on-the-mlat-process-a-guide-to-understanding-and-responding-to-mla-requests
-01-20-2017/. In addition, the United States is party to an agreement with the European Union that enhances mutual legal assistance mechanisms with EU Member States. See Mutual Legal Assistance Treaty, European Union-U.S., 16 January 1998, T.I.A.S. 12923. The DOJ’s OIA, together with the Department of State, negotiates and implements MLATs, administers mutual legal assistance operations, and coordinates incoming and outgoing requests. Notably, unlike extradition treaties, MLATs generally do not require dual criminality.

⁸⁴ See United Nations, Manual on Mutual Legal Assistance and Extradition (September 2012), https://www.unodc.org/documents/organized-crime/Publications/Mutual_Legal_Assistance_Ebook_E.pdf. For this reason, a request for mutual legal assistance to a foreign authority is often accompanied by a petition to a US court under 18 U.S.C. § 3292 to suspend the running of the statute of limitations during the pendency of a request. A court will grant the request if it finds by a preponderance of the evidence that an official request has been made and it reasonably appears that the evidence is or was in a foreign country. See, e.g., T Markus Funk, Federal Judicial Center International Litigation Guide: Mutual Legal Assistance and Letters Rogatory: A Guide for Judges 15 (2014), https://www.fjc.gov/sites/default/files/2017/MLAT-LR-Guide-Funk-FJC-2014.pdf.

⁸⁵ See also Model Rules of Prof ’l Conduct r. 1.13 cmt. (Am. Bar Ass’n 2018) (providing that investigating counsel should advise employees whose interests may be adverse to the corporation that he or she ‘may wish to obtain independent representation’).

⁸⁶ Counsel should also bear in mind that US authorities may take a dim view of joint representation, questioning the independence of the client’s testimony or, at the most extreme, alleging that a conflict has arisen and insisting that independent counsel be retained.

⁸⁷ While ‘[a]n employee’s cooperation in an internal investigation alone is not sufficient to establish a common interest’, the privilege will be deemed waived where there is ‘some form of joint strategy’ among the parties. In re Grand Jury Subpoena: Under Seal, 415 F.3d 333, 341 (4th Cir. 2005) (quoting United States v. Weissman, 195 F.3d 96, 100 (2d Cir.1999)); see also United States v. Aramony, 88 F.3d 1369, 1392 (4th Cir. 1996) (‘To be entitled to the protection of this privilege the parties must first share a common interest about a legal matter.’). Furthermore, it has become increasingly common for companies to include in joint defence agreements language that expressly allows the company to unilaterally disclose joint defence materials and information to other parties to the representation. See Ed Magarian and Surya Saxena, ‘Joint Defense Agreements: What Is A Responsible Company To Do?’, 22 Andrews Corp. Officers and Directors Liability Litig. Rep., September 2008, at 1 (2008).

⁸⁸ In both pool and company counsel representations, counsel will need to obtain the client’s consent to disclose confidential information to others in the pool and ‘use’ such information for the benefit of other clients (while maintaining the privilege to outside parties) under the joint defence privilege. Engagement letters also should clearly explain that pool counsel may use information provided by one client to zealously represent all clients in the pool (though information identified by a client as being confidential will only be shared with express authorisation). Relatedly, clients should be advised not to speak with any third parties about the substance of the investigation to preserve the integrity of the respective clients’ recollections, and also because those communications will not be protected by the common interest or joint defence privilege. See, e.g., United States v. Austin, 416 F.3d 1016, 1021 (9th Cir. 2005) (joint defence privilege protects the confidentiality of communications ‘passing from a party to his or her attorney’ and ‘from one party to the attorney for another party’, but only ‘where a joint defense effort or strategy’ exists) (quoting United States v. Schwimmer, 892 F.2d 237, 243 (2d Cir. 1989)).

⁸⁹ In China, for example, there is no doctrine of legal privilege. Richard Bartlett and Yuan Min, A Lawyer’s guide to working in China, King & Wood Mallesons (15 November 2017), https://www.kwm.com/en/knowledge/insights/a-lawyers-guide-to-working-in-china-20171113. And while the European Union provides for the ‘legal professional privilege’, it is comparatively limited, covering only counsel who are admitted to the bar in one of the Members States of the European Union. Patrick Doris and Steve Melrose, Privilege: European Union, Global Investigations Review. (12 October 2018), https://globalinvestigationsreview.com/preview_jurisdiction/1005270/european%20union?preview=1000391.

⁹⁰ Cadence Pharm., Inc. v. Fresenius Kabi USA, LLC, 996 F. Supp. 2d 1015, 1019 (S.D. Cal. 2014). The country with the ‘predominant interest’ is either ‘the place where the allegedly privileged relationship was entered into’ or ‘the place in which the relationship was centered at the time the communication was sent.’ Id.

⁹¹ See, e.g., Swidler & Berlin v. United States, 524 U.S. 399, 408 (1998); see also Doug Gallagher, Manasi Raveendran, Attorney–Client Privilege for in-House Counsel, Am. Bar Ass’n (2017), https://www.americanbar.org/groups/intellectual_property_law/publications/landslide/2017-18/november-december/attorney-client-privilege-inhouse-counsel/. Privilege issues arise more often in the context of communications with in-house rather than external counsel because, for example, in-house counsel may often play the dual role of offering both legal and business advice.

⁹² Ava Borrasso, Privilege and International Implications against the Backdrop of the Panama Papers, Am. Bar Ass’n (20 July 2016), https://www.americanbar.org/groups/business_law/publications/blt/2016/07/12_borrasso/.

⁹³ The GDPR imposes certain obligations on individuals, organisations and companies who are ‘controllers’ or ‘processors’ of personal data and restricts how they may process and transfer that data. If the controller or processor wishes to transfer the data to a country the European Commission has not deemed adequate, such as the United States, it must identify whether a sufficient basis, or ‘derogation’, applies under the GDPR and implement safeguards to ensure GDPR compliance. One such derogation applies when the transfer is necessary for the establishment, exercise or defence of legal claims, which commonly applies in the context of criminal or other regulatory investigations, where transfer of data is necessary for the purpose of defending the individual client. See European Data Protection Board, Guidelines 2/2018 on derogations of Article 49 under Regulation 2016/679, 11 (25 May 2018), https://edpb.europa.eu/sites/edpb/files/files/file1/edpb_guidelines_2_2018_derogations_en.pdf.

⁹⁴ See, e.g., Schweizerisches Strafgesetzbuch (Swiss Criminal Code), 21 December 1937, art. 349.

⁹⁵ See, e.g., Loi 80-538 du 16 juillet 1980 relative à la communication de documents et renseignements d’ordre économique, commercial ou technique à des personnes physiques ou morales étrangères (Law 80-538 of 16 July 1980 Relating to the Communication of Economic, Commercial or Technical Documents or Information to Foreign Natural or Legal Persons), Journal Officiel de la République Française, 17 July 1980, art. 1A (Fr.).

⁹⁶ See, e.g., Swiss Criminal Code 21 December 1937, SR 757 (1938), as amended by Gesetz, 4 October 1991, AS 2465 (1992).

⁹⁷ The law is not entirely settled on this issue. The critical inquiry is whether (1) the materials were created or maintained in the course of employment, and (2) the employee had a reasonable expectation of privacy with respect to the materials. See, e.g., Smyth v. Pillsbury Co., 914 F. Supp. 97, 101 (E.D. Pa. 1996) (no reasonable expectation of privacy in email communications made voluntarily over company email system even where employer told employees electronic communications would be kept confidential); but see Levanthal v. Knapek, 266 F.3d 64, 73 (2d Cir. 2001) (public employee had reasonable expectation of privacy in contents of office computer because, inter alia, employee occupied private office with closed door and had exclusive use of desk, filing cabinet and computer); Kellher v. City of Reading, No. CIV.A.01-3386, 2002 WL 1067442, at *1 (E.D. Pa. 29 May 2002) (acknowledging that employee may have reasonable expectation of privacy in certain company email communications depending on the communication at issue and configuration of the relevant email system).

⁹⁸ Note, however, that the client may have a cognisable claim that the materials are protected by the attorney–client or other applicable privilege. See e.g., Sims v. Lakeside School, No. C06-1412RSM, 2007 U.S. Dist. LEXIS 69568 (W.D. Wash. 20 September 2007).

⁹⁹ Even where a company has not requested materials, it is prudent to advise clients to preserve any emails, notes or other documents that they believe may bear on the investigation. To assure adequate preservation, it may be necessary to engage a reputable third-party forensic technician to image or otherwise preserve the documents or data in question.

¹⁰⁰ Former employees may claim an ‘act of production’ privilege in refusing to produce documents ‘where the act of production is, itself, (1) compelled, (2) testimonial, and (3) incriminating.’ In re Three Grand Jury Subpoenas Duces Tecum Dated Jan. 29, 1999, 191 F.3d 173, 178 (2d Cir. 1999). It is not clear, however, how a court might rule where the documents in the former employee’s possession are deemed to be the company’s property, e.g., where the employee took the documents upon leaving the employer without permission and/or in violation of company policy. But see id. at 182-83.

¹⁰¹ In Braswell v. United States, 487 U.S. 99, 102 (1988), the Supreme Court held that current employees may not claim the act of production privilege, even if those documents are incriminating against the employee, because the employee is an agent of the company and the records were in the employee’s custody in his capacity as an agent. The Court did not address whether the outcome might differ if the records in question were personal to the employee or not maintained in his capacity as an agent of the company. In light of Connolly, former employees in an internal investigation conducted at the behest of the government might have an argument that the act of production privilege applies to them as well.

¹⁰² See, e.g., 18 U.S.C. §§ 981, 982; 21 U.S.C. § 853.

¹⁰³ See Fed. R. Crim. P. 32.2(a).

¹⁰⁴ See 18 U.S.C. §§ 982(a), 1963(e); Fed. R. Crim. P. 32.2(b)(1)(A).

¹⁰⁵ See 18 U.S.C. §§ 983(a)(4), 984(a)(1), 985(c); see also 18 U.S.C. § 983(a)(1); 19 U.S.C. § 1607.

¹⁰⁶ Id. § 985(b)(1).

¹⁰⁷ Id. § 983(j). The government must have probable cause to believe the property constitutes proceeds of crime or was used during the commission of a crime. See 21 U.S.C. 853(e)(2). An indictment returned by a proper grand jury ‘conclusively determines the existence of probable cause’. Kaley v. United States, 571 U.S. 320, 328 (2014) (citing Gerstein v. Pugh, 420 U.S. 103, 117 n.19 (1975)).

¹⁰⁸ SEC v. One or More Unknown Traders in the Securities of Onyx Pharmaceuticals, Inc., 296 F.R.D. 241, 254 (S.D.N.Y. 2013) (citing SEC v. Unifund SAL, 910 F.2d 1028, 1041 (2d Cir. 1990)).

¹⁰⁹ 21 U.S.C. § 853(p).

¹¹⁰ See, e.g., United States v. Butler, 543 F. App’x 95, 97 (2d Cir. 2013).

¹¹¹ The United States is a party to a number of treaties, as well as other formal and informal agreements, that provide for freezing or seizure of assets in foreign jurisdictions. See, e.g., U.S. Internal Revenue Service, Internal Revenue Manual § 9.7.10.1.2 (28 July 2003), https://www.irs.gov/irm/part9/irm_09-007-010#idm140235861363504. In addition, US authorities (and private civil litigants) may register seizure or forfeiture orders issued by US courts in foreign jurisdictions in hopes of enforcing those judgments abroad. See, e.g., Mutual Legal Assistance Treaty, U.S.-U.K., art. 19(2) 6 January 1994, T.I.A.S. No. 96-1202.

¹¹² For example, in 2019, the DOJ announced the filing of a third round of civil forfeiture complaints in the 1MDB prosecution, bringing the total seizure amount over $1.5 billion.  See U.S. Dep’t of Justice press release, ‘Former Banker Extradited from Malaysia to United States to Face Charges in Multi-Billion Dollar Money Laundering and Bribery Scheme Relating to the 1MDB Fund’ (6 May 2019), https://www.justice.gov/opa/pr/former-banker-extradited-malaysia-united-states-face-charges-multi-billion-dollar-money; see also supra note 61.

¹¹³ Reputational concerns are likely to be heightened when the proceeding is high profile and the client faces media inquiries. While clients may wish to hire a public relations firm, any decision to engage a third party should be carefully considered in light of the fact that those communications are often not privileged and could adversely affect the outcome of the proceeding. See, e.g., Haugh v. Schroder Inv. Mgmt. N. Am. Inc., 02-7955, 2003 WL 21998674, at *3 (S.D.N.Y. 25 August 2003).