Question: When companies realise they have a corruption and/or compliance issue – who should they call?
Answer: The person who can serve them best.
Admittedly a rather simplistic answer to a more complex question, but in truth the reality is that simple. These two professions obviously have advantages specific to their skill set, and the best solution is to identify the exact nature of your compliance and corruption problem and then hire the appropriate professionals. Obviously depending on the particular nature of the case, it could be wise to actually employ both, but ensure each is approaching the problem from the angle that best suits their skills.
So why a lawyer over an accountant? Lawyers are obviously trained to understand and interpret the law and to evaluate evidence; all of which are essential skills when dealing with accusations from, for example, the World Bank that a company or its employees have engaged in fraudulent or corrupt practices on Bank financed contracts. But what truly sets lawyers apart from other professionals, such as accountants or former law enforcement officers, is that Legal Professional Privilege (LPP) attaches to communications between them and their clients. LPP means that communications between a client and his lawyer in respect of giving or receiving legal advice cannot be disclosed by the lawyer in the absence of the client’s permission; such communications are in general sacrosanct. In contrast, communications between a client and his accountant or for that matter any professional other than a lawyer are not privileged and may result in the non-lawyer having to disclose or report to others what he finds.
The benefits of LPP are multi-fold, but primarily this privilege engenders free-flowing communication between all parties involved, which helps speed up resolution and ensures confidentiality. This ability to have honest and open discussions should not be under-valued, as it is vital to a company’s future success, as it fast-tracks problem solving and putting the appropriate procedures in place to limit any further corruption within the company.
Accountants and former law enforcement officers are of course vital resources at times, they are highly skilled at flagging up suspicious transactions, accounts and offices, and can also assist in improving a company’s compliance programme. Yet the ability to talk freely is probably the strongest tool a company has for uncovering and fixing any corruption issues they might have, and without it the consequences could prove to be a lot more serious.
In short, when faced with corruption and compliance issues emanating from the multilateral development banks, such as the World Bank Group, go to a lawyer who specialises in the relevant field, such as those found within Bretton Woods Law.