Last week, we saw the news that Volkswagen is setting aside €6.5bn (£4.7bn) to cover costs of the rigged US car emissions tests scandal and faces potential fines estimated up to $18bn.The automotive sector is under fierce pressure from consumers and regulators. Regulatory authorities worldwide have launched over 100 investigations into the activities of car manufacturers and/or companies producing components used in car manufacture.
The importance of consumer confidence in the automotive industry remains so high that many spokespersons are calling for more investigations and the implications can be wide-ranging. Not only will automobile manufacturers themselves be at risk but investigations can also look into the activities of third parties and suppliers. Given the size of the industry, this represents a significant number of businesses placed under regulatory scrutiny.
What happens in an investigation?
Regulators will be looking for evidence of misconduct. In most cases, this evidence will be found within electronic and paper documents. Therefore, the first step in many investigations will be a dawn raid on a company’s premises where agents will seize electronic devices such as laptops, computers and phones as well as taking copies of data from servers and the Cloud. They may also take paper documents. The regulator will then examine this evidence as part of the investigation.
At this stage, companies involved in the automotive industry should consider their exposure to issues raised in the Volkswagen scandal (e.g. methods of measuring fuel emissions) . Companies should also think in a wider context with regards to risk. For example, although a regulator may initially be investigating a specific issue, in this case regarding falsification of fuel emission reports, they will not turn a blind eye to other forms of misconduct. Investigations into one product or issue can unearth evidence of other issues which need to be investigated and potentially reported.
If a company thinks there is even a small risk of any kind of wrongdoing, we would advise taking precautionary measures sooner rather than later. As mentioned earlier, regulators may conduct an unannounced visit. They may also request the submission of large volumes of data with very short deadlines which can be very difficult to meet without expert help from a legal technology provider.
How can an ediscovery expert help?
Whether a company is proactively conducting an internal investigation or is undergoing a regulatory investigation, using an ediscovery provider can give an advantage by:
- Establishing what issues the company faces
Kroll Ontrack’s case managers and electronic evidence consultants are experts in assisting with regulatory investigations. Using advanced tools such as predictive coding, they can analyse emails, instant messages, and dozens of other types of office document. Any ‘hot documents’ or data custodians who are exhibiting suspicious behaviour can be quickly identified, allowing companies to take appropriate action in a timely manner.
- Identifying irregularities
Not all misconduct is uncovered in communications data such as email. Our structured data consultants are able to use analytics tools to examine financial, operational and transactional data to uncover irregularities that may otherwise be hiding behind big data.
- Collecting and preserving important evidence
Evidence is precious and inexpert handling can mean evidence is rejected in court (for example if original metadata was altered during collection). Kroll Ontrack’s digital forensics experts gather electronic evidence and materials in a forensically sound manner, ensuring all data collected is ready for use in an investigation.
We have data centres throughout the world and mobile solutions, meaning evidence can be stored securely and in accordance with data protection laws no matter where in the world it is located.
- Presenting project plans to the board, regulators or other relevant third parties
Consultancy is a key part of the service at Kroll Ontrack. Our legal consultants can provide advice and strategy to the board. We are also able to collaborate with regulators where necessary, often negotiating extensions to deadlines or a more favourable investigatory scope.
- Providing qualified lawyers and/or paralegals to conduct first level relevance reviews.
With tight deadlines and often specialist technical knowledge required, it can be difficult for law firms to assemble teams of document reviewers with the right skills to conduct document reviews. Kroll Ontrack retains a pool of high-calibre, multilingual document review lawyers with experience across all industrial sectors, ready to be deployed at very short notice.
Robert Jones is the manager of Kroll Ontrack’s team of Legal Consultants in Continental Europe, the Middle East and Africa.