White Collar Defense, Internal Investigations, & Regulatory Compliance

Internal Investigations

Independent internal investigations for boards, audit committees, and management, with full regulatory coordination capability.

Overview

When a board or audit committee needs an independent internal investigation (whether triggered by a whistleblower, a regulator inquiry, accounting irregularities, or executive misconduct), the choice of lead counsel determines the credibility of the process and the quality of the result. The investigation must be genuinely independent, factually rigorous, and legally privileged; the findings must be defensible to the SEC, DOJ, and outside auditors; and the process must be efficient enough to serve the company's business continuity needs.

Fridman Fels & Soto brings a rare combination of skills to this work. Michael Garcia brings ten years of White & Case experience leading Latin America investigations for audit committees of publicly traded companies, combined with CPA-level accounting and financial analysis capability. Daniel Fridman directed investigations that produced a $100 million financial restatement, presented evidence to U.S. prosecutors, and secured SEC enforcement closure without action. Neither attorney relies on intermediaries to work with auditors, forensic accountants, or financial experts; they engage directly, in depth.

The firm's investigations are managed as independent engagements separate from any defense work for the company, preserving the independence that gives the investigation its credibility with regulators. When investigation findings create government enforcement exposure, the defense team is on standby and can engage immediately.

Our Approach

We open every investigation with a privilege protocol, a document preservation and collection plan, and a scope definition agreed with the board or committee. These three decisions at the outset determine whether the investigation will be defensible and efficient, or expensive and problematic. Scope creep is the most common driver of investigation cost overruns; clear scope boundaries from day one prevent it.

Interview strategy is the heart of a good investigation. Witness preparation, sequencing, and credibility assessment require experienced trial lawyers who have cross-examined adverse witnesses and know how to build a factual record that will survive scrutiny. The firm's partners have collectively conducted hundreds of investigation interviews across multiple continents.

Findings are presented in a format appropriate to the audience: a detailed written report for the committee; a presentation for management and outside auditors; and, where government disclosure is appropriate, a coordinated voluntary disclosure to the relevant agency.

Representative Experience

White Collar & Government Investigations

Toshiba International Corporation internal investigation
Led an internal investigation for Toshiba International Corporation that traced a bribery and bid-rigging scheme in which a facilities manager steered more than $100 million in construction contracts to two favored companies in exchange for payments in cash, gold and silver bars, real estate, guns, jewelry, and watches, causing Toshiba a loss of more than $80 million, then filed a civil RICO suit in Houston in 2019 and presented the evidence to federal prosecutors; the perpetrators pled guilty and were sentenced to prison, one business owner to nine years in the Southern District of Texas.
Congressional inquiry into nonprofit organizations
Represent, pro bono under the firm's rule-of-law and democracy-protection initiative, four nonprofit organizations targeted in a Congressional inquiry into their use of federal funds.
Grand jury investigation involving national security issues
Assisted the corporation with its responses to grand jury subpoenas in a DOJ investigation involving national security issues.
DOJ antitrust price-fixing investigation; client cleared
Conducted a full internal investigation in response to government subpoenas in a DOJ antitrust price-fixing investigation, demonstrating the client's lack of involvement in the charged conspiracy; other individuals charged were subsequently acquitted. In a separate DOJ antitrust investigation of a former company officer, the firm's internal investigation led the DOJ to close its inquiry.
Public company audit-committee investigation
Engaged by a public company's CEO to assist an audit-committee investigation into allegations concerning personal-versus-business expenses.
Audit-committee FCPA internal investigation
Represented an audit committee in an internal investigation into alleged FCPA violations, including coordination with outside auditors on the committee's remediation and disclosure obligations.
Corporate-misconduct internal investigation
Led a corporate-misconduct investigation into kickbacks, asset misappropriation, and conflicts of interest at a corporate subsidiary.
House committee inquiry into immigration nonprofits
Co-led the pro bono representation, under the firm's rule-of-law initiative, of four nonprofit immigration-assistance organizations targeted in a House Committee on Homeland Security inquiry into the use of federal funds by more than 200 NGOs.
DOJ price-fixing probe of industry executives
Assisted on internal investigations connected to a DOJ price-fixing probe involving industry executives, work that helped establish a client's non-involvement.

Latin America & Cross-Border

Mexican oil-drilling company internal investigation
Conducted an internal investigation of accounting and internal-control deficiencies at a Mexican oil-drilling company.

Frequently Asked Questions

What is the attorney-client privilege in an internal investigation?

Communications between the investigation team and the company (including its officers and employees) in the course of a privileged internal investigation are protected by the attorney-client privilege. The privilege belongs to the company, not the individual employees; the company can waive it, and individual employees cannot assert it to block production to the company or its counsel. The Upjohn warnings given to employees at the start of an interview are designed to make this clear.

What is the difference between an independent investigation and a management investigation?

An independent investigation is conducted by counsel reporting directly to the audit committee or a special committee of independent directors, not to management. This independence is critical when the investigation involves potential misconduct by management and is required by many regulators and outside auditors before they will accept the investigation's findings. A management-directed investigation lacks this independence and its conclusions carry less weight with the SEC, DOJ, and outside auditors.

When is voluntary disclosure to the SEC or DOJ appropriate following an investigation?

Voluntary disclosure is appropriate when the investigation has uncovered conduct that creates reportable government enforcement exposure and the benefits of disclosure (reduced penalty, faster resolution, non-prosecution or deferred prosecution) outweigh the costs of self-reporting. The decision is company-specific and fact-intensive. The DOJ and SEC cooperation frameworks each offer specific benefits for timely, complete, and accurate voluntary disclosure. The analysis must account for disclosure obligations under securities law, which run in parallel.