Special Focus: White Collar Crime
“
In 2006, the work in our practice area was
mainly taken up by criminal cases, but now
there’s almost a 50/50 split between these
cases and regulatory offences – and this is
increasing year-on-year.
Paulo de Sá e Cunha
Cuatrecasas, Gonçalves Pereira, Lisbon
”
As the demand for compliance and in-depth awareness
of legal limits now extends to every aspect of business, this
has resulted in a trend for legislation that’s increasingly
complex, diverse and punitive. By way of response, law
firms are not only increasing their litigation practices but
employing multidisciplinary teams from every practice
area – corporate, tax, administrative, labour, criminal – to
cut through the complexity of a single activity potentially
violating a number of different laws.
Many lawyers in Spain believe that there is some way to
go to iron out the idiosyncrasies in a legal system that has
contradictory acts within the practice of public prosecution
based on what the law wants versus what the politician
wants. T his has led some lawyers to believe that such
legislation is politically motivated, to show that criminal
offences are serious offences and that while discovering
fraud is difficult, it is possible to avoid trial. However,
others think this tougher line is down to the pressure
to raise revenue by way of generating legitimate funds.
“This increase in tax fraud cases is down to the Authorities
being more active and dedicating more resources to push
through more cases,” explains Victor Mercedes, Co-Head of
the Litigation & White Collar Crime Litigation at Baker &
McKenzie, Barcelona.
However, many lawyers think that regardless of political
motivations, new compliance demands placed on businesses,
coupled with the increasingly centralised information
and streamlined formalities that now come with law and
tax obligations will change the perception of impunity in
Spain and Portugal. As demonstrated by some of these
long-running and high-profile white collar crime cases in
the public eye, to date there have been very few effective
convictions. “I think that the Portuguese Government is
trying to ensure that the simplification of the procedures
contributes to more cases to be initiated and concluded much
more quickly,” says Soares Machado at SRS Advogados.
Many companies in Spain, particularly within the SME
sector, are also now trying to understand the new legal
system – or what exactly ‘due control’ means – or asking
for advice to design, implement and adapt their own
compliance programme.
Lawyers in general are sensing that their clients are
exercising a high degree of caution, at the cost of it hindering
their business. “Clients are still reluctant to engage in
54 • IBERIAN LAWYER • January / February 2014
preventive compliance audits, because
of the costs involved,” says Rui Patricio,
a Litigation and Arbitration Partner at
Morais Leitão, Galvão Teles, Soares da
Silva. “But as soon as suspicions are raised
they initiate their internal investigations
and then they want their lawyers involved
right from the start.”
Compliance and crime
Cross-border protection from white collar
crime is increasingly top of the agenda as
both Portuguese and Spanish Governments
attempt to protect businesses while still facilitating trade. Law
firms are coming across certain distinct types of client: those
with existing procedures that just want verification that their
policies comply before contracting with clients; multinationals
with subsidiaries in Portugal and Spain who need to adapt
their policies to new legislation; and, domestic companies who
want to check their foreign subsidiaries are in compliance with
laws around the world.
“We are also seeing an increase in foreign clients seeking
assistance in criminal proceedings pending in Portugal,”
says João Medeiros, Head of Criminal Law at PLMJ in
Lisbon, “as well as an increase request for legal advice on
foreign legislation”.
By way of highlighting the importance of international
cooperation between regulatory authorities, lawyers are
establishing channels with foreign law firms, particularly
in Portuguese-and Spanish speaking countries. “Over the
past few years, Spanish criminal courts and judges have
had to become acquainted with the legal mechanisms for
international mutual legal assistance,” says de Buerba at
Pérez-Llorca. “These instruments are no longer limited to
highly specialised courts such as the High Court, but have
become general practice.”
But while most large companies with international
business have already adopted (or are in the process
of adopting) compliance programmes that take into
consideration foreign anti-corruption legislation, lawyers
deem some of these policies as ‘harsh’ and not helped
by the challenges of establishing effective procedures for
internal investigations.
According to Carlos Bueren, Head of White Collar Crime
at Uría Menéndez, there is a growing concern among lawyers
from Spanish companies doing business in foreign countries
in relation to the US Foreign Corrupt Practices Act, US
sanctions regulation, and the extraterritorial implementation
of the UK Bribery Act, as well as the anti-corruption policy
adopted by institutions such as the World Bank.
Concerns aside, however, Iberian lawyers are
increasingly hopeful that the measures being taken to
combat white collar crime in both countries will bring
legal certainty to investors while also inspiring longterm confidence in the economy – and the increasingly
indispensable role of the lawyer.
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