by Evan Wright, Partner, Corporate, Professional & Regulatory at JMW Solicitors
Public inquiries in the UK are established to investigate matters of serious public concern. While the goal is primarily to uncover the facts surrounding an issue, a public inquiry can sometimes bring to light information that may lead to criminal investigations. For businesses involved in these inquiries, this possibility poses additional legal challenges. Understanding the potential for criminal liability can help businesses prepare and manage their risk effectively.
Understanding Public Inquiries in the UK
Public inquiries are often established in the UK following significant events or scandals, such as safety failures, public health issues, or instances of financial misconduct. These inquiries are formal investigations, usually led by an appointed chair who works under the Inquiries Act 2005. The objective of a public inquiry is to examine what happened, identify any failures that may have been responsible, and provide recommendations to prevent similar incidents in the future.
Public inquiries operate independently of criminal or civil proceedings. Although they are not established to determine guilt or enforce legal penalties, they can gather a vast amount of evidence, including documents, witness testimonies, and expert reports. The findings are generally published in a final report, which may be submitted to the government or other relevant authorities. While public inquiries are focused on establishing facts, they do have the power to uncover evidence of potential criminal activity, which can then be referred to law enforcement agencies for further investigation.
How Public Inquiries Can Lead to Criminal Investigations
Although public inquiries themselves do not have the authority to prosecute individuals or businesses, their findings can often lead to criminal investigations. If an inquiry uncovers evidence suggesting potential criminal conduct, the inquiry team may share this information with the police or other relevant authorities.
For businesses, this risk is particularly acute if the inquiry’s remit involves corporate practices or actions that fall under regulatory oversight. A public inquiry might reveal issues related to fraud, financial mismanagement, health and safety breaches, or environmental violations. If such evidence surfaces, it may prompt law enforcement agencies to consider criminal proceedings.
Legal Powers of Inquiry Chairs and Implications for Businesses
The chair of a public inquiry holds extensive powers to gather evidence. Under the Inquiries Act, they can compel businesses to provide documents, submit written statements, and give oral evidence. This requirement means businesses must disclose a wide range of potentially sensitive information, including internal records, communications, and financial documents.
For businesses, these disclosure powers can expose vulnerabilities. If the evidence shared reveals practices that might breach criminal laws, this could open the door to criminal investigations. The data and documentation provided might be scrutinised by law enforcement agencies looking for signs of illegal conduct. For example, a construction company called to an inquiry on workplace accidents might need to disclose health and safety records that could later indicate non-compliance with safety regulations.
The evidence-gathering phase is also often conducted publicly. If the inquiry is high profile, media coverage can amplify the impact of disclosures, potentially damaging the reputation of the business and increasing scrutiny from regulatory bodies and law enforcement agencies alike.
Considerations for Businesses Involved in Public Inquiries
Given the potential for a public inquiry to lead to criminal investigations, businesses should take several steps if they are called to participate. These steps can help prepare for the inquiry itself and mitigate the risk of any subsequent legal challenges.
Preparation and Compliance
Businesses must be diligent in their preparation. Legal representation is essential to ensure compliance with the inquiry’s demands while safeguarding the company’s interests. This includes preserving relevant documents, emails, and other records that may be required. Failure to disclose required information or withholding evidence can lead to contempt charges or additional legal consequences.
Conducting Internal Investigations
In some cases, businesses may wish to conduct their own internal investigations before an inquiry begins. This process can help the company understand the full scope of potential issues and proactively address any areas of concern. For example, if the inquiry relates to regulatory compliance, an internal review can identify any breaches that may need to be remedied or disclosed. Taking proactive steps in response to potential issues can also demonstrate to the inquiry that the business is committed to transparency and compliance.
Steps to Take if Criminal Liability is Suspected During an Inquiry
If, during the course of an inquiry, a business suspects that criminal liability could arise, seeking specialised legal advice is paramount. A business crime or regulatory lawyer can help navigate the inquiry process, particularly in relation to protecting against self-incrimination and managing disclosures that could have legal repercussions.
Legal Representation and Strategic Disclosure
Working with legal representatives throughout the inquiry can provide clarity on how to respond to specific requests for information. Legal counsel can also advise on strategic disclosure, ensuring the business complies with the inquiry’s requirements while minimising exposure to criminal liability. For example, while the inquiry may require full transparency, businesses should be careful about the manner in which they disclose sensitive information. Evidential integrity and context is very important.
Mitigating Legal Risks
In some cases, it may be prudent for businesses to engage in dialogue with law enforcement agencies before or during an inquiry. For example, cooperating fully and voluntarily disclosing relevant information could reduce the likelihood of a criminal investigation. However, these decisions should always be made with professional legal guidance, as they can have significant legal consequences.
Managing Post-Inquiry Risks
After an inquiry concludes, businesses should carefully review the inquiry’s findings and determine if any issues raised could lead to further scrutiny or criminal investigations. By preparing for these potential outcomes, businesses can respond quickly and effectively to any additional challenges.
Reputation Management
Inquiries often attract substantial public and media attention, which can impact a business’s reputation. Companies should have a communication strategy in place, including how to handle any press inquiries and engage with stakeholders. By controlling the narrative, businesses can mitigate some of the reputational damage that can arise from public disclosures.
Reviewing Compliance Policies and Procedures
A public inquiry often highlights gaps in existing policies and practices. Following an inquiry, businesses should take the opportunity to review their compliance frameworks and make any necessary updates. This can reduce the risk of future inquiries or investigations, and demonstrate to regulators and the public that the business is committed to continuous improvement and accountability.
The possibility that a public inquiry can lay the groundwork for criminal investigations poses additional risks for businesses involved. Preparing thoroughly for the inquiry, cooperating with legal requirements, and taking steps to mitigate reputational and compliance risks can help businesses navigate this challenging process.
Businesses that understand the intersection between public inquiries and criminal investigations are better equipped to manage the potential legal and reputational risks involved. By taking proactive steps and working closely with legal advisors, companies can position themselves to respond effectively if criminal liability becomes a concern. Early action almost always leads to savings and protects a business’s profitability. Being informed and prepared can help businesses safeguard their interests and emerge from the inquiry process with their legal and reputational standing intact.
