Civil Investigative Demand – Federal Lawyers

| by Max Soni

Last Updated on: 2nd October 2023, 05:51 pm

Civil Investigative Demand (CID)

A civil investigative demand, commonly abbreviated CID, is a subpoena that is served by the federal government. It allows federal agencies to receive information from you and other private entities despite not going through the formal court. If you’ve been given a CID, it’s important to respond in a timely manner to avoid serious potential repercussions. Reach out to a lawyer to talk about your options and what the situation means for you.

Who Issues CIDs and Why?

CIDs may be served by a vast number of different federal agencies. You might get one from the Attorney’s Office, Department of Justice, Federal Trade Commission, or the Consumer Financial Protection Bureau. Each of these agencies issues CIDs when they are doing civil investigations rather than criminal. However, that doesn’t mean you have nothing to worry about. Even civil violations can lead to thousands of dollars in fines. And if the investigation finds that you had criminal intent, the agency may begin a criminal investigation as well.

How to React to a CID?

Businesses and individuals who have received CIDs need to react strategically to avoid consequences. There’s a very low chance that you’ll be able to avoid complying with the order, though you might be able to limit how much information you give up. If you submit an incomplete or late response, the agency will assume you have something to hide. Your chances of being prosecuted will go up. It’s vital that you understand both your rights and your obligations when dealing with federal agencies.

How Does a CID Work?

A CID is a subpoena that is often used by the DOJ alongside other agencies. Over the past decade or so, the document has begun to be used much more increasingly. Prior to 2009, the US Attorney General was the only one who could issue a CID. But the Fraud Enhancement and Recovery Act allowed this power to be wielded by people beyond the Attorney General’s Office. Now the documents are used in multiple types of investigations.

Process and Compliance

Since the subpoena is administrative, it does not need to be approved by a court. This means that federal agencies can issue a CID completely at their discretion. They can even do so before they’ve created any formal litigation. Even though there’s very little oversight into the issuing of CIDs, there’s also very little recourse if you want to challenge them. This means that businesses and individuals may find themselves needing to offer vast amounts of information without the approval of a judge.

CIDs typically request documents. They may request large volumes of documents. In fact, if a healthcare provider receives a CID, it’s common for them to need to offer several hundred thousand electronic and paper records. This can quickly become overwhelming, especially since the clock is ticking from the time of the subpoena. Failure to comply within a few days can lead to prosecution.

Reasons You Might Be Served

Most people have no idea why they’ve received a CID when they get it. Civil investigations tend to be a surprise. Since no litigation has been formally announced at this point in the process, there is no way to find out from the government what is being investigated.

Understanding Your Role and Compliance

As you respond to the CID, one important thing is to determine how you factor into the investigation. Are you a target, suspect, or witness? This stage is early enough in the proceedings that it’s difficult to tell, and you have no choice about your compliance no matter what. That’s part of why it’s helpful to hire a lawyer. They can analyze the language of the subpoena and draw conclusions about the situation.

Another important thing to note is that there are dozens of reasons that you might be served a CID. Not all of them mean that you or your business is in trouble. You can’t assume that you understand what investigation is happening, and you shouldn’t talk to federal agents without having a lawyer present.

You must comply with a CID, although your attorney may be able to make minor modifications through negotiations with the agency or a federal court. The big risk is that the information will be sufficient to use in a criminal or civil proceeding. A lawyer can help prepare your response to mitigate this chance as well.

Civil Investigative Demand

This is what needs to be known about a federal civil investigative demand:

• “CID”, a civil investigative demand, is a judicially administrative subpoena, which can be issued by a federal prosecutor. It also authorizes federal government agencies to obtain information from private entities. There are no formal court procedures when requesting that extraordinary information. You must respond properly and punctually if you have been served with a civil investigative demand, which will prevent you from potential dire consequences.
• Numerous federal agencies use tools known as Civil Investigative Demands (CIDs) in order to collect information throughout law enforcement investigations. These agencies stretch from the US department of justice, and the US attorney’s office to the Federal Trade Commission, and the Consumer Financial Protection Bureau. Agencies like this precede CIDs concerning civil investigations. However, civil liability may conduct substantial financial sanctions, and the uncovering of evidence of intent will certainly alter the investigation criminal in nature.
• Receiving CIDs for business organizations and individuals requires avoiding these unnecessary consequences, which need a strategic, swift, and calculated response. To steer clear of compliance with CID is unlikely, and giving away an inappropriate or inadequate response can increase the risk of federal prosecution. You must make well-informed decisions, and you need to understand your obligations and rights under federal law in order to protect yourself and your business.

What is a Civil Investigative Demand (CID)?

• A Civil Investigative Demand is an administrative subpoena, which increasingly started to be used by various agencies lately. Historically, the ability to issue CIDs was limited to the U.S. Attorney General. Respectively, the fraud enforcement and recovery act of 2009 enlarged this power beyond the U.S. Attorney General. Luckily, many agencies can issue CIDs with respect to several federal investigations today.
• CIDs do not necessarily need court approval, The DOJ, FTC, CFPB, and other agencies may issue CIDs at their discretion, before even requesting formal litigation proceedings. Moreover, individuals and business organizations frequently find themselves encountering compliance obligations, and that is because the grounds for challenging CIDs are extremely limited. As they are facing compliance obligations, they have little information about the federal government’s investigation.
• Usually, CIDs demand the production of numerous documents. For CIDs targeting healthcare providers and other businesses, it is very common that electronic records and thousands of papers to be at issue. CID recipients need to execute, gather, identify, and prepare their relative documents in a matter of weeks if not days at length.

Why Have I Been Served with a CID?

• It is a common question that is being asked by most practitioners and business owners when receiving a Civil Investigative Demand. CIDs most times comes as surprise while the federal government holds all cards.
• When developing a response to a CID, it is highly important to regulate your practice’s or business’ role in the investigation. Are you a target, a suspect, or a witness? Each one of these options has an equivalent probability; you need to obey regardless of your position in the investigation, even If you know that you are currently at risk for prosecution. Well-informed and strategic decisions must be made.
• Taking into consideration the substance of the investigation, the list of possibilities is wider. You are unable to make any expectations about the government’s motives, although the nature of your practice or business might signal the motive of the investigation, as an example: if you are a healthcare provider, there is a powerful chance that the investigation is selecting assertions of Medicare, Tricare, Medicaid, DOL, or VA fraud

Types of allegations might include:

• Healthcare fraud (Medicaid, Tricare, DOL, and VA fraud).
• Consumer Fraud in the financial products and services sector.
• Antitrust violations

What are the Risks of Complying or not Complying with a CID?

·      Even though compliance with a CID is obligatory, it may also be risky. Starting from needless disclosing information to failing to hold the attorney-client privilege, there are various ways that CID recipients can endanger themselves to an unnecessary risk during the response process.

·       The hugest risk with compliance is that the CID recipient will disclose information, which the government is able to use against it in a criminal or civil enforcement proceeding. Even so, there are many discrete risks that CID recipients have to be aware of. Namely; compliant disclosure regarding a general records request might result in tipping off the government to problems that were not obvious prior to this. Besides, if you are currently being served as a witness, there are a variety of deliberations you will need to address so that you avoid putting yourself at the heart of considerations.

What if you don’t adhere to the CID?

• Although a CID is an administrative subpoena, failure to comply still initiate civil contempt. If you are merely a witness, and you are to be discovered that you withheld information intentionally or unintentionally by a federal agent, you certainly encounter a contempt charge.

What do I need to do to appropriately respond to the CID?

• Attempts to properly respond to a Civil Investigative Demand must be prompt and planned, and they must be carried under the guidance of experienced and skilled federal defense attorneys.

We serve clients across the country, those who are facing federal investigations as suspect, target, and witness. We will help you with all the phases and aspects of your CID response, including:

• Noting all deadlines:
• We will organize and take note of all deadlines. We will also build a response plan to make sure that you timely meet your federal obligations. One single CID may have multiple deadlines.

 

• Instituting a legal hold:
• This is necessary to ensure that all responsive documents are preserved and secured. If the documents are not preserved, this can lead to a finding of contempt, and it might be interpreted as withholding information from the government.

 

• Preparing to “meet and confer”:
• We will plan the appointment and prepare to meet with the agents with you or on your behalf.

 

• Compiling responsive documents:
• After meeting you and your key personnel, we begin the process of identifying and compiling all responsive documents. We need to start as soon as possible, taking into consideration the volume of records requested, for it might be very time-consuming.

 

• Planning potential challenges and strategies:
• We will assess and seek all relevant grounds for challenging the CID. In some cases, it might be possible to significantly decrease the scope of a CID.

 

• Negotiating the scope of the CID:
• Negotiating with the issuing agency can be very fruitful. Effectively, it might be the only way to reduce a CID recipient’s compliance obligations. If this is not possible, we can challenge the CID in court.

 

• Preserving the attorney-client privilege:
• It is necessary to ensure that all privileged communications have been redacted before disclosing any records to the federal government. We can assist you with this.

 

• Preparing and submitting your response:
• When all the essential steps are successfully done, we will work on your response and submit it to the issuing agency on your behalf. Then, we will represent you in any additional government’s investigation proceedings.

Discuss your CID response with federal defense attorney:

• If you are seeking an experienced federal defense counsel to respond to a Civil Investigative Demand. We highly recommend that you contact us.