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How Responding to a Civil Investigative Demand Can Strengthen Compliance Programs
March 21, 2024
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How Responding to a Civil Investigative Demand Can Strengthen Compliance Programs
Based on the search results, here are some key points about responding to a civil investigative demand (CID) and how it can strengthen compliance programs:
- CIDs are like administrative subpoenas issued by the FTC to demand information related to investigations. Ignoring them can lead to court-ordered compliance and penalties
- CIDs typically request documents, tangible items, written answers to questions, and oral testimony. They aim to gather facts regarding potential legal violations
- Companies that receive CIDs should promptly contact legal counsel experienced with FTC investigations. Missteps in responding can increase likelihood of criminal charges or lawsuits
- Cooperating selectively, being open about burdensome requests but not wholesale resisting compliance, can achieve favorable outcomes. The goal is balancing cooperation with protecting the company’s interests
- To lower investigation risks, companies can document privacy policies, track customer complaints about unfair/deceptive practices, research the latest regulatory guidance, and show reasonable good faith compliance efforts
- Responding thoroughly to CIDs provides opportunities to review policies and procedures and demonstrate commitment to legal compliance. This can strengthen compliance programs even if issues are found later
In summary, working constructively with experienced legal counsel, cooperating reasonably with investigators, documenting compliance efforts, and conducting self-audits in response to CIDs can ultimately improve compliance programs and reduce enforcement risks.