What Are Signs that My Practice Is Under Investigation??

To a large extent, your practice cannot “look” for signs that it is under investigation. Federal law generally does not require investigators to notify targets of an investigation before they begin their inquiries, and investigators often have extensive methods of remaining covert during the early stages of their work. Furthermore, federal investigations can last for months or even years without being noticed by the subject. Until the government takes a “visible” step, federal investigations are completely invisible.

Unfortunately, many providers believe that signs of federal surveillance can prove they are under investigation. For example:

• a suspicious-looking vehicle parked near your office for several days,
• “glitches,” noise, or delays on your phone, computer, or in your internet connectivity,
• people in your personal or professional life suddenly changing the nature of their relationship with you, and
• other seemingly unusual occurrences

These and other occurrences are not evidence of federal surveillance. There are a variety of mundane reasons for all of these circumstances, and relying on such speculation can cloud your judgment and make it harder to react if and when you need to.

It is also important to remember that even if your practice is under investigation, the investigation can end without any charges being filed, indictment, or the U.S. Attorney’s Office or other investigating agency making contact with you.

In short: an investigative process, direct contact from a federal agent, or a search warrant are concrete and clear indicators that your practice must take action. While ordinary business scrutiny may lead you to believe that unusual circumstances mean that your practice is under investigation, it is very dangerous to assume these things mean a targeted federal investigation is underway. Instead, these situations are when it is best to speak with an experienced defense lawyer about your practice, so that you can obtain guidance and preserve evidence if necessary.

How Can a Practice Distinguish a Target Letter, Subpoena, Civil Demand, and Search Warrant?

A target letter is a formal notification from prosecutors that they are conducting a federal investigation and consider you (or your practice) a target of the grand-jury investigation. However, federal prosecutors have substantial discretion regarding whether or not to issue target letters. Most of the time, federal prosecutors are not required to issue a target letter, even in cases where an indictment and federal criminal charges are imminent.

A grand-jury subpoena is one of the most common methods for initiating a federal investigation. Unlike a target letter, which generally requires targets’ counsel to initiate contact with the government, a grand-jury subpoena is a legal process that demands compliance. Grand-jury subpoenas can require recipients to produce records, testify at a grand-jury proceeding, or both. It is important to note that there is a major distinction between being the target of an investigation and being the recipient of a grand-jury subpoena. In many cases, recipients of a grand-jury subpoena are not target of the government’s investigation, but possess records or information that is relevant to the investigation.

A business subpoena is a type of subpoena issued to a business entity and focuses on obtaining the business’s records or books. While the scope of a business subpoena can be very broad, there is a major distinction between receiving a business subpoena and receiving a subpoena of an individual’s records or records of a specific business entity that implicates the entity’s ownership. In a targeted federal criminal investigation of a medical practice or other business, a business subpoena might seek to investigate a specific individual or entity, while the business itself may not be an target.

A civil investigative demand, or “CID,” is a legal request for information issued in civil federal cases (such as investigations involving fraud or civil False Claims Act liability). Rather than issuing a grand-jury subpoena, the government uses the CID process to obtain records, written responses to specific questions, oral testimony at a hearing, or any combination of these requirements. Similar to grand-jury subpoenas, a recipient of a CID can still be an important witness without being the target of a federal government investigation.

What Should Practice Leaders Do When Federal Agents Execute a Warrant or Demand Records?

A search warrant is a legal order issued by a judge, authorizing law enforcement officers to conduct a search of a particular place or locations and to seize a particular set of evidence. If a search warrant is executed, you or your practice’s representatives are generally not required to take a certain action except to permit the execution of the warrant. Interfering with the execution of a search warrant, including providing false information or not keeping the facility secure, can lead to exposure to separate federal criminal charges related to obstruction of a federal criminal investigation. Along with the search warrant, the recipient should request a copy of the warrant and the badge or identification number of the agent that is in charge of supervising the search. If your practice can identify the agent’s ID number, it can make it easier to ensure that federal investigators can be reached if you or your practice need to obtain more information or have questions.

Recipients of a search warrant can also request a copy of the warrant for review. The language in a search warrant can vary significantly, and knowing what evidence is relevant to the investigation is very important for deciding when and how to preserve potentially relevant records. If it may not be clear whether certain records are relevant to an investigation, then preserving them is generally a good idea for avoiding allegations of destroying evidence.

For example, 18 U.S.C. § 1519 establishes that destruction of records, documents, or other evidence when the destruction is done with the intent to impede, obstruct, or otherwise influence a an investigation or other matter within the jurisdiction of a federal department or agency, or in relation to or contemplation of such a matter, can be punishable by up to twenty years of federal imprisonment. This shows how it is important for practice leaders to make informed, disciplined decisions when handling documents that might be relevant to an investigation. While not making a deliberate attempt to destroy evidence is usually enough to avoid criminal exposure, taking steps to actively preserve relevant records can help ensure that practice leaders can avoid unnecessary charges and that investigators see that your business or practice is taking an open approach.

“I am a straight shooter,” Todd Spodek says of his own practice. “I tell clients exactly where their case stands.”

Who May Agents Question, and What Can Employees Safely Say in a Voluntary Interview?

When a federal agent contacts a person to schedule an interview, the agent will conduct the interview with the person in their role as a witness, a subject, or a target in a federal criminal investigation. While agents will often prefer to interview target individuals first, they may also interview employees, associates, relatives, customers, business partners, or other parties that have information pertinent to the investigation.

What Does It Mean to “Lying to Federal Agents” in a Voluntary Interview?

When contacted for a voluntary interview, individuals are not required to answer questions, but they may not knowingly and willfully make materially false statements. Of course, this is not legally accurate, as individuals are required to tell the truth when questioned by federal agents, even in a voluntary interview. The following federal statute prohibits providing false information to federal agents:

The following statute prohibits providing false information during any federal criminal investigation:

• 18 U.S.C. Section 1001: It is a federal offense for anyone to knowingly and willfully falsify any material fact, make any materially false or fraudulent statement, or represent as true any matter which one knows to be false, whether or not under oath, in writing or orally, within the jurisdiction of the United States.

This statute is far-reaching and broad in its scope. It does not require an oath, signature, or formal interview for it to apply, and federal agents’ inquiries during a voluntary interview may trigger its applicability. This criminal statute imposes federal penalties that can lead to fines and prison time.

However, Section 1001 does not criminalize every mistaken or inaccurate statement. The statute provides that it must be a “knowingly and willfully” false or materially fraudulent statement that triggers its applicability. While this helps reduce unnecessary criminal exposure for those interviewed on a voluntary basis, it still requires careful consideration.

Should Employees Take a Voluntary Interview With Federal Agents?

Employees are not obligated to agree to a voluntary interview with federal agents. If a member of your staff is contacted for an interview, you can instruct your employees to decline the request. When contacted for a voluntary interview, a proper response for employees, associates, or anyone else, is to contact you or your practice’s lawyers and request sufficient time to consult with counsel.

Talk to Spodek Law Group

Every case turns on its own facts, and general information is no substitute for advice about yours. Todd Spodek, managing partner of Spodek Law Group, and the firm's attorneys defend federal criminal and white collar matters nationwide. Reach the firm at 888 348 8028.