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  • Compliance & Business Integrity
  • 31-03-2017

It is common practice for businesses to commission an external party to conduct an internal investigation when wrongdoing within the business is suspected.

What is less common, however, is for the resulting report by the external party to be assessed by a court in connection with whether there is "reasonable suspicion" that a criminal offence has been committed and hence grounds for the initiation of a criminal investigation. In early March of this year, a judgment of the Noord-Nederland District Court was published concerning such a case. The underlying facts were as follows: a set of medical records that ought to have been destroyed came into the possession of a journalist, leading to the broadcast of a television programme in 2015. Following the broadcast, the company that was supposed to have destroyed the records filed a criminal complaint for embezzlement (i.e. misappropriation) of property in the course of employment. It also initiated an internal investigation into the matter. One of the questions considered by the court was the extent to which the report of an internal investigation can be helpful for the purposes of a criminal complaint and a subsequent prosecution.

The court held that in this case the relevant authorities had exercised special investigative powers [bijzondere opsporingsbevoegdheden], as provided for under the Dutch Code of Criminal Procedure, based solely on the report of the internal investigation. Special investigative powers are the most far-reaching powers that can be exercised in a criminal investigation and are therefore subject to numerous safeguards and conditions. In this case, data regarding telephone communications of the suspect (e.g. SMS messages) were obtained from telecom providers. According to the court the problem was, however, that the report of the internal investigation (a) was still in draft form and (b) had not been signed. Furthermore, the report indicated that during the interview conducted in connection with the internal investigation, the suspect denied that he was the person who had passed on the medical records to the journalist. The court pointed out that, according to the conclusion of the report, the investigation did not reveal who had passed on the information.

The court lost no time in acquitting the suspect, holding that the special investigative powers in question had been improperly exercised because, at the time they were exercised, there was no reasonable suspicion (or in any event no such suspicion as yet) that the suspect had committed a criminal offence. The court also held that the direct evidence obtained through the exercise of those powers was therefore inadmissible, as was the evidence subsequently obtained on that basis ("fruits of the poisonous tree").

We question whether and to what extent higher courts would uphold a judgment such as the one rendered in the above case. After all, it is not a prerequisite for obtaining data regarding telephone communications that there be any concrete suspicion against a particular individual. If it is suspected that a crime has been committed – and provided a number of other conditions are satisfied – details of communications even of non-suspects may be obtained. Another question is whether the "reasonable suspicion" in the above case was not based, at least in part, on, for example, the TV broadcast and/or the subsequent criminal complaint for embezzlement of the records.

In any event, the judgment emphasises that an internal investigation must be of a sufficiently high quality and its results sufficiently conclusive if it is to be relied on as the basis for follow-up steps such as the bringing of criminal charges. That aside, we do not see why an unsigned report in draft form should per se be considered an insufficient basis for reasonable suspicion that a particular person has committed a criminal offence, as such suspicion does not require certainties or fully-developed conclusions and investigative findings. It would seem self-evident that whether and to what extent such a report can be relied on in any individual case depends very much on the specifics of the internal investigation and how the report is interpreted by the relevant authorities. There have certainly been cases in which less (or even far less) was considered sufficient.

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