An investigation will often be ongoing at the same time that the company’s external auditors are preparing financial statements.  Those auditors may be interested in the subject matter of the investigation.  The law is clear that disclosure of privileged information to external auditors waives the attorney-client privilege.1  Courts are split, however, as to whether, and in what circumstances, disclosure of attorney work product, such as interview memoranda, waives the work product protection.2

Accordingly, investigators must exercise caution when communicating with company auditors, particularly when auditors request written summaries or updates regarding a pending investigation.  Such information should be provided, if at all, in a high-level oral report summarizing the investigation.  Emphasizing the process and methodology of the investigation rather than disclosing the factual findings may serve to preserve the applicable privileges and satisfy the auditors.

Another aspect of UK law to consider with respect to preserving privilege is that auditors in the UK also have an obligation to disclose knowledge or suspicion of potential money laundering.  Caution should therefore be exercised when updating auditors on the findings of any internal investigations because if an auditor receives sufficient information to know or suspect that the company may be in the possession of the proceeds of a crime (such as funds received through a corruptly obtained contract), then it may trigger the auditor’s disclosure obligations.  An auditor would be prohibited from informing a company that he has  made such a disclosure.


1 See United States v. Deloitte LLP, 610 F.3d 129, 139-40 (D.C. Cir. 2010); Chevron Corp. v. Pennzoil Co., 974 F.2d 1156, 1162 (9th Cir. 1992).
2 Compare United States v. Deloitte LLP, 610 F.3d 129, 141 (D.C. Cir. 2010) (no waiver), with SEC v. Roberts, 254 F.R.D. 371, 374-75 (N.D. Cal. 2008) (waiver) and Medinol, Ltd. v. Boston Sci. Corp., 214 F.R.D. 113, 114, 116 (S.D.N.Y. 2002) (waiver). 



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