July 2017 | EXPERT BRIEFING | LITIGATION & DISPUTE RESOLUTION
Technology is playing a key role in helping financial services companies both protect themselves from, and respond to, regulatory investigation and litigation. However, despite advances, gaps in the process still arise, leaving companies open to the risk of exposure and reputational damage.
Regulatory response: the audio challenge
Where regulatory investigation is concerned, a range of factors make a timely and effective response more challenging. The sheer volume of data and the number of places in which it is stored – from email accounts, smart phones, tablets, social media and more – complicates the process. The global nature of business adds another layer of complexity. Cross-border data transfers are frequent and often crucial components of everyday business. When it comes to retrieving and disclosing that data, companies need to make sure that they can do so without violating data transfer regulations and privacy laws.
Electronic disclosure, or e-disclosure, is the process of searching for information, reviewing it to determine which information is relevant and then disclosing the information as required. If a financial services company is suspected of wrongdoing and is investigated by a regulatory body, it will need to work with its legal team to access and review any supporting information, such as emails, text messages, instant messaging and telephone calls, in order to support its case or build its defence.
Increasingly, essential detail is held in audio form, be it recordings of conversations with customers or internal recordings from the trading floor, from voicemails or teleconferencing systems. A typical e-disclosure model is designed for documentation rather than other types of file, meaning that businesses must identify a strategy for retrieving any audio detail that arises.
One of the biggest challenges for companies responding to regulatory investigations is the short timeframe allowed. In many cases, just a few short weeks are given to review all the necessary data and build a case. Attempting to handle the review of audio evidence in-house, without expert assistance, can be a time-consuming and expensive chore, often resulting in skilled staff being disrupted from core tasks.
The technologies and techniques which are available to deal with audio evidence are evolving rapidly and it is important for lawyers to keep abreast of these developments. Dealing with audio evidence efficiently, such that the cost remains proportionate to the overall cost of the legal exercise, is a challenge. As ever, while the technologies are crucial to providing a solution, a considered and well thought through plan and consideration of the available options will stand those who are required to search, review and disclose audio evidence in good stead. For example, transcription of the audio so that it then becomes a ‘document’ to review alongside the original documentation or data set is a key option. For large volumes, a certified, independent transcription is an effective solution.
Should litigation arise – either as the result of a regulatory investigation or a case brought by a consumer or competitor – financial services companies should follow best practice, not only in preparing for the case, but also while the case is in progress.
Audio evidence can be pivotal to a legal case and a failure to deal with this evidence effectively and efficiently can leave businesses open to judicial criticism, as well as damaging publicity and searing fines from regulators.
Preparation is key, but so is taking control of communications once matters proceed to court. In any legal case there will be a number of stakeholders that need to be kept up to speed with events as they unfold. Court reporting is an essential service, providing a verbatim record of legal proceedings as they happen. For complex proceedings involving multiple parties or large amounts of evidence, real time court reporting is of particular benefit, especially where information needs to be shared with team members in multiple locations. Text is sent directly to laptops in the hearing room so that stakeholders can annotate transcripts according to issues specific to their case. They are also able to create customised search and annotation reports across multiple hearing days, allowing all results to be consolidated in one document.
Staying on top of tech trends
Rather than dealing with multiple service providers, forward-thinking businesses look to partner with those who can bring a holistic view to data retrieval, review and presentation.
These vanguard businesses are not waiting for a request for information or for a legal dispute to emerge. Rather, they proactively approach experts to devise a plan and consider the most appropriate level of service. Technology is evolving all the time, so partnering with an expert provider will ensure that plans adapt accordingly to benefit from continued advances.
Lorraine Medcraft is sales director at Epiq Systems.
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