Legal requests for company data have doubled

Legal requests for businesses to hand over internal data to the Serious Fraud Office (SFO) have more than doubled in the past five years.

Law firm Pinsent Masons says 1,032 ‘Section 2’ notices have been issued by the SFO in 2017-18 without the government agency needing to seek approval for the orders through the courts. This number is up more than 123 per cent on the 463 notices issued in 2013-2014.

Section 2 notices compel businesses to hand over documents or electronic data to assist with SFO investigations, without the need for judicial oversight to impose the order. Failure to comply is a criminal offence, which can attract up to six months in prison.

The law firm found that Section 2 powers have also been used increasingly to compel documents from overseas companies instead of going through the traditional route of mutual legal assistance, which involves judicial oversight.

Responding to the increase in Section 2 notices, Tom Stocker, head of corporate crime at Pinsent Masons, said they were a “powerful investigative tool in the SFO's armoury”.

He said traditional search warrants require the SFO to explain to a judge why their proposed search parameters are appropriate, whereas the exercise of Section 2 powers requires no such checks.

As a result, Stocker said that a review of the law relating to the “compulsory and intrusive powers” involved in Section 2 powers should also be considered.

He explained: “When the SFO were given these powers in the late 1980s, prior to the digital age, companies would have been able to produce the limited number of paper records they were required to deliver much more easily than large amounts of digital data now required.

“Even a straight forward sift through of emails, texts, instant messages, phone call logs can be phenomenally expensive.”

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