Both a criminal investigation and civil enforcement action can have profound consequences for a business or corporation, but the two differ considerably in the United States. Generally, the most significant differences are (1) the government’s ability to gather information; (2) the rights of those under investigation; (3) the applicable standard of proof; and (4) the sanctions the government can impose.
- Gathering information: In a criminal investigation, the government can use grand jury subpoenas to obtain almost any non-privileged information in the United States, and in some cases abroad. For civil investigations, the power to subpoena information is much more limited.
- Rights of investigative subjects: Individuals facing criminal investigations may invoke their constitutional right to remain silent without consequence and can demand a jury trial. In civil enforcement individuals may still invoke their Fifth Amendment right but a court or jury can assume from the individual’s silence that he or she engaged in the wrongful conduct. Nor does the Sixth Amendment’s right to counsel apply in the context of a civil enforcement action. Moreover, a party subject to a civil enforcement action may not have a right to a jury trial. In fact, some civil enforcement actions do not even begin in court. Instead, an agency of the government, like the Food & Drug Administration, will be the first to consider the merits of the enforcement action.
- Standard of proof: When the government brings criminal charges, it must prove the defendant’s guilt beyond a reasonable doubt. In civil enforcement, the standard of proof is much lower. The government usually only needs to prove that it’s “more likely than not” that the individual engaged in the wrongful conduct.
- Sanctions: A criminal conviction can result in a prison sentence, probation, and even dissolution of a company. Those penalties will not result from civil enforcement. But you can face heavy fines and burdensome court orders that prohibit you from engaging in certain activity in the future.
Sometimes a criminal and a civil investigation will proceed at the same time. And the agencies conducting the investigations may include state as well as federal authorities. Actions taken in defending one investigation may well have repercussions in another. So, it is critical that a company or individual facing parallel investigations develop a strategy that accounts for how the various matters will proceed and the possible outcome of each.
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