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Why Is Speed an Advantage in Regulatory Investigations?

by Chuck Kellner

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Regulatory investigations are on the rise, and for organizations looking for a strategic and tactical advantage, speed is key. That was one of the key takeaways from “The Regulator Always Rings Twice: Responding to a Government Request,” a CLE panel hosted by Everlaw at New York LegalWeek on March 9th. Expert practitioners in financial services and healthcare gave us their takes on trends, best practices, and ways to mitigate risk in government investigations.

We thank panelists Krista Ellis from Credit Agricole CIB, Briordy Meyers from Boehringer-Ingelheim, Aaron C. Mahler from Buckley LLP, and moderator Shana Simmons from Everlaw for your time, thoughtfulness, and dedication in bringing their important messages to the session.

Across topics, an overarching theme emerged: there are significant advantages to a swift response and efficient workflow in responding to regulatory requests.

As state and federal agencies press down on activities around technology, privacy and data breach, consumer lending, and employee relations, just to name a few, every regulated or publicly-traded company feels the pinch.

You gain huge strategic and tactical advantages by leveraging technology for speedy responses to regulatory investigations. With speed, you gain credibility with the regulator. You get an early jump on cost, scope, timing, and risk. And through that, you can avoid mistakes that arise if you negotiate scope before having your arms around all of the data.

Clearly, there are times when you want to pump the brakes, take time to evaluate the government’s request, and consider a measured response. But you know that every client wants to get an investigation into their rearview as quickly as possible.

The Old Approach to Regulatory Response: When a Regulator Comes Knocking

Here’s a common scenario: A regulator wants to look at a cross section of emails and mobile device communications for the past three years. They want a long list of people, but only “a handful” at a time. An exploratory call reveals that the agency doesn’t want to review “a bunch of junk” and has “some keywords” in mind you can use to filter before review. But so far, you haven’t collected or looked at any data.

You set your team the tasks to collect ESI from email accounts, Slack, and Teams. Your BYOD or mobile device policies let you ask or demand to collect mobile devices for the messages, WhatsApp, WeChat, and other communications, pictures, or recordings.

Your current workflow requires IT people and analysts to copy huge email files first to their servers, then to your servers, and then to your review system, and then into processing and loading for search and review. As usual, you learn that just copying data takes days, and the whole process will take weeks. In the meantime, the government waits to hear what you think of their search terms. Key stakeholders wait to hear how much, how long, and is there anything to worry about?

So you get a few priority custodians’ emails loaded, and you test-run the search terms once or twice. You negotiate scope on that basis. Still, you don’t have the rest of the data loaded to figure out the burden, timing, or cost. Still, you don’t know what the mobile devices might contain.

A Better Way: How to Speed Up Regulatory Response Times

On day one, you issue a legal hold and begin collecting email, Slack, Teams, OneDrive, and Calendars. You start reviewing the initial search hits of emails, attachments, Slack, and Teams of your priority custodians. By the end of day two or three, you have a complete picture of the total number of search hits. You assess the total time and cost of review. You go back to the government with a strong case on the overbreadth of the search terms.

The messages, pictures, videos, and recordings of data from mobile devices can be searched within a day after collection. Images, audio, and video (A/V) files have OCR or machine transcription, so you can quickly apply search terms. The messages are slim on search hits, so you negotiate some very specific to-from combinations with the government.

With your data now fully loaded, searched, and de-duplicated, you can approach the government with which highly duplicative custodians might be dropped from the list. You might not be able to take them off legal hold, but you have shrunk the size of the review and shortened the list of people who may have to be interviewed.

Your Strategic and Tactical Advantage

Using data rather than guesswork, you have minimized the number of custodians.

You don’t yet know the outcome of the regulatory investigation, but key stakeholders are happy that you made short work of the scope and the assessment of cost.

You are operating credibly and quickly with facts, so the government is not waiting weeks for your take on their search terms. You don’t have to “go back to the well” to ask for concessions later, after you load the rest of the custodians.

It Gets Even Better…

Your reviewers tell you that there are multiple meanings for several big search terms and that they are wasting time and money reviewing non-responsive documents. Because you have Clustering available and Active Learning running with your review, you can look at a heat map of where in your collection your likely responsive documents are compared to your non-responsive search hits. You develop a great case to go back to the government and make some very valuable tweaks to your review criteria.

Meanwhile, your review rolls up important documents into an automated timeline of issues and events. Senior team members work collaboratively on a narrative and chronology, hyperlinked directly to documents and communications. Your plan is to refine this storytelling collaboratively with key stakeholders and then present it to the government.

Leveraging Technology for a Better Approach to Regulatory Investigations

The “Better Way” workflow described above includes Everlaw’s Legal Holds and connectors to collect natively from Office 365, Slack, Teams, and Cellebrite images.

The “Gets Even Better” workflow integrates Everlaw’s Active Learning, Clustering, and Storybuilder and makes possible the workflows for cost savings, review, and collaborative development of fact narratives.

All of these features are included in every project, including training and support.  

When it comes to meeting today’s most pressing legal challenges, having the right tools in place to respond quickly, effectively, and confidently is essential. That’s why big-firm and corporate legal teams leverage Everlaw in their fast-moving regulatory investigations even while their internal ediscovery departments assess the fate of their legacy systems. 

Are you interested in learning more about recent legal trends and ediscovery predictions for 2022? Download a free copy of “Lighting the Way: 2021 Ediscovery Trends & Everlaw’s 2022 Predictions” and “2021 Ediscovery Trends: Collaboration and Security” to learn more!