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A Section 2 Notice is a demand for co-operation from the Serious Fraud Office (SFO) to individuals and organisations it believes hold information relevant to a criminal investigation. These notices are powerful investigative tools which are routinely used by the SFO to investigate the most complex and serious fraud and bribery allegations.
Any Section 2 Notice compels its recipient to provide information to the SFO, either by handing over material, or by answering questions (often) at a formal interview. Failure to comply without reasonable excuse is a criminal offence which can result in serious sanction, including imprisonment.
Anyone issued with such a notice is recommended to seek legal advice before responding. Expert Section 2 Notice solicitors can help ensure that the the SFO has properly deployed this far-reaching power, and that any response to the agency is appropriate, and accords with the law.
Hickman & Rose has significant experience advising individuals and companies how to respond to these notices. The team has acted for individuals before and during their compelled interviews with the SFO. Hickman & Rose solicitors have helped numerous clients successfully navigate this process (which will often involve negotiation and a degree of cooperation).
In some cases a notice may require challenge. Hickman & Rose has the expertise to do this and has successfully challenging by way of Judicial Review the decision to issue a notice.
A Section 2 Notice is so called because the power to issue the notice is found in section 2 of the Criminal Justice Act 1987 (CJA): the same piece of legislation which created the SFO.
There are two main powers, both of which are described under different paragraphs of the Act. These are:
– The power to compel someone to attend an interview at which they must answer questions ‘or otherwise furnish information’. Section 2(2) of the CJA.
– The power to require a person to produce any ‘specified documents, or documents of a specified descriptions. Section 2(3) of the CJA.
In some circumstances the SFO also the power to apply to a court for a search warrant to exercise Section 2 powers.
A notice is generally comprised of three elements. It will usually start with a summary of the allegations the SFO is investigating. It will then set out precisely how the agency requires the recipient’s co-operation (included a proposed interview date, or deadline for documentation provision). Finally, it explains the law under which the SFO makes this demand.
The first thing the recipient of a notice should do is contact an expert Section 2 Notice solicitor. The best way to respond will vary depending on the specifics of the case. However, any notice will raise a number of questions, including:
1. What is the legal basis on which the SFO is making its demand for information and is the notice properly made out?
2. What information or material does the notice require me to provide?
3. What information or material is outside the scope of the notice?
The SFO makes frequent use of Section 2 powers. It can sometimes be the case that a notice is wrongly made out or demands information beyond the scope of the section and some notices are susceptible to challenge.
In many cases the SFO will engage on the timing of an interview or deadline to provide documents. It is also often receptive to reasonable requests for additional time to comply.
A Section 2 interview is usually a formal, recorded, interview, conducted by SFO investigators, which the interviewee is compelled to attend and answer questions.
The interviewee must truthfully answer the questions posed. They may only refuse to answer if there is a ‘reasonable excuse’ to do so and/or if doing so would be result in the disclosure of information covered by Legal Professional Privilege (LPP). This first of these criteria is extremely hard to fulfil. The second will depend upon the nature of the information and how and why it was communicated before determining if LPP applies.
It important to note that a Section 2 interview is not the same as an interview held under the Police and Criminal Evidence Act (and generally known as an ‘interview under caution’)
Unlike an interview under caution, information gleaned at a Section 2 interview cannot be used in any future prosecution of the interviewee (save for in very limited circumstances, the most important of which being if a statement has been made which was knowingly or recklessly false or misleading).
Section 2 interviews can pose significant legal risks to interviewees. For example, the SFO is able to change the status of an individual from ‘witness’ to ‘suspect’ mid-interview, having starting off interviewing them under section 2 powers.
SFO interviews can be stressful and time consuming (they sometimes run over multiple days). The support of a Section 2 Notice solicitor during this process can make a big difference.
There is much an interviewee can do to properly prepare themselves. In many cases, the SFO will provide pre-interview disclosure to assist with interview preparation, and in some cases a list of issues to be raised.
The SFO will usually agree to a lawyer, who is independent from a company under investigation, to attend an interview alongside their client. Sometimes the SFO will agree to an interview at the lawyer’s office or another venue more convenient for the person being interviewed.
When a suspect is questioned about a criminal offence they are not required to answer questions. However, there is no such right to silence for those compelled to answer questions under a Section 2 Notice.
Failing to answer questions (or hand over material) in response to a notice is a criminal offence if done without a reasonable excuse.
In order to counterbalance what would otherwise amount to a serious breach of a fundamental right, answers given in response to questions under a notice cannot be used against the person making them except in very limited circumstances. The main exception being if a statement is made knowing or being reckless as to it being false or misleading in a material way.
In most circumstances a notice will override any duty of confidentiality owed to an employer. However there is an exception to this for material and information which is covered by legal professional privilege (LPP).
Identifying whether material is covered by LPP (and thereby does not have to be disclosed) is therefore an important step to take before responding to a notice demand from the SFO. This is one area in which seeking legal advice can be helpful.
Failing to comply with a Section 2 Notice is a criminal offence which may result in a fine or imprisonment on conviction. There are three main ways in which failing to comply might risk prosecution:
1. Failing to comply with a notice without a reasonable excuse contrary to Section 2(13) of the CJA.
2. Making false or misleading statements in purported compliance with a Section 2 requirement contrary to Section 2(14) of the CJA.
3. ‘Falsifying, concealing, destroying or otherwise disposing of’ relevant documents while in the knowledge that an investigation is ongoing contrary to Section 2(16) of the CJA.
In some cases notices under Section 2 of the CJA can demand information be provided immediately. These are known as a ‘here and now’ notices and are usually presented in person by investigators, often as part of an unannounced premises search. In such a circumstance the notice may demand the provision of information such as combination code for an office safe, or the password to a computer.
Any individual or organisation presented with a ‘here and now’ demand is advised to contact an expert law firm urgently – ideally one with the resources to provide immediate, on site, legal representation.
The difference between a Section 2 and a Section 2A Notice is that that former concerns an investigation that has been formally opened by the SFO whereas a demand under Section 2A concerns a case that has not (yet) been formally opened.
Although a Section 2A Notice may be considered to be more of a ‘scoping’ exercise by the SFO, there is little practical difference to the way a recipient should respond to the two different types of demand. Both should be treated seriously.
Hickman & Rose solicitors have regularly advised, and represented, the recipients of notices under Section 2 of the CJA. The firm’s Business Crime department has significant experience advising individuals in responding to Section 2 demands in many of the SFO’s biggest fraud and bribery investigations. The firm has successfully challenged a notice by way of Judicial Review.
Among the many high-profile matters on which Hickman & Rose has given Section 2 advice include the SFO investigations into Rolls-Royce, Greenergy, British American Tobacco and Petrofac. The team has also given advice in many significant Section 2 matters that have remained outside the public domain.
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