The police search as a latent corporate risk

The element of a police search of a company is indispensable in the context of a company's internal risk analysis. No company is safe from state access. Even with the most modern design of the internal governance structure and the implementation of effective compliance measures, it is not possible to comprehensively prevent employees from committing criminal offences.

Constant risk
In the financial sector, this includes asset offences, such as misappropriation of company assets or fraudulent conduct by employees towards clients. Money laundering is a constant topic, mixed with other areas of crime. In the industrial sector, product defects with the resulting consequential damages are particularly relevant, which can also be sanctioned in the case of negligent acts. The reciprocal effect of such acts on the criminal liability of a company itself results from Art. 102 of the Swiss Criminal Code, according to which, in the case of misconduct by employees, the legal entity can be punished with a fine of up to five million Swiss francs if it is not sufficiently organised to prevent such incidents.

In this context, it is impressive that, according to current figures, one in three companies is affected by crime and that these are damaged to the tune of several hundred million francs annually as a result. The risk of a police search is therefore latent in every company and should be prepared accordingly.

obtaining documents
If the authorities wish to obtain documents from companies, they must be guided by the constitutional principles of proportionality and fairness; the Code of Criminal Procedure lays down the details. This means that the mildest possible means must be used to obtain documents without jeopardising the purpose of the investigation. A certain practice has been established in this regard:

• As an alternative to house searches, the standard for obtaining documents is primarily the written edition of documents and data; the management of a company is requested to hand over the documents by means of an order, including the setting of a deadline. This takes place below the public radar and without any media attention.
• In recent years, the instrument of the so-called accompanied edition has been used as the next qualified level for obtaining documents. Here, the public prosecutor's office visits a company without warning and requests the voluntary surrender of documents. If such a request is followed immediately, the company is not searched.
• Otherwise, the actual house search is carried out. It is not uncommon for a team of qualified investigators to be on hand to carry out the search in a targeted and comprehensive manner. The consequences of a house search are by far not only of a legal nature. It is not uncommon for major house searches to be accompanied by corresponding headlines, irrespective of the often-mentioned presumption of innocence. The damage to the company's reputation inevitably leads to identification problems among stakeholders, with a possible impact on turnover, profit and acceptance of the company.

The task is to prepare for an emergency. The maintenance of operations must be ensured, process interruptions must be minimized, and appropriate procedures must be implemented. This includes the definition of procedures and contact persons towards the authorities up to the training of acceptance situations. A defendant can rely on his Miranda rights, i.e. he can refuse to testify and consult an attorney. On the other hand, it is to be expected that any statements can be used by the prosecution.

Procedure of a house search
The search of the house must in principle be endured. In legal terms, there is little room for manoeuvre to defend oneself against the act of a search. At the beginning, the police inform the suspect and the reason for the house search. The rights and duties of those present are pointed out, and there is not much time for reaction and intellectual processing. The central right is the so-called sealing. This means that those entitled to the documents - employees, third parties or the company itself - can demand that the secured files be sealed. If this right is exercised, a judge is subsequently responsible for deciding whether the seized documents can be evaluated by the public prosecutor's office or not.

If persons are also to be arrested on the occasion of a house search, other rights and procedures are again relevant. The securing of persons is initially also to be endured. Only after expiry of the procedural deadlines, up to a maximum of four days after an arrest, does a compulsory measures judge have to decide on the lawfulness of the arrest. The securing of persons is also to be endured at first. Only after expiry of the procedural deadlines, up to a maximum of four days after an arrest, does a compulsory measures judge have to rule on the law.

Impairment of the company's operations
It is not uncommon for company-relevant house searches to begin before the company is actually tangled up by the police. If employees or organs are suspected of criminal acts, a search of their private premises becomes relevant. There is thus a staggering of searches, starting at home in the family area. After the private search has been completed, the accused are taken to their place of work or to the company, where follow-up searches are carried out in their presence. In-house searches can last hours, sometimes days. The central step of a house search is the securing of the EDP data, which is done by mirroring servers if possible. Under certain circumstances, this leads to the paralysis of the company's internal structure. It can therefore be assumed that a police search can comprehensively impair the work of employees and organs as well as the functioning of company operations.

It can therefore be seen that the development of a company-internal defence system is part of the standard of a mature and realistic risk management. Even after searches, criminal proceedings can keep a company busy for a long time or even impair its economic development for years.