Big ticket M&A may be in short supply but both defensive and regulator-instigated investigations into corporate behaviour is burgeoning, as Linklaters becomes the latest leading law firm to secure a high profile mandate, advising G4S on its recent tagging scandal.
The Magic Circle firm led by corporate partner Richard Godden and litigator Tom Lidstrom has been called in to advise the private security company, which recently returned to the public eye after the justice secretary Chris Grayling called for it and rival security firm Serco to be investigated for overcharging for the electronic tagging of offenders.
Chris Grayling has asked the Serious Fraud Office (SFO) to consider investigating after telling MPs that the security outfits have been overcharging by millions of pounds for tracking the movements of offenders who have moved abroad, had their tags removed, or even died.
It is understood that Godden and Lidstrom have been assisting G4S for a few months and it was Godden who advised the beleaguered company when it was unable to comply with its obligations to provide the contracted level of security personnel for the London 2012 Olympics, leading to a national outcry and the resignation of G4S chief Nick Buckles.
A powerful combination of the criminalisation of corporate law and the continuing depressed economy means investigations continue to rise – a boon for litigation departments – as politicians and regulators demonstrate their willingness and speed to act against corporate crime, and corporates conduct their own investigations in order to get their houses in order and minimise negative publicity.
Firms including Allen & Overy, White & Case and Gibson Dunn have secured high profile mandates in relation to investigations on Libor rigging alone.
Antony Dutton, a litigation partner at Dechert and former partner at legacy Norton Rose, said: ‘Contentious practitioners are seeing a considerable increase in the volume of regulatory investigations being undertaken in the wake of the global financial crisis, with Libor being the most high profile. There are also more SFO probes.
‘This is now a very substantial area of work. The reality is that there is far more of an appetite amongst the regulatory community for investigations. This had led clients to be more proactive and to get their house in order in advance with associated opportunities to conduct audits.’
A statement from the SFO said: ‘The SFO is aware of [the G4S] matter and awaits the referral from the Ministry of Justice.’
Grayling has stated he has no evidence of dishonesty at this stage and both companies have promised to repay any money found to be due.