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Datamyne Blog

Covering trade & transport, with tips on using import-export data to advantage

Under Investigation?

Got a notice letter from the federal government? Get a lawyer.

by Peter Quinter, guest columnist

Every year, the numerous agencies of the US government send out letters to companies putting them on notice that the company is suspected of committing some serious violation. Usually, the letter or notice demands a written response within 30 days or the company will be subject to a penalty or fine. Knowing how to handle such letters, notices, or subpoenas is critical to terminating the investigation successfully, not paying a huge penalty, and even avoiding criminal prosecution.

The executive branch departments, bureaus, and agencies of the federal government all have the legal authority to investigate and assess penalties against companies that violate that particular government agency’s regulations. This is especially true of companies that are importers, exporters, or otherwise involved in international trade such as customs brokers, international freight forwarders, airlines, and indirect air carriers. The US Food and Drug Administration (FDA) would issue an “Administrative Subpoena” or a “Notice of FDA Action,” the US Treasury Department’s Office of Foreign Assets Control (OFAC) would issue an “Administrative Subpoena,” while the US Department of Transportation’s Federal Aviation Administration (FAA) would call it a “Notice of Proposed Civil Penalty.” The US Department of Homeland Security Customs and Border Protection (CBP) describes it as a “Notice of Action” and “Pre-Penalty Notice.” The Environmental Protection Agency (EPA) calls it a “Request for Information.” The Commerce Department’s Bureau of Industry and Security (BIS) calls it a “Proposed Charging Letter.” The Transportation Security Administration (TSA) would call it a “Letter of Investigation.”

Whatever pseudonym or term is used, the government documents are all similar in that they:

(1) are a legal demand from the government,

(2) require a written response by the addressee,

(3) describe briefly the factual basis for the demand,

(4) threaten action against the company for not providing a timely response, and

(5) threaten action against an individual if false information is provided to the government.

The first response by the president of the company (or its general counsel) that receives the letter is – you guessed it – identify and call a lawyer very knowledgeable and experienced in handling these investigations. All communications between the company and its outside lawyer are considered to be under the attorney-client privilege. That means that anything the president or other employees of the company say to the attorney is entirely confidential. The inquiry by the outside legal expert is also confidential, so anything the attorney discovers or discusses with the company’s employees do not have to be subsequently disclosed to the government.

In my over 20 years of practice as a customs and international trade lawyer routinely involved in defending companies under investigation by the US government, the most common error by company officers I’ve seen is that they respond directly to the US government without seeking proper legal advice. Only after the company receives a large penalty do I finally get the call to straighten it all out. Fortunately, whether the letter of investigation is from Washington, D.C. to a company located in California, Florida, New York, or elsewhere in the US, the administrative procedures are identical.

Copyright © 2011, Becker & Poliakoff

About Peter Quinter

10 May 2012: Peter Quinter is now a Shareholder in the law firm of GrayRobinson and Chair of the firm’s Customs & International Trade Law Group. Based in the firm’s Miami and Ft. Lauderdale offices, Quinter principally represents persons and companies involved in international trade and transport. Editor of the GrayRobinson Customs and International Law Blog, Quinter is widely recognized for his expertise in international and trade law.

You can contact Peter Quinter at [email protected] or at (954) 270-1864.

The opinions expressed in this article are those of its author and do not purport to reflect the opinions or views or Descartes Datamyne. In addition, this article is for general information purposes only and it’s not intended to provide legal advice or opinions of any kind and my not be used for professional or commercial purposes. No one should act, or refrain from acting, based solely on this article without first seeking appropriate legal or other professional advice.

Date posted: February 17, 2011

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