By Robina Clough
A number of reported lateral moves within the white collar crime arena this year show the appetite of both UK and US law firms to recruit in this area remains strong, a trend that has been growing over the last two years.
Even before the Bribery Act (the Act), white collar crime was becoming increasingly important to City firms due to the newly invigorated (and highly staffed) Financial Services Authority (FSA) investigating some matters with quasi-criminal powers.
Whilst there is a case for some law firms jumping on the corporate crime bandwagon by “buying business” in this field (i.e. hiring a partner or team with following), in all likelihood the traditional stomping ground of such experts would have been in lower tier (albeit highly specialised) firms where charge out rates are significantly lower. Trying to convince a client to pay double the fees for essentially the same work is never really going cut it, no matter how glossy the brochure.
More likely, firms are looking to bring on a new technical skill set to blend with the traditional City finance and tax investigatory teams. Packaging up white collar crime with these already established practice areas gives more scope to command commercially viable fees for what has previously been left to the niche firms. Also, the volume of work now associated with the increased scrutiny of Directors and Officers ties in very nicely with the insurance market.
But what has really set the firm-hopping in motion in the last six to twelve months is the much-hyped Bribery Act, which eventually came into force in July of this year. The potential increased risk the Act brings to corporate boards has got institutional clients picking up the phone to their lawyers, preferring the “act now” rather than “pay later” approach.
For law firms, the appetite seems to be bringing in both existing private practice partners as well as investing in the expertise of in-house specialists from regulatory bodies who are well versed in either the Bribery Act specifically, or the general rules and regulations of the UK financial market. Some notable moves in the last 12 months include: Daren Allen from DLA Piper moving to Berwin Leighton Paisner; Herbert Smith hiring Allen & Overy partner Robert Hunter and Serious Fraud Office (SFO) lawyer Graham More; Andrew Picken joining McGrigors from The Khan Partnership; and Jo Rickards and Duncan Wiggetts becoming partners at DLA Piper from Peters & Peters and PricewaterhouseCoopers respectively.
It’s not just domestic law firms that are beefing up their expertise in this area. The significant tightening up of the Foreign Corrupt Practices Act on the other side of the pond means that US firms, at least back in the US, are one step ahead of the UK in terms of the depth and breadth of their corporate crime capabilities. More recently, however, this has filtered across to their London-based offices and some significant lateral hires have taken place this year: Neil Gerrard and Jonathan Pickworth have joined Dechert from DLA Piper; Willkie Farr has hired Herbert Smith’s Head of Investigations & Corporate Crimes practice, Peter Burrell, in what is a very rare non-US lateral hire for them; Vivian Robinson QC joined McGuireWoods from his senior position at the SFO; Covington & Burling has also bought in SFO expertise with the hire of Robert Amaee who was head of the Anti-Corruption and Proceeds of Crime units; and more recently Sullivan & Cromwell has brought in Louise Delahunty from Simmons & Simmons, having previously worked at white collar crime specialist Peters & Peters.
In reality, the top City firms are currently likely to be taking instructions from corporate giants who need to ensure “best practice” by showing adequate anti-bribery procedures are in place across their subsidiaries and international operations. But there is also plenty of scope for mid-market firms to get in on the act by advising smaller corporate entities and representing individuals facing disqualification. It is more than likely, then, that we will continue to see movement at lateral partner level (and more increasingly at assistant solicitor level) throughout the remainder of this year and well into next. It would be naïve for law firms to believe they can sit on their hands and wait until the floodgates open before bringing in the necessary expertise.
Follow Edwards Gibson's market updates on Twitter