Welcome back to the Fides Weekly Update. After taking on the feedback from our wonderful readers, we have added a movers and shakers section to our newsletter, keeping you updated on all the key moves in the legal market. Plans are also afoot to expand our coverage into Compliance.
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1) Deferred Prosecutions
We finally saw the Serious Fraud Office (SFO) use a deferred prosecution agreement (DPA). This did bring a huge smile to our faces at Fides Search, not only because it’s new or novel, but because it has the opportunity to change things. We are well aware of DPAs or NPAs having worked with US law firms and international institutions; it is not a new concept to the energy sector and it certainly isn’t new to many of the Banks. What is new however, is that an institution cooperated with the SFO to the extent that it was deemed in the public interest to grant a DPA.
Just how far must the legal team at Herbert Smith Freehills have gone to cooperate with the SFO and who should be celebrating? It is really hard to say, but at a recent talk where we saw both David Green CB QC, Director of the SFO and Andrew Weissmann, Chief of the Fraud Section of the U.S. Department of Justice’s Criminal Division sit opposite one another and broach the subject, it became clear that change really isn’t set to come fast.
Although it may be seen as a victory for the defence, Fides Search has worked with a number of institutions subject to a DPA. Although the prosecution is deferred, the impact it can have on an institution remains huge, in particular if you look at the effect of having a monitor imposed on an institution. Fessing up to your actions means that you have no defence and nowhere to hide, alongside the pressure of continuing to cooperate. The impact this can have on an in-house legal and compliance team’s resources is huge and costly. The monitor consumes vast internal resources, and because they systematically thrall through the institutions practices, teams need to be established to deal with the various challenges of the investigations. The follow on work can also lead to external investigations and painful changes to the way an institution is run.
Although this is the first decision of its kind in the UK, our feeling is that it is still a difficult pill for any institution to swallow and that the comments of Ben Morgan, joint head of bribery and corruption at the SFO, are not necessarily required. The huge downside an institution faces when going down this route is likely enough to remove any complacency around the notion that it is light touch enforcement.
2) In-House Bonus Season or not?
Director Ed Parker has taken a look into what the forecast will be for this year’s in-house bonuses, and whether the lack of information being reported on this topic may be a sign. Please see our blog for more detail.
3) PwC Legal hire A&O China head
Joseph Tse, former Greater China senior partner at Allen & Overy (A&O), has joined PwC Legal only a few months after retiring from the magic circle firm.
We have noticed various departures from A&O’s Asian offering in recent years, such as corporate partner Linda Lee joining Cary Olsen’s Singapore office. The notable factor in this hire is how the big four continue to attract high-profile legal talent, not just in London, but also internationally. We have begun to track these moves, as their intentions gradually become clearer. Earlier this year, EY hired ex-BLP finance head Matthew Kellett to their legal team alongside Philip Goodstone, former corporate managing partner at Addleshaw Goddard, and laterally Paul Devitt in Manchester.
It remains to be seen what long-term impact Alternative Business Structures (ABS) could have on the legal market. However, it does give the move to a big four a great deal of legitimacy when senior equity partners are seeking out such career moves.
The race for talent is a complex one, and most of the searches we undertake are competitive, often in areas where there are multiple buyers. The entry of non-legal firms into the market has been impressive, and they look set to create more competition into this space.
Movers and Shakers of the week
Linklaters in the market for China merger
Linklaters is in advanced discussions with two Shanghai-based firms, Shanghai Capital Law & Shanghai Kai-Rong Law Firm.
Dentons plans to launch in Latin America with Colombia’s Cárdenas & Cárdenas, and Mexico’s López Velarde, Heftye y Soria.
DLA continues hiring spree in Germany
DLA Piper has added a team of seventeen to their Hamburg office. Five partners, four counsels, one of counsel and seven associates have been appointed, joining their Intellectual Property & Technology (IPT), Corporate and Regulatory practices.
MoFo bulks up London team with double partner hire
Partners Peter Declercq and Sonya Van de Graff will take their places in Morrison & Foerster’s restructuring and insolvency group, joining from Schulte Roth & Zabel.
Linklaters appoint new International Arbitration heads
Matthew Weiniger QC and Pierre Duprey have become Linklaters’ new co-heads to their international arbitration practice.
Corporate Partners Giles Beale and James Wilson have joined Holman Fenwick Willan’s London office from Reed Smith.