With the expansion of large multinational corporations into developing countries such as Russia, Brazil, India, Mexico and China, a proliferation of global regulatory enforcement actions, including anti-bribery and anti-corruption, has risen. Recently, HP Russia paid more than $108 million in fines for Foreign Corrupt Practices Act (FCPA) violations that occurred when its subsidiaries in three different countries, Russia, Poland and Mexico, made improper payments to government officials to obtain or retain lucrative public contracts.
Executives, including general counsel, compliance and risk officers, are smart to plan in advance for potential regulatory investigations. The disclosure, or production, of information that might be relevant to the allegations from the requesting regulatory bodies–part of the electronic discovery in the legal realm–is complex, costly and time-consuming in today’s world of information. It involves the identification, acquisition and review of information and communications from a myriad of sources, including day-to-day operations, financials, communications with foreign and government officials, employees and third party representatives, system data reporting, travel and entertainment expenditures, payment data, chat messaging, social media posts, and the like. All of this information is subject to scrutiny by legal counsel and the requesting regulatory body to determine whether there was any wrongdoing.
When some information is in one or more foreign languages, the document review process can become significantly more unwieldy and inefficient. Understanding and implementing best practices is critical for making the process easier.
First, legal counselmust determine how the document collection breaks out into categories that may contain evidence of the allegations. They will typically work with compliance and risk departments within the corporation, along with lines of business, to identify the categories of information they need to capture.
When the document collection contains foreign languages, it is important to engage a search expert with knowledge in linguistics and search syntax. A search expert can identify the languages contained in the document collection, and craft search terms and filters to run across the foreign language documents to hone in on potentially relevant documents during the search.
Second, once the data is searched, the review team will conduct an initial review of the documents captured by the search. The goal is to classify the documents by categories that have been defined that are deemed relevant to the case. Following the initial categorization, the legal teams will undertake a more in-depth review and analysis.
An alternative strategy to reviewing foreign language documents is to simply translate those documents deemed important by the case team. In this scenario, documents are reviewed in the case team’s native language. For example, typically documents are translated to English for a U.S.- or U.K.-based case team, but translation to alternate languages can be done for members of the case team based in other countries.
The Challenges in Reviewing Foreign Language Documents
Since regulatory investigations—and particularly the document review phase–are fast-paced, the idea is to anticipate the challenges and be able to simplify the process, allowing counsel to make decisions faster and in better alignment with investigatory bodies.
Language is complex. It’s fairly straightforward to translate an email from one party to another describing a payment to a third-party intermediary that coincides with a discussion on the timing of a sale of assets. However, depending on the language, colloquialisms and slang can dramatically influence the interpretation and context of the document text. This is heightened by lingo that is prevalent across SMS, chat, social media and other newer communication vehicles. For example, in English, lingo-savvy professionals might easily discern “afaik” as “as far as I know,” “nething2+” as “anything to add?” and “pcm” as a request to “please call me.” But what about an email in another language that contains obscure slang, or the chat message that contains a messaging style commonly known only to the speakers of the native country? How does one capture innuendo that could indicate improper conduct?
When a corporation is involved in a cross-border legal or compliance matter, it needs to comply with the host of data privacy provisions in the foreign country. This is no simple matter.
Regulatory reviews frequently deal with multiple countries, forcing the corporation and its outside counsel to evaluate the following: how best to set up proper access controls to the secured data, where to conduct the document review (either in-country or elsewhere if permitted), and how to define the types of protected or classified data for redaction, to comply with privacy rules. This includes personally identifying information (PII), payment card information (PCI), medical records, HIPAA, and geolocation data. While most categories of protected information are easily recognizable, privacy requirements and formats can vary across countries, adding an additional layer of complexity to work through.
For jurisdictions that require in-country review, the legal and review team must ensure that they adequately perform the work without violating the country’s restrictions. Within the European Union framework, for example, France and Germany have additional restrictions beyond the European Union directive that require additional navigation; in Asia, China has strict state secrecy laws that could pose issues if a government official monitors a potential violation during an in-country review.
Corporations undertaking cross-border reviews also will need to involve appropriate parties, including its data privacy officer, outside counsel and third-party electronic discovery vendors, to develop a defensible strategy that address the issues of legally acceptable data transfer and processing. (In an e-discovery context, processing refers to the extraction and manipulation of metadata—or data about the data—to create information that can be searched.)
The costs of document review can be difficult to estimate. Legal teams often spend more than initially estimated due to findings that necessitate additional or secondary review, and/or successive information requests are sent to the corporation by the regulatory agency that expands the original scope of the inquiry.
When a review includes substantial foreign language documents, costs can quickly skyrocket. Foreign language review and translations involve specialized skill sets and qualifications, and the fees associated with this type of work depend on numerous factors: the language being reviewed, the task required (i.e., document review versus translation work), the location of the review, whether the review is onsite or in-country, and whether special background screening for these resources are required, such as Department of Defense secret clearance. On top of that, since document review work in any foreign language is typically slower than English language reviews, the expected turnaround time on foreign language documents may exceed that of English language document reviews, adding additional time and cost.
Industry and Domain Expertise
Finally, the industry itself that is subject to the investigation might contain relevant foreign language documents that are difficult to translate. For example, a financial services institution engaged in alleged payment misconduct might very well need to review trading activity and future trading intentions with clients, group chats between traders and salespeople and orders received to identify potential evidence of front-running or anticompetitive conduct.
How to Make Foreign Language Review Easier
It’s easy to get foreign language review wrong, and success depends on the right strategy, the right technology and the right aptitudes by those carrying it out.
1. Use the Right Technology
Be smart about the technology you use to support the review. It can save significant costs when applied appropriately to foreign language documents and simplify the process. Legal teams should use a review platform with advanced features and analytical capabilities for addressing foreign languages, and understand the capabilities that the selected platform has for the languages. For Asian languages in particular, it is important to confirm how the platform treats non-English characters during the processing, search and analytics phase of the review.
Review platforms that can analyze concepts and relationships in specific languages can quickly provide insight into who is speaking with whom and identify emerging behavioral patterns that may be indicative of wrongdoing.
Predictive analytics is another useful tool, as it can suggest categories of documents to review. Similarly, machine translation can render a broad translation of documents that will help with categorizing potentially relevant document sets. Both of these methods can yield significant time and cost savings by streamlining the process.
It is also critical to understand which tools to apply to native electronic documents, and which to apply to hard copy documents that have been digitized through imaging. Concept analysis, predictive coding and machine translation are best suited to native electronic since these technologies take advantage of the available metadata and full text of electronic files. Generally, digitized hard copy documents are best reviewed in the specific foreign language rather than utilizing machine translation, since the quality of automated translation results rely heavily on the quality of the optical character recognition (OCR) generated from these documents.
2. Engage Experienced Professionals
Many problems that arise in a foreign language review and translation project are the result of a lack of training and experience. It is important to involve professionals who are experienced in the compliance and regulatory field, as well as fluent in the particular language. (ALTA Language Services is the standard in testing language proficiency levels in the legal review world.) Professionals with both native knowledge of the language and industry knowledge of the specific case or familiarity with FCPA and regulatory laws can also provide insight and assist with development and clarification of search terms and syntax, as well as provide education on terms of art, regional dialects, geographic-specific business terms, and conversational quirks—including formal, proper and casual.
Professionals should also be able to verify and attest to the quality of the translated work with a Certificate of Accuracy (COA). Since this type of certification can be requested by the Department of Justice, Securities and Exchange Commission and some courts, engaging with translators with prior experience translating and certifying work for large government or international monitoring bodies such as the DOJ, Central Intelligence Agency, Department of Homeland Security, The Hague and the United Nations is ideal.
3. Be Proactive with Internal Compliance Monitoring
Many companies that have violated the FCPA, or those that may be at risk due to rapidly expanding business operations outside of the U.S., engage in on-going compliance monitoring. Much like document review, large amounts of data can be filtered to the important facts. Such activities, whether conducted by an internal team or a third-party vendor, help flag potential illegal activity, identify isolated incidents and create alerts to systematic issues that will need to be remediated.
Navigating the Path Forward
As corporations recognize that expanding their business operations to developing countries gives them strategic growth opportunities, they are also positioning themselves for increased regulatory, financial and operational risks–and the scrutiny that comes with them. Tough anti-corruption legislation by countries outside of the U.S. and newly created regulatory bodies are steadily surfacing to ensure that multi-national companies do not partake of inappropriate activities. The increased globalization holds implications for how companies tackle these investigations, particularly those involving multi-language review. With an understanding of the potential challenges, along with a measure of planning, legal teams can better prepare for—and simplify–foreign language review.