NACDL

Frying pan or fire? From the perspective of many public corporations in the United States, that seems to be the choice when it comes to internal investigations — especially investigations that delve into e-mails, Microsoft Word documents, and other electronic records. A company that exercises lax oversight exposes itself to shareholder suits and, possibly, criminal investigations. Enron, WorldCom, and the rest of the accounting scandals that produced the Sarbanes-Oxley Act provide the clearest examples of the “lax oversight” risk. On the other extreme, a company that investigates with too much vigor runs the risk of violating the privacy rights of employees and others swept up in the investigation.

While structuring an appropriate internal investigation poses a daunting array of challenges, this article focuses on the preservation and processing of electronic records. This is a key element of any corporate investigation. Companies that handle it properly a