Lawyer Monthly Magazine - August 2019 Edition

How do you undergo an investigation when instructed on a case? An Expert Witness assignment will always begin with an enquiry from a law firm or in-house legal counsel representing either the complainant or the respondent/ defendant. At the enquiry stage, the instructing legal counsel will clarify the nature of the case, the expertise required, the scope of the report required, the timetable for the report and whether the instruction will be to report to one party or whether it is to act as a Single Joint Expert. We will then carry out an internal check to see whether the firm or anyone in the firm has previously acted for or provided services to either the complainant or defendant (a conflict of interest assessment). Assuming there is no conflict of interest, we will confirm the same to instructing legal counsel and prepare a cost estimate. Based upon this legal counsel will normally then issue formal instruction and provide relevant documents to us (known as an evidence bundle). The letter of instruction will normally set out exactly what the Court has agreed it requires the Expert Witness to investigate and report on. This will normally be quite specific and is designed to assist the parties and the Court to resolve the case. The Expert will then read the evidence bundle and analyse the evidence it contains in the light of the specific matters and issues that the Expert has been instructed to report upon. This can be quite time consuming. Here we speak to Paul Grainger about client money rules and investigations the FCA carries out. Once the evidence has been analysed and taken into account, the Expert can then form a view relating to the specific matters and issues as requested in the instruction letter. The Expert will then prepare a report setting out his or her opinion. Unless the Court has appointed a SingleJointExpert,itisnormallythe case that both the complainant and the defendant will have instructed Expert Witnesses. Where this is the case, the Expert Reports are exchanged between the complainant’s and the defendant’s legal teams. The relevant experts are then required to review the other expert’s report and identify areas of agreement and disagreement. The experts will then normally hold ameeting to formally devise a statement of agreement and disagreement. This is a formal written report setting out the points in each other’s reports where they agree and those points on which they do not agree. This Statement of Agreement and Disagreement is also provided as evidence to the parties and the Court. If a case proceeds as far as a trial, it is possible that the expert witness will be called upon to give evidence in Court and to be subject to cross-examination by legal counsel acting for either the complainant or the defendant. In my experience, most cases have been resolved before they get to trial. The expert witness reports are often helpful in reaching an agreement between the parties on areas of dispute, thus enabling settlement of the case without the need for a lengthy and expensive trial. What are client money rules? The client money rules are a part of the rules (Handbook) in which the Financial Conduct Authority (FCA) sets out how firms that it regulates should keep safe the client money and client assets that they may hold. These detailed rules and procedures are set out in the FCA Client Assets (CASS) sourcebook. The rules and procedures set out how client money and client assets should be accounted for and kept separate from an investment firm’s own money or assets. The rules arealsodesigned to ensure the speedy return to clients of the client money and/ or client assets in the event of the failure of an investment firm. What usually occurs during an FCA visit and how should firms prepare for it? The FCA normally only carries out supervisory visits to the vast majority of regulated firms as part of a thematic review of a part of the financial services sector or in response to regulatory concerns raised via desk based monitoring or similar information that has come to the attention of the FCA. The FCA will already have a lot of information about the firm and its senior managers because of the regular regulatory and financial reporting that FCA regulated firms have to make during each year. What Happens in a Client Money Investigation? CLIENT MONEY “ Always remember that in a dispute, in regulatory investigations or in litigation, the other party will often take the view that if it isn’t written down, it didn’t happen. 50 WWW.LAWYER-MONTHLY.COM | AUG 2019 Expert Witness By Paul Grainger, Complyport