In the Event of a Hostile Visit

Posted on Friday, July 06, 2018

In a dramatic pre-dawn raid, federal agents arrested illegal immigrant janitors at Wal-Mart stores across the country. That same morning in 2003, they also obtained a search warrant and seized several boxes of documents from the corporation's headquarters in Bentonville, Arkansas.

The Constitution And "Unreasonable" Searches

The Fourth Amendment to the Constitutionlimits the power of federal, state and local law enforcement officials to make searches and seize property. It defends rights against "unreasonable" searches and seizures. When is a search reasonable? In general, when:

The police have probable cause to believe they can find evidence of a crime and a judge issues a search warrant.
Circumstances justify the search without a warrant.

Although Wal-Mart officials announced they had no knowledge that the janitors working for a third-party contractor were in the country illegally and the corporation eventually settled the case, federal agents were reportedly searching for documents to prove the retailer was aware of the workers' immigration status.

Could law enforcement officials conduct such a search-and-seizure operation at your corporation? Do they have to have a search warrant before entering the premises.

A search of your business and its documents can be carried out if law enforcement officials have probable cause that a crime has been committed. In most cases, searches are conducted after officials obtain a warrant from a judge. Under certain circumstances, however, searches can be conducted without a warrant.

Search warrants are executed to find legal evidence in many types of cases, including tax fraud, health care fraud, environmental, banking and other "white collar" crimes. Warrants may also include, or be restricted to employees' property, lockers, workstations or offices.

If, for any reason, law enforcement officials or federal agents do appear at your door with a warrant, you must comply or risk charges of obstruction of justice. Nevertheless, you do have certain rights.

While this is a complicated area of law, in general, you can:

Review the warrant and supporting affidavits. Ask to make copies. Call your attorney. Fax the warrant and affidavits to your attorney, if possible.

Ask law enforcement officers or agents to wait while you consult with your attorney. (However, they may refuse.)

Escort agents to ensure that the search is confined to the areas and items included in the warrant. If the warrant describes materials relating only to specific contracts and the agent is attempting to search other files, make an objection. Don't agree to allow the search to be expanded beyond the warrant.

Observe the search and take notes. Request an inventory of anything that is removed from the premises or make your own list and request that it be verified. Give copies of notes and the inventory to your attorney.

Remain silent. Be polite and businesslike but don't volunteer information or answer questions. (However, don't attempt to influence an employee's decision to talk.)

If corporate managers or other employees agree to be interviewed, ask that the employees be informed of their rights and have access to legal counsel.

While the chances are small that your corporation will face a state or federal search and seizure, it may be a good idea to come up with a policy regarding any potential action. Five steps to consider:

1. Establish a management response team. Educate the team on warrants, their limits and how to respond.

2. Compile a list of emergency phone numbers, including your attorney's, and give copies to receptionists, security and management.

3. Prepare a list of rights that can be given to staff members in the event of a search and include the phone numbers of your attorney.

4. Set up a policy regarding the length of time to keep records in order to comply with all relevant laws. Destroy any that exceed that period.

5. Keep off-site backups of computers records and update them regularly. Seizure of computer hardware and software is a routine investigative technique.

Click here to read the Justice Department's specific guidelines for "Searching and Seizing Computers and Obtaining Electronic Evidence in Criminal Investigations."

Posted in Tax And Accounting Topics For Business

Disclaimer: The information contained in Dulin, Ward & DeWald’s blog is provided for general educational purposes only and should not be construed as financial or legal advice on any subject matter. Before taking any action based on this information, we strongly encourage you to consult competent legal, accounting or other professional advice about your specific situation. Questions on blog posts may be submitted to your DWD representative.