CIDs may be served by a vast number of different federal agencies. You might get one from the Attorney’s Office, Department of Justice, Federal Trade Commission, or the Consumer Financial Protection Bureau. Each of these agencies issues CIDs when they are doing civil investigations rather than criminal. However, that doesn’t mean you have nothing to worry about. Even civil violations can lead to thousands of dollars in fines. And if the investigation finds that you had criminal intent, the agency may begin a criminal investigation as well.
Businesses and individuals who have received CIDs need to react strategically to avoid consequences. There’s a very low chance that you’ll be able to avoid complying with the order, though you might be able to limit how much information you give up. If you submit an incomplete or late response, the agency will assume you have something to hide. Your chances of being prosecuted will go up. It’s vital that you understand both your rights and your obligations when dealing with federal agencies.
How Does a CID Work?
A CID is a subpoena that is often used by the DOJ alongside other agencies. Over the past decade or so, the document has begun to be used much more increasingly. Prior to 2009, the US Attorney General was the only one who could issue a CID. But the Fraud Enhancement and Recovery Act allowed this power to be wielded by people beyond the Attorney General’s Office. Now the documents are used in multiple types of investigations.
Since the subpoena is administrative, it does not need to be approved by a court. This means that federal agencies can issue a CID completely at their discretion. They can even do so before they’ve created any formal litigation. Even though there’s very little oversight into the issuing of CIDs, there’s also very little recourse if you want to challenge them. This means that businesses and individuals may find themselves needing to offer vast amounts of information without the approval of a judge.
CIDs typically request documents. They may request large volumes of documents. In fact, if a healthcare provider receives a CID, it’s common for them to need to offer several hundred thousand electronic and paper records. This can quickly become overwhelming, especially since the clock is ticking from the time of the subpoena. Failure to comply within a few days can lead to prosecution.
Reasons You Might Be Served
Most people have no idea why they’ve received a CID when they get it. Civil investigations tend to be a surprise. Since no litigation has been formally announced at this point in the process, there is no way to find out from the government what is being investigated.
As you respond to the CID, one important thing is to determine how you factor into the investigation. Are you a target, suspect, or witness? This stage is early enough in the proceedings that it’s difficult to tell, and you have no choice about your compliance no matter what. That’s part of why it’s helpful to hire a lawyer. They can analyze the language of the subpoena and draw conclusions about the situation.
Another important thing to note is that there are dozens of reasons that you might be served a CID. Not all of them mean that you or your business is in trouble. You can’t assume that you understand what investigation is happening, and you shouldn’t talk to federal agents without having a lawyer present.
You must comply with a CID, although your attorney may be able to make minor modifications through negotiations with the agency or a federal court. The big risk is that the information will be sufficient to use in a criminal or civil proceeding. A lawyer can help prepare your response to mitigate this chance as well.