Ron Sarachan’s and Tracy Schloss’s article “Avoiding Willful Blindness Allegations” was published in the July 3, 2013 edition of Inside Counsel magazine.
In the article, Ron and Tracy discuss “willful blindness,” a term used in situations where an individual deliberately avoids knowledge of facts that would expose him to civil or criminal liability. In willful blindness cases, white collar prosecutors often point to “red flags” which they claim should have alerted the defendant to criminal activity. Failure to ask the right questions can indicate deliberate avoidance of knowledge to a prosecutor, court or jury.
The article concludes that, regardless of the nature of the “red flag,” evidence that a defendant investigated suspicious activity is powerful evidence that he or she did not close his or her eyes to knowledge of illegal activity. Therefore, it is important to remind corporate personnel that -when faced with possible “red flags,” they should act to protect the interests of their company and themselves by asking probing questions at the time the suspicious activity is brought to their attention, and by carefully documenting their investigative actions and following up as needed.
Ron Sarachan is a partner in Philadelphia and co-chair of the White Collar Criminal Defense and Corporate Investigations Group. Tracy Schloss is a Philadelphia associate in that Group.
To view the entire article in Inside Counsel, click here.