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Abuse of Information

 

The abuse of confidential information is becoming a more and more serious problem.  There are now individuals who make a full time and very good living from broking confidential information.

 

A typical scenario would be where a large company proposes to make an investment on the ground in a new jurisdiction.  They have carefully scouted out the jurisdiction and carried out some diligence on the parties with whom they anticipate contracting.  They have to work to budgets and a project schedule.  Much to the surprise of the company, when they start approaching to contract for services in the new jurisdiction, they find that they are always quoting at budget level.  It takes a while for them to learn that the information that they have compiled for the purposes of their budgeting has been acquired by an information broker who is then selling this information to the potential contracting parties in the jurisdiction.

 

The only real way to deal with this sort of issue is either to pursue the information broker using domestic intellectual property laws or to ensure appropriate security in the first instance.  The real answer is to carry out appropriate diligence on likely contracting parties, particularly those who are going to have access to budget sensitive information.

 

Further and quite different abuse of information is the utilization of “inside knowledge” in order to set up inflated invoicing scams.  This works where an individual or a group of buyers in a company approve invoicing with confederates that has been inflated.  They then typically split the differential between cost and the hugely inflated profit.  These cases are time consuming in so far as there has to be a thorough audit of past invoicing.  The result of discovering evidence is normally dismissal and actions commenced for recoupment of monies where they can still be recovered.  These issues usually can be confined to one or two jurisdictions rather than a multi jurisdictional legal operation.