Derek structures and delivers forensic accounting and data governance services across multi-jurisdiction investigations, assessment and testing of compliance programmes, and supports complex dispute resolution matters. Derek heads FRA’s Nordic offices and data centre services. Recently, he has co-led FRA’s forensic support of an independent monitor appointed under an FCPA resolution with the DOJ and the SEC, and has supported investigations into money flows through the Baltic states. Derek advised Telia Company in its multi-jurisdiction bribery investigation and resolution.
What inspired you to pursue a career as an expert given your previous work as a corporate executive?
I was lucky to have enjoyed senior roles in finance in major international businesses (Ford Motor Company, British Airways) as well as entrepreneurial growth companies (Go Fly, easyJet) in my career before FRA. I was introduced to the founders of FRA by a mutual friend and realised that here was a great opportunity to use the skills gained in the commercial world to advise and guide clients.
What is the most memorable case you have worked on as a forensic accountant?
The most memorable cases have been the cross-border investigations and settlements. The complexities, scale and challenges promote the need for problem-solving and communication, and the use of technology in a way that can be clearly communicated to and understood by various stakeholders in the case. That counts as fun (and memorable) for me – when the client is delighted with the outcome, and the outcome is robust and defensible.
How do you manage the challenges of big data in investigations?
With care! Data legislation complexity is growing significantly. Technology has a vital part to play for sure in handling big data efficiently and defensibly but the operating framework within which it is deployed requires a lot of care and attention, and calls for precise advice and procedures. This requires the cooperation of internal and external counsel; data protection officers and IT functions; and forensic accountants and investigation teams. Teamwork is vital.
Over the next few years, what role do you think AI will play in the kinds of work you do?
As the data that compliance professionals and investigators have to manage continues to grow exponentially in volume and complexity, the technology used to tackle data must also evolve. We are already using AI technology to help identify key patterns, isolate potential red flags, visualise data, redact, restrict and more. In the near future, AI will allow us to not only synthesise structured data but also integrate findings from the review of unstructured data. However, human input is essential when designing these systems to “ask” the right questions, and this process will require ever-closer collaboration between lawyers, forensic accountants and data experts. FRA is already preparing to serve this need through an exclusive partnership with software company Infinnium. We will offer our clients a modern AI technology platform that will enable them to streamline processes; reduce redundancies; and reduce risk associated with data management and governance.
To what degree has the compliance field experienced a shift in the burden of responsibility from authorities to corporates?
A multinational company that wants to cooperate with an investigating authority in one place may fall foul of a different authority in the process, due to blocking statutes or industry-specific data restrictions. It is worth noting that enforcement agencies around the world are also grappling with the implementation of these emerging laws and regulations, and may not be available to offer pre-emptive advice to the degree and level of urgency that a company might want.
You lead FRA’s Nordic team. Do you anticipate any significant legislative or regulatory changes for the region in the coming years?
The major changes I anticipate developing here are international businesses responding to non-domestic regulatory pressure, and to the growing pressure from investors and society (for example, investigative journalists). Nordic business has long operated on the basis of trust, and international businesses are adapting to preserve that important element but support it with additional compliance and verification practices. Governance and legislative change is coming too, and in the long-run will be helpful for corporate behaviour – I see France as a pathfinder for the Nordics in that regard.
Where, in your opinion, does the future of forensic accounting lie?
Good, pragmatic, authoritative advice will never go out of fashion, that’s for sure. However, increasingly the ability to deploy and manage a flexible mix of skilled consulting teams with appropriate technology will be vital, and this emphasises the need to be able to communicate clearly and robustly. In the investigative space, forensic accountants increasingly need to be able to speak to and operate within a web of ever-increasing data regulation. Plenty of developments!
Derek has in-depth experience in structuring and delivering forensic accounting and electronic data services across multi-jurisdiction investigations, assessment and testing of compliance programmes; and in supporting complex dispute resolutions. Derek leads FRA’s Nordic business, and recently helped Telia Company respond to bribery allegations arising from its Uzbekistan business, and with disgorgement and pecuniary gain analysis in its $965 million FCPA settlement. Derek is presently co-leading FRA’s compliance programme, testing an international corporation as part of the independent compliance monitor team appointed under a DPA.
DESCRIBE YOUR CAREER TO DATE.
I have been involved in accounting and finance since my studies at university. Beginning in audit and insolvency sectors at Pricewaterhouse, I moved to industry and was lucky enough to have enjoyed senior roles across the finance function in major international businesses, as well as entrepreneurial growth companies (Go Fly, easyJet). I joined FRA when it was considerably smaller, and I am delighted to have been part of the company growth to over 250 employees. At FRA I have led a variety of engagements including proactive compliance and cultural reviews, fraud, corruption and regulatory investigations, as well as post-regulatory settlement monitorship forensics. In the litigation and arbitration fields I have led a variety of engagements assisting clients and counsel with e-discovery and forensic accounting services, and have overseen a portfolio of litigation supported by litigation funding.
HOW DOES YOUR PREVIOUS IN-HOUSE EXPERIENCE, WITH COMPANIES SUCH AS FORD MOTOR COMPANY, BRITISH AIRWAYS AND EASYJET, HELP YOU IN YOUR ROLE AS A FORENSIC ACCOUNTANT?
Knowing the challenges faced by international businesses in key functions such as audit, accounting, reporting, IT and procurement, and how they fit together and operate effectively, is incredibly useful when assisting clients in both proactive and reactive circumstances. It helps deliver pragmatic and useful advice, and to structure workstreams in a way best suited to the client’s environment. In addition, the knowledge of how best-in-class financial and operating controls should operate, and how a strong finance culture can work is hugely beneficial when assessing and testing an international businesses internal and financial control systems.
WHAT DO YOU ENJOY MOST ABOUT WORKING IN FORENSIC ACCOUNTING?
Forensic accounting is a fantastically challenging and rewarding arena to work in – those with well-rounded personal and professional skills and experience will have a great opportunity to progress.
WHAT QUALITIES MAKE FOR A GOOD TESTIFYING FORENSIC ACCOUNTANT?
The ability to set out facts and standards clearly, and how they support conclusions and opinions, is very important, as is knowing how to deconstruct complex issues into a series of logical points. Being able to think about an issue from different perspectives is helpful when considering how best to present or describe an issue.
WHAT ARE SOME OF THE CHALLENGES OF WORKING ON INVESTIGATIONS SPANNING MULTIPLE JURISDICTIONS?
Data, data and data. And proportionality. The need to collect, efficiently process and then query huge volumes of transaction and unstructured data in international investigations is vital. Solutions that are technically robust and proportionate, and which enable forensic accountants and counsel to conduct substantive review together efficiently, are increasingly required. Technology-assisted review is the pragmatic way forward, something that courts and regulators are beginning to accept. These challenges add project management, interaction with techy folks, and client interface skills to the traditional requirements of forensic accountants.
WHAT MAKES FRA STAND OUT FROM ITS COMPETITORS IN THE MARKET?
The firm offers outstanding service, and flexible and pragmatic solutions and advice.
Projects now require the forensic accountant to be able to intelligently advise clients on a wider range of challenges. Most large white-collar projects now combine forensic accounting requirements, structured and unstructured data challenges, and project management needs. One of our beauties is that we offer all of those skills to clients in one flexible package, which is enormously helpful to internal and external counsel. Every project presents different challenges and we are able to listen and offer tailored, pragmatic solutions. Experience of the day-to-day challenges faced in international businesses is really useful in this regard. Clients greatly prefer this to having a “product” forced upon them.
YOU HAVE ENJOYED A VERY DISTINGUISHED CAREER SO FAR. WHAT WOULD YOU LIKE TO ACHIEVE THAT YOU HAVE NOT YET ACCOMPLISHED?
There is so much to do! Next on my plate is to continue to work with our talented folks to build further on our established track record in the Nordic region. It’s a really intriguing opportunity, and we have already been expanding our client base, hiring and establishing local offices.
WHAT IS THE BEST PIECE OF ADVICE YOU’VE EVER RECEIVED?
Hire people who are smarter than yourself.
Derek Patterson is widely respected for his strong international experience, working across numerous jurisdictions including the UK, Russia, Switzerland and the US.
Derek Patterson is a principal at FRA’s London office and head of its Nordic business. He has in-depth experience in structuring and delivering forensic accounting and electronic data services across multi-jurisdiction investigations, assessing and testing compliance programs, and in supporting complex dispute resolutions.
He has worked on a variety of complex frauds, and on bribery investigations, in multiple jurisdictions. Most recently Derek supported Telia Company’s response to bribery allegations arising from its Uzbekistan business, and with disgorgement and pecuniary gain analysis in its US$965 million FCPA settlement with the DOJ, the SEC and the Netherlands. Derek also assisted Rolls-Royce in the civil aerospace component of its settlement with the SFO and DOJ. Prior to that Derek led the FRA team assisting Alstom respond to bribery allegations leading to regulatory settlement in Switzerland, and supported investigations in the US and the UK. He also provided factual evidence to the Austrian Courts with respect to a securities and real-estate fraud claims totalling over €2 billion. Derek is presently co-leading FRA’s compliance programme testing of a global corporation as part of the independent compliance monitor team appointed under a DPA.
Prior to joining FRA, Derek was the group treasurer for easyJet plc, a senior member of the MBO team, which bought and sold the low-cost airline “go fly” at British Airways plc, and worked in Ford Motor Co in financial control and internal audit roles. Derek completed his training as an accountant and auditor with PricewaterhouseCoopers and holds a bachelor of accountancy degree from the University of Glasgow.
The "fantastic" Derek Patterson is a "very strong forensic accountant" according to market commentators.
Derek Patterson is a principal at FRA's London office and head of its Nordic business. He has in- depth experience in structuring and delivering forensic accounting and electronic data services across multi-jurisdiction investigations, assessing and testing compliance programs, and in supporting complex dispute resolutions.
He has led a variety of complex fraud and litigation, financial crime and bribery investigations, in multiple jurisdictions. Derek supported Telia Company's response to bribery allegations arising from its Uzbekistan business, and with disgorgement and pecuniary gain analysis in its US$965 million FCPA settlement with the DOJ, the SEC and the Netherlands. He also supported a major Nordic bank response to allegations of money laundering. Prior to that, Derek led the FRA team assisting Alstom's response to bribery allegations leading to regulatory settlement in Switzerland, and supported investigations in the US and the UK. Furthermore he has provided factual evidence to the Austrian courts with respect to a securities and real-estate fraud claims totalling over €2 billion. Derek also jointly led FRA's compliance program testing of a global corporation as part of the independent compliance monitor team appointed under a DPA. In addition, Derek has conducted a wide variety of compliance program assessments, internal audit reviews, controls testing, and related third-party distributor and agent reviews.
Prior to joining FRA, Derek was the group treasurer for easyJet plc, a senior member of the MBO team, which bought and sold the low-cost airline "go fly" at British Airways plc, and worked in Ford Motor Co in financial control and internal audit roles. Derek completed his training as an accountant and auditor with PricewaterhouseCoopers and holds a bachelor of accountancy degree from the University of Glasgow.