A formal inquiry conducted by a government authority (such as privacy commissioners or industry regulators) into potential violations of laws or regulations. These investigations often follow data breaches, privacy violations, or compliance failures. During an investigation, regulators can request documents, conduct interviews, and examine your business practices. The process can result in warnings, fines, mandatory corrective actions, or public disclosure requirements. Insurance policies may cover the legal costs of responding to investigations and some resulting fines (where legally insurable), but typically won't cover penalties for deliberate wrongdoing. Having proper compliance procedures and documentation before an investigation starts can significantly reduce potential penalties and help with insurance claims.
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