Tuesday, June 10, 2014
Court E. Golumbic and Albert D Lichy have posted The 'Too Big to Jail' Effect and the Impact on the Justice Department's Corporate Charging Policy (Hastings Law Journal, Vol. 65, No. 5, 2014) on SSRN. Here is the abstract:
In the wake of the 2008 financial crisis, the failure of the Department of Justice (“Justice Department” or “DOJ”) to bring criminal charges against any financial institutions prompted critics to question whether the DOJ maintained a policy that certain corporations are “too big to jail.” The criticism piqued after the DOJ announced that it had entered into a deferred prosecution agreement (“DPA”) with HSBC to resolve a massive money laundering and government sanctions investigation.
This wave of criticism is the backdrop for what the Authors call the “too big to jail” effect — two related developments, each of which has the potential to impact the future of DPAs in the corporate crime context.
This Article examines the impact of the “too big to jail” effect on the Justice Department’s corporate charging practices. The Authors argue that DPAs should not be abandoned. Instead, Congress should amend the Speedy Trial Act to require substantive, judicial review of the terms of DPAs. To this end, the Authors propose a standard of review that is designed to maximize the benefits of DPAs, while minimizing the concerns that have historically accompanied their use.