Wednesday, May 1, 2019

New DOJ Policy on Evaluation of Corporate Compliance Programs

DOJ issued a new Guidance Document on Evaluation of Corporate Compliance Programs (here).
Some thoughts -

  • Prosecutorial discretion remains as the document states - "Because a corporate compliance program must be evaluated in the specific context of a criminal investigation, the Criminal Division does not use any rigid formula to assess the effectiveness of corporate compliance programs."
  • The three "fundamental questions" that a prosecutor should ask are: "1. 'Is the corporation’s compliance program well designed?' 2. 'Is the program being applied earnestly and in good faith?' In other words, is the program being implemented effectively? 3. 'Does the corporation’s compliance program work' in practice?
  • But the document is also quick to note that there is no checklist in answering these questions as it states "In answering each of these three 'fundamental questions,' prosecutors may evaluate the company’s performance on various topics that the Criminal Division has frequently found relevant in evaluating a corporate compliance program. The sample topics and questions below form neither a checklist nor a formula. In any particular case, the topics and questions set forth below may not all be relevant, and others may be more salient given the particular facts at issue."
  • The document then goes on to provide some clues as to what DOJ will look at in its evaluation process.

Bottom line - The document provides a helpful structure for someone making a presentation to the government on why they should not be prosecuted or at the most get an NPA or DPA. Methodically going through this document and demonstrating a company's case for getting corporate compliance program credit will likely make for a longer presentation to the government.


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