Thursday, January 19, 2023
On January 17, 2023, Assistant Attorney General Kenneth A. Polite, Jr. Delivered Remarks on Revisions to the Criminal Division’s Corporate Enforcement Policy, in which he stated, "The policy is sending an undeniable message: come forward, cooperate, and remediate." The new guidance provides:
Accordingly, the Criminal Division is issuing this revised Policy, effective on a prospective basis as of January 2023, which provides, inter alia, that when a company has voluntarily self-disclosed misconduct to the Criminal Division, fully cooperated, and timely and appropriately remediated, all in accordance with the standards set forth below, there will be a presumption that the company will receive a declination absent aggravating circumstances involving the seriousness of the offense or the nature of the offender. (emphasis added)
In delivering remarks on the new policy, Assistant Attorney General Kenneth A. Polite noted that the presumption will not apply when aggravating circumstances exist. He stated -
Namely, even if aggravating circumstances are present, although a company will not qualify for a presumption of a declination, under the revised CEP I am announcing today, prosecutors may nonetheless determine that a declination is the appropriate outcome, if the company can demonstrate that it has met each of the following three factors:
• The voluntary self-disclosure was made immediately upon the company becoming aware of the allegation of misconduct;
• At the time of the misconduct and the disclosure, the company had an effective compliance program and system of internal accounting controls that enabled the identification of the misconduct and led to the company’s voluntary self-disclosure; and
• The company provided extraordinary cooperation with the Department’s investigation and undertook extraordinary remediation.
Each of these factors is familiar. That is by design. We are requiring companies seeking the possibility of a declination—even in the face of aggravating factors—to take extraordinary measures before, during, and after a Criminal Division investigation to earn such an outcome. This possibility is directed squarely at companies that take compliance and good corporate citizenship seriously.
Although the DOJ has moved to individual accountability years back, this new policy offers more of a carrot to companies who provide the evidence or assist the government is obtaining the evidence against individuals. AAG Polite stated:
Our number one goal in this area – as we have repeatedly emphasized – is individual accountability. And we can hold accountable those who are criminally culpable—no matter their seniority—when companies come forward and cooperate with our investigation.
It will be interesting to follow whether this new incentive to companies will provide for more prosecutions of individuals, and in turn result in more deterence with respect to corporate criminality.
More tomorrow on other interesting aspects of this new policy.