DOJ Reinstates and Augments Prior Corporate Criminal Enforcement Policies: Now Requiring Disclosure of ALL Involved Individuals and Consideration of ALL Prior Corporate Misconduct

On October 28, 2021, Deputy United States Attorney General Lisa Monaco issued a memorandum marking the first major announcement on corporate criminal enforcement from the Department of Justice (“DOJ”) under the Biden Administration (“Monaco Memo”). Most notably, this memorandum: (1) reinstates the Individual Accountability Policy originally announced in the Yates Memo and (2) guides prosecutors to look at all prior misconduct, not just those instances similar to the misconduct at issue in the present investigation.

The Individual Accountability Policy requires companies to provide relevant non-privileged information on all individuals “involved in or responsible for the misconduct at issue” before prosecutors can award cooperation credit. In 2018, the DOJ modified this policy to encompass only those individuals substantially involved in the criminal conduct. Now, companies must disclose as to all involved individuals, not just those believed to be substantially involved. In a speech at the ABA’s 36th National Institute on White Collar Crime on October 28, 2021, Monaco reasoned that the “substantially” standard was unworkable because it left too much to corporate interpretation. This policy also requires disclosures on those inside and outside the organization. Therefore, companies must disclose information even on those individuals whom fall outside the company’s control and oversight.

The Monaco Memo also shifts the way in which the DOJ assesses a corporation’s history of misconduct when making charging decisions. Previously, prosecutors looked at a corporation’s prior misconduct similar to the conduct under investigation. Going forward, however, prosecutors will consider all historical misconduct “whether or not that misconduct is similar to the conduct at issue in a particular investigation.” Monaco explained that by focusing only on similar acts, the previous guidance failed to “fully consider a company’s overall commitment to compliance programs and the appropriate culture to disincentivize criminal activity.” This broadened approach allows prosecutors to examine instances of misconduct from all angles, including “any prior domestic or foreign criminal, civil, or regulatory enforcement actions against it.” This includes not only prior misconduct by the target company but also by its “parent, divisions, affiliates, subsidiaries, and other entities within the corporate family.”

The Monaco Memo provides prosecutors with enhanced and broadened tools to determine whether to grant cooperation credit and when make charging decisions. Therefore, these policies will have a significant impact on future corporate investigations and prosecutions.

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The opinions expressed on this blog are those of the author and are not to be construed as legal advice.

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