On January 17, 2023, Assistant Attorney General Kenneth A. Polite Jr., announced revisions to the U.S. Department of Justice’s (DOJ) Corporate Enforcement Policy (CEP) intended to provide specific, additional incentives to companies for voluntary self-disclosures, as well as for cooperation and remediation.
These revisions apply to all corporate criminal matters handled by the DOJ’s criminal division, including all Foreign Corrupt Practices Act (FCPA) cases nationwide. The DOJ’s prior policy provided that if a company voluntarily self-disclosed, fully cooperated, and timely and appropriately remediated, there was a presumption that the DOJ would decline to prosecute absent certain aggravating circumstances. Assistant AG Polite noted that this prior policy sometimes led companies to conclude that it was more prudent not to self-disclose misconduct because the existence of aggravating factors might prevent the company from obtaining a declination. Under the new policy, even in instances where
aggravating factors are present, prosecutors may nonetheless determine that a declination is the appropriate outcome if the corporation had an effective compliance program and system of internal accounting controls at the time of the misconduct and disclosure, voluntarily self-disclosed, and provided extraordinary cooperation with the DOJ’s investigation following disclosure.
Another notable change is that the revised guidelines provide incentives for companies that do not voluntarily self-disclose but still fully cooperate and timely and appropriately remediate. In such cases, the DOJ will recommend up to a 50% reduction off the low end of the Sentencing Guidelines fine range.
After outlining these potential incentives for corporations that cooperate with the DOJ, Assistant AG Polite stressed that "a corporation that falls short of our expectations does so at its own risk. Make no mistake – failing to self-report, failing to fully cooperate, failing to remediate, can lead to dire consequences."
Assistant AG Polite concluded his remarks by stating that the DOJ’s message to corporate citizens was that the DOJ remained "committed to incentivizing companies to detect and prevent crime in their own operations, and to come forward and cooperate with [the DOJ] when they identify criminal wrongdoing."
In response to these corporate enforcement revisions, corporations should prepare accordingly – including by evaluating their current compliance programs to ensure that they give an adequate opportunity to come forward, cooperate, and remediate when wrongdoing is discovered.
If there are any questions, Calfee is ready to help.
PDF
