Risk Management

Feds Clarify New White-Collar Crime Policy

To earn cooperation credit, a 'corporation does need to produce all relevant facts,' said Deputy Attorney General Sally Quillian Yates.
Matthew HellerNovember 17, 2015
Feds Clarify New White-Collar Crime Policy

Federal white-collar crime prosecutors will give special weight to whether a company discloses possible individual wrongdoing early in evaluating whether it should get any leniency, according to a top U.S. Department of Justice official.

The department has revised its policy manual in response to criticism from lawmakers and public-interest groups that it relied too heavily on big-dollar settlements with companies without prosecuting the individuals responsible for the misconduct.

Deputy Attorney General Sally Quillian Yates clarified those changes in a speech Monday, saying the government doesn’t expect “all or nothing” disclosure of individual wrongdoing.

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“A company won’t be disqualified from receiving cooperation credit simply because it didn’t have all the facts lined up on the first day it began talking with us,” she said at a money laundering enforcement conference in Washington. “Rather, under those circumstances, we expect that cooperating companies will simply continue to turn over the information to the prosecutor as they receive it.”

Yates also said the new policy does not require companies to waive attorney-client privilege. “But to earn cooperation credit, the corporation does need to produce all relevant facts,” she added.

The policy manual recommends that prosecutors only consider a company to have cooperated in an investigation if that company turns over information about the actions of individuals at the firm. “Americans should never believe, even incorrectly, that one’s criminal activity will go unpunished simply because it was committed on behalf of a corporation,” Yates said in September.

Since the manual was changed, Insurance Journal reports, defense lawyers have raised concerns that businesses may be reluctant to come forward if credit for cooperation becomes too difficult to obtain.

“I have a hard time imagining that it will truly be in a company’s best interest to forgo the substantial benefits accorded for cooperation solely to avoid having to provide all the facts about individual conduct,” Yates said Monday.