Late last month, Deputy Attorney General Lisa O. Monaco delivered a keynote speech at the ABA’s National Institute on White Collar Crime event in Washington, DC. Her remarks outlined observed trends in white collar crime as well as AG Merrick Garland’s and her priorities and initial action items for combatting corporate crime. Corporate defense and in-house counsel, take note.
DAG Monaco started by sharing her observations of trends in white collar crime and confirming that the Department’s overarching goal remains unchanged: to “protect jobs, guard savings and maintain our collective faith in the economic engine that fuels this country.”
She then turned to the Department’s renewed commitment to holding individuals—not just corporate entities—accountable for corporate malfeasance. While this has been a Department priority for some time (see Yates Memo), DAG Monaco also outlined concrete steps the Department is taking to execute on this priority.
First, she announced that she is encouraging all prosecutors to bring cases against individuals who profit from corporate misconduct even in cases the government might lose: “fear of losing should not deter” prosecutors so long as “the admissible evidence will probably be sufficient to obtain and sustain a conviction.” (Emphasis added.) Noting that corporate entities will continue to be prosecuted alongside the individuals, she warned that it would be very costly for a company not to invest in a robust compliance program “or worse, thumb its nose at compliance” if that led to becoming the target of a government investigation.
Particularly important for corporate defense counsel and in-house lawyers to consider are the three action items announced in the speech, which DAG Monaco characterized as “first steps”:
- She restored guidance that, in order to receive cooperation credit, companies must share all non-privileged information about every individual involved in and/or responsible for the misconduct, rather than limiting such disclosure to those the company deems “substantially involved.”
- Prosecutors are now directed to consider all of the company’s criminal, civil, and regulatory enforcement history (federal, state, local, and foreign) in determining a proper resolution with a corporation, rather than just its record of similar misconduct.
- She rescinded guidance that corporate monitors should be disfavored in resolutions, instead encouraging prosecutors to require independent corporate monitors whenever they believe it is appropriate to satisfy them that the company is making the necessary changes.
Finally, DAG Monaco announced the formation of a Corporate Crime Advisory Group made up of representatives from different components within DOJ. The Group would have a broad mandate to review, among other things, how the Department accounts for companies with a history of repeated corporate wrongdoing and, in particular, whether Non-Prosecution Agreements or Deferred Prosecution Agreements are appropriate for companies who have previously received one.
Speaking directly to corporate defense counsel and in-house lawyers, DAG Monaco ended her speech with five tips for companies considering her announcements:
- Companies should actively review their compliance programs to ensure adequate monitoring and remediation;
- Companies under investigation should expect that prosecutors will review their entire criminal, civil and regulatory history;
- Cooperating companies must identify all individuals involved in the misconduct;
- There will be no longer be a default presumption against corporate monitors; and
- This is only the beginning of the reforms, i.e., stay tuned!
Read the full remarks here.