Last September, the U.S. Department of Justice issued a policy memo to its prosecutors urging them to demand evidence against employees “regardless of their position, status or seniority” from companies that are under investigation for corporate fraud or other white collar crime.
The renewed focus on prosecuting executives and other employees for white collar offenses is an acknowledgement of criticism the Justice Department and Attorney General Loretta E. Lynch have received about the lack of prosecution of individuals allegedly responsible for corporate white collar crime.
“Corporations can only commit crimes through flesh-and-blood people,” said Sally Q. Yates, the DOJ's deputy attorney general in an interview with the New York Times. “It's only fair that the people who are responsible for committing those crimes be held accountable. The public needs to have confidence that there is one system of justice and it applies equally regardless of whether that crime occurs on a street corner or in a boardroom.”
Yates, who authored the memo entitled, “Individual Accountability for Corporate Wrongdoing,” laid out six steps for its prosecutors to strengthen their pursuit of executives for corporate crime:
To receive any consideration for cooperation from the DOJ, companies must identify all individuals involved in corporate misconduct and provide all relevant facts about their involvement.
Prosecutors must focus on individuals from the beginning of any investigation.
Absent any extraordinary circumstances and other than in antitrust cases, no corporate resolution will provide protection to individuals for civil or criminal liability.
No corporate case may be resolved without a clear plan for the resolution of related individual cases, and a high-level DOJ official must approve any waiver of individual prosecution.
Routine communication between prosecutors and civil attorneys pursuing corporate investigations is expected.
Civil attorneys should focus on individuals as well as a company and any decision on whether or not to file suit against an individual should be based on considerations beyond that individual's ability to pay civil fines.
Although the Justice Department has collected billions of dollars in fines in the last few years, it has been roundly criticized for not holding executives responsible for corporate wrongdoing. In her memo, Yates said the Department faces substantial challenges in pursuing individuals for corporate misdeeds, and needs a stronger plan for investigating them.
With this new policy now in place, corporations will also need a stronger plan for conducting investigations of potential wrongdoing.
The Cogdell Law Firm is a full service criminal litigation and appellate law firm. We provide client-focused representation at all stages of the process, whether our clients are seeking to avoid charges, have been charged, or are seeking reversal of a conviction on appeal. When results matter most, contact Dan Cogdell at (713) 426-2244 or [email protected]
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