A new policy announced by Deputy Attorney General Rod J. Rosenstein modifies how penalties may be assessed by the Department of Justice (“DOJ”) regarding the pursuit and prosecution of white collar corporate crimes on both domestic and international fronts.
The new policy aims to encourage coordination between DOJ component units and other enforcement agencies when imposing penalties for the same conduct. Specifically, DOJ is now discouraging what is often termed as “piling on.” As explained by Deputy Rosenstein, “[i]n football, the term ‘piling on’ refers to a player jumping on a pile of other players after the opponent is already tackled.” He noted, “[p]iling on can deprive a company of the benefits of certainty and finality ordinarily available through a full and final settlement.” Deputy Rosenstein continued, “[w]e need to consider the impact on innocent employees, customers, and investors who seek to resolve problems and move on.”
The new policy contains four key hallmarks:
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The federal government’s criminal enforcement authority should not be used against a company for purposes unrelated to the investigation and prosecution of a crime.
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DOJ departments are required to coordinate with one another, thus requiring credit and apportionment of penalties, fines, forfeitures and other means of avoiding disproportionate punishment.
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All attorneys within DOJ will be encouraged to coordinate with other federal, state, local and foreign enforcement authorities seeking to resolve a case with a company for the same misconduct.
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The policy sets forth several factors which DOJ attorneys may evaluate in determining whether multiple penalties will serve the interest of justice. These factors include the egregiousness of the wrongdoing, statutory mandates regarding penalties, risk of delay in finalizing the resolution, and adequacy and timeliness of the company’s disclosures and cooperation.
While the new policy will be important for companies and corporate actors, it does not provide a private right of action but rather acts as an important guide for DOJ actions and decisions.
Furthermore, when discussing the penalty assessment aspects of a prosecution Deputy Rosenstein placed a particular emphasis on DOJ’s commitment to rewarding companies who develop compliance programs. According to Deputy Rosenstein, “the Department should reward companies that try in good faith to deter crime.” Such deterrence “means developing corporate compliance programs that help prevent problems in the first instance, and that detect problems and stop them from spreading.”
