USDOJ Revisits Its Approach to Corporate Cases

On November 29, the Justice Department announced changes to its policy toward corporate prosecutions.

These changes pivot from the ones announced three years ago that emphasized the prosecution of people, not just organizations. Among other things, they had required an organization that sought to cooperate with the government to identify all individuals involved before it would receive any credit for its cooperation.

Much remains the same, but now, an organization can receive some credit for identifying everyone who was “substantially involved” in the wrongdoing, even if it hasn’t identified every last culpable person. It may even receive full credit in doing so. But either way, the government will not hold up its case against an organization just to run down people who were not substantially involved and are not likely to be prosecuted.

In civil cases, an organization can receive credit if it “meaningfully assists” in the government’s investigation, and prosecutors can again negotiate individual releases of liability as part of the settlement. The aim is to help the government resolve cases, recover money, reimburse victims, and reward companies that cooperate. But a company gets no credit if it covers up for senior management or the board of directors or otherwise shows a lack of good faith. And to earn maximum credit, it must identify everyone who was substantially involved.