The Department of Justice’s top priority is fighting fraud and misconduct in order to protect the financial system and the citizens it serves. There are many challenges to determining who was responsible for the corporate misconduct. In a recent memorandum titled Individual Accountability for Corporate Wrongdoing, the Deputy Attorney General of the DOJ released six steps in order to show common procedures taken in an investigation of corporate misconduct.
To be eligible for any cooperation credit, corporations must provide the DOJ all relevant facts about the individuals involved in corporate misconduct. The company must completely disclose all relevant facts about the misconduct. The company cannot pick and choose and must disclose all individuals involved, regardless of their position, status, or seniority.
Both criminal and civil corporate investigations should focus on individuals from the inception of the investigation. By focusing on the wrongdoers, the DOJ is maximizing ability to uncover the full extent of corporate misconduct and increases the likelihood that individuals with information will cooperate with the investigation.
Criminal and civil attorneys handling corporate investigations should be in routine communication with one another. Constant communication between criminal and civil attorneys promotes the most thorough and appropriate resolution in every case
Absent extraordinary circumstances, no corporate resolution will provide protection from criminal or civil liability or the company. Department lawyers should not agree to a corporate resolution that includes an agreement to dismiss charges or provide immunity for and individuals or employees.
Corporate cases should not be resolved without a clear plan to resolve related individual cases before the statute of limitations expires and declinations as to individuals in such cases must be memorialized. If the investigation has not concluded by the expected time, there should be a discussion of the potentially liable individuals, a description of the current status, and the investigation that still needs to be done.
Civil attorneys should consistently focus on individuals as well as the company and evaluate whether to bring suit against an individual based on considerations beyond that individual’s ability to pay. Not only does the DOJ want all the funds returned to the government, but also wants to hold individuals accountable and deter them from future misconduct.