Companies accused of corporate crimes will have more incentives to disclose misconduct they uncover and cooperate with federal investigations, Assistant Attorney General Kenneth Polite Jr. said Tuesday.
In remarks at Georgetown University’s law school, Polite seemed to soften the Biden Administration’s corporate criminal enforcement stance and offer more carrots in the government’s “carrot-and-stick” policies in the form of fewer prosecutions and softer penalties.
Polite’s comments amount to the first major change to the DOJ Criminal Division’s corporate enforcement policy since it was announced in 2017 and provides federal prosecutors with more freedom to decline to prosecute companies in some cases.
The changes also make it clear that a robust compliance culture isn’t just nice to have, said Tom Fox, FCPA expert and compliance podcast host.
“There is much more pressure and attendant benefit for having an effective compliance program at the time of the incident. The DOJ will now measure compliance program effectiveness by whether your compliance program detected illegal conduct through reporting or internal controls.”
Previously, declinations applied only when companies voluntarily self-disclosed misconduct,…
