The Criminal Division's Enforcement Policy: What's New for Companies Deciding Whether to Voluntarily Disclose?

Is it better to conduct an investigation, remediate the problem, discipline the wrongdoer, beef up the company's compliance program and stay silent, keeping the company out of the DOJ's crosshairs and the spotlight of the media? Or is it better to take the high road of the good corporate citizen and self-report, knowing that it could result in a sharp drop in the stock price, the filing of shareholder suits, bad publicity and — if the disclosure was not to the DOJ's satisfaction — criminal charges? Even publicly traded companies that have regulatory disclosure obligations find themselves having to wrestle with these issues when the misconduct does not necessarily rise to the level of a material event. Prior guidances by the DOJ — usually announced by the Deputy Attorney General (DAG) — provided some assistance, but not enough.

2022 DAG Directive to Publish Written Corporate Enforcement Policies

On Sept. 15, 2022, DAG Lisa Monaco, in her memo announcing revisions to the DOJ's Corporate Enforcement Policies (CEPs), directed each DOJ component that prosecutes corporate crime to review its policies on voluntary self-disclosure. If a formal, written policy did not exist—as it does for the FCPA Unit of the Frauds Section — that unit or division had to craft and publicly share its new written policy. See, J. Wolff & E. Jogerst, "DOJ's Revised Corporate Prosecutions Policy: Deputy Attorney General Lisa Monaco's September 2022 Memorandum Ups the Ante," https://bit.ly/3RV3HGJ