United States Deputy Attorney General (DAG) Lisa Monaco recently gave a speech in which she outlined both new policies at the Department of Justice (DOJ) as well as enhancements to existing ones that can have a profound effect on compliance and ethics programs.
To better understand both what she said and what it all means we sat down with DOJ veteran Daniel Kahn (LinkedIn), a partner in the Washington, DC office of Davis, Polk & Wardwell, for an in-depth and longer than usual podcast. He explains that while the emphasis on individual accountability is not new, there is a significant change. The Department expects that individual prosecutions will take place prior to or at the same time as corporate resolutions. Given the extra time it often takes to prosecute an individual, that will make it harder for organizations to reach a swift conclusion and move forward.
There is also one other significant change in terms of how individuals are treated: the Department is now looking to see if the organization is clawing back compensation from employees who committed wrongdoing, at least in those jurisdictions where it is permitted.
When it comes to leniency, the Department had previously stated that repeat offenders were not likely to receive a Non-Prosecution Agreement (NPA) or a Deferred Prosecution Agreement (DPA). The DAG’s latest comments reflected a more nuanced approach and reflect the idea that all incidents are not created equal, and that in a large organization it is possible for more than one violation to occur over time, without it being a sign of dysfunctionality.
Other notable elements of her comments:
- The Department expects that when an organization seeking cooperation credit comes across hot new evidence it will share it with Justice immediately
- For the first time there will be policies on voluntary disclosures across all the various departments within Justice
- There will be a presumption against a guilty plea if a company voluntarily self-discloses, cooperates and remediates
- Non-Disparagement Agreement clauses will be looked at unfavorably if they interfere with whistleblowing
One other notable element of her talk, which was, perhaps, lost in most discussions about her comments, is the call for organizations to getter a better handle on messaging by employees on their personal devices.
Finally, Dan addresses what some perceive as a slowdown in corporate prosecutions over the last few years. He notes that during the Obama and Trump administration there was an uptick in cases. Any slowdown over the last two years is likely the results of changes in leadership at the DOJ with a new Administration. Bottom line is that now is not the time to assume the DOJ is not active.
Listen in to learn more about what you should take away from DAG Monaco’s comments.