DOJ Expands FCPA Declination Policy To Other Criminal Matters

What Happened

The Department of Justice suggested last month that it will decline prosecution in corporate criminal matters in which the corporation engages in voluntarily disclosure.

The Rundown

On February 28, 2018, DOJ sent a letter declining to prosecute Barclays in connection with crimes involving a foreign exchange front running scheme.  Though several Barclays executives were charged, DOJ declined to prosecute the corporation.  Barclays had agreed to pay back $13.9 million in profits after cooperating with DOJ in an extensive investigation of the alleged wrongdoing.

The declination signals a policy shift toward presuming declination in cases where the corporation voluntarily discloses, which is DOJ’s default position in all FCPA matters.  John Cronan, the acting head of DOJ’s Criminal Division and Benjamin Singer, chief of the securities and financial fraud unit confirmed the move, telling attendees at the ABA’s white collar conference in the beginning of the month that DOJ will use the FCPA Corporate Enforcement Policy as nonbinding guidance in other criminal cases.  Pursuant to that policy, unless certain aggravating factors are present, DOJ will decline to prosecute corporations who cooperate and proactively disclose and remedy FCPA issues.

For the Record 

In the declination letter to Barclays, Deputy Attorney General Rod Rosenstein wrote that one aspect of DOJ’s commitment to “finding effective ways to ensure that individual wrongdoers are held accountable for corporate criminal behavior . . . is to punish the people who make or knowingly participate in decisions that violate the law” but the Department also wants “to avoid imposing penalties that disproportionately punish innocent employees, shareholder, customers and other stakeholders.”