DOJ announces new policy guaranteeing declination for self-reporting companies
The US Department of Justice’s Criminal Division will guarantee declinations for companies that voluntarily self-disclose criminal conduct and meet key cooperation requirements under a new corporate enforcement policy, Division head Matthew R Galeotti announced Monday at the Securities Industry and Financial Markets Association.
Speaking at SIMFA’s Anti-Money Laundering and Financial Crimes Conference, he said companies meeting core requirements—voluntary self-disclosure, full cooperation, timely remediation, and no aggravating circumstances—will not be required to enter into a criminal resolution. ‘This is a clear path to declination.’
Galeotti framed the changes as part of refocusing DOJ resources on ‘the most serious threats’ and prosecuting criminals rather than law-abiding businesses. He said the goal is to let companies focus on innovation and prosperity.
The policy changes under the revised Corporate Enforcement and Voluntary Self-Disclosure Policy represent a significant shift from previous enforcement approaches that Galeotti said had deterred corporate cooperation. ‘Too often, businesses have been subject to unchecked and long-running investigations that can be costly—both to the Department and to the subjects and targets of its investigations—and can unduly interfere with day-to-day business operations,’ he said.
For companies that self-disclose but may have aggravating circumstances, the revised policy makes clear that they may still be eligible for a CEP declination based on weighing the severity of those aggravating circumstances and the company’s cooperation and remediation.
Companies that self-disclose after the Department has become aware of the misconduct are still eligible to receive significant benefits—a non-prosecution agreement with a term of fewer than three years, 75% reduction of the criminal fine, and no monitor.
‘Where a company does not self-disclose, it will not receive these benefits,’ Galeotti warned.
The Criminal Division is also reducing its use of corporate monitors, with Galeotti noting that ‘the value monitors add is often outweighed by the costs they impose, so you can expect to see fewer of them going forward’. For pre-existing monitorships, the Criminal Division is reviewing each one in an effort to narrow their scope or terminate altogether.
The Division has also expanded its corporate whistleblower programme to include procurement and federal programme fraud; trade, tariff, and customs fraud; violations of federal immigration law; and violations involving sanctions, material support of foreign terrorist organisations, or those that facilitate cartels and transnational criminal organisations.
