Faced with a decline in the number of corporate criminal prosecutions over the last decade, a top Justice Department official on Thursday unveiled new sweeteners for companies that cooperate with the government and a $250 million Congressional budget request to expand its work.
Every division that prosecutes corporate crime must now develop programs to incentivize companies to report misconduct, Deputy Attorney General Lisa Monaco said in a speech at New York University Law School. In some cases, no one will have to plead guilty to criminal charges if the violation was self-reported and the company fixed it.
The Justice Department’s top priority is prosecuting individuals who commit corporate crime, she said. She pointed to companies like Theranos, whose disgraced CEO Elizabeth Holmes was convicted on felony counts earlier this year.
“We will hold those who break the law accountable, regardless of their position, status, or seniority,” Monaco said.
Companies will also be required to come forward more quickly with evidence of suspected misdeeds to get leniency, and could eventually be rewarded for clawing back money from executives that break the law.
The new policies include alluring carrots for companies, but if they’re not accompanied by the stick of increased enforcement they may not have a big impact, so the $250 million request is a key piece, said Julian Andre, a former federal prosecutor who is now in private practice with the Los Angeles-based firm McDermott Will and Emery.
“Corporate prosecutions are still declining,” he said. “Until the DOJ devotes substantial additional resources to pursuing these time-intensive and complex investigations … many companies may still decide that voluntary disclosures are not in its best interests.”