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Carrots and Sticks: DAG Lisa Monaco Puts Her Stamp on DOJ'S Corporate Criminal Enforcement Policies
Going back many decades, each Deputy Attorney General (DAG) has promulgated revisions to the Department of Justice's corporate criminal enforcement policies, leaving behind eponymous policy memos that were carefully studied by defense attorneys (e.g., the "Holder Memo" and the "Thompson Memo"). Finding an approach that deters corporate wrongdoing and incentivizes corporations to participate in investigations but avoids punishing entire corporations (including their shareholders and employees) for the conduct of a few bad actors has proven to be a perennial challenge. On the one hand, overly lenient policies may fail to incentivize companies to cooperate with investigations and identify wrongdoers. On the other hand, policies that are overly focused on collecting headline-making settlement amounts from corporations may do little to deter wrongdoing by employees, while indictment can amount to a death sentence for a corporation that may ultimately be innocent of the charged crime. This was the case with Arthur Andersen in the early 2000s, an auditing firm unwisely charged by the Enron Task Force with obstruction of justice, a crime that it did not commit. By the time the Supreme Court unanimously reversed the conviction, the scandal had effectively put the firm out of business. See, Arthur Andersen LLP v. United States, 544 U.S. 696 (2005) (reversing trial conviction).
Like her predecessors, Deputy Attorney General Lisa Monaco has been quick to put her stamp on the issue, and on Sept. 15, 2022, she announced a series of revisions to DOJ's corporate criminal enforcement policies and practices. DAG Lisa O. Monaco, U.S. Dep't of Justice, Remarks on Corporate Criminal Enforcement, (Sept. 15, 2022) (September 2022 Remarks); Memorandum, Dep't of Justice, Further Revisions to Corporate Criminal Enforcement Policies Following Discussions with Corporate Crime Advisory Group (Sept. 15, 2022) (September 2022 DOJ Memo). The revised corporate criminal enforcement policies focus on four priorities: 1) individual accountability; 2) corporate accountability; 3) independent compliance monitorships; and 4) transparency in corporate criminal enforcement. These revisions expand upon Monaco's 2021 speech and memo in which she announced initial changes to DOJ's corporate criminal enforcement policies and emphasized that there would be more to come. Memorandum, Dep't of Justice, Corporate Crime Advisory Group and Initial Revisions to Corporate Criminal Enforcement Policies (Oct. 28, 2021) (October 2021 DOJ Memo); DAG Lisa O. Monaco, U.S. Dep't of Justice, Keynote Address at ABA's 36th National Institute on White Collar Crime (Oct. 28, 2021) (October 2021 Remarks). Deputy Attorney General Monaco described her latest policy revisions as "a combination of carrots and sticks," and "a mix of incentives and deterrence," designed to "empower[] companies to do the right thing — and empower[] [DOJ] prosecutors to hold accountable those that don't." September 2022 Remarks.
Notably, these revisions come at a time when white-collar prosecutions are at an historic decades-low. See, White-Collar Crime Prosecutions for 2021 Continue Long Term Decline, Transactional Records Access Clearinghouse (Aug. 9, 2021). Whether this trend is due to decreased enforcement, meaningful changes in corporate culture, or some combination is an open question. Fighting against this downward trend, Monaco reiterated again that white-collar enforcement is a top DOJ priority and that the new policy was intended to "make clear that [DOJ] won't accept business as usual." September 2022 Remarks. In this article, we review the policy revisions and ask whether and how they will change current DOJ practices in white-collar enforcement.
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