In a recent speech, Marshall Miller, principal associate deputy attorney general, emphasized consistency, predictability, and transparency in the Department of Justice’s (DOJ) approach to corporate enforcement, particularly in relation to national security.
Speaking at the Global Investigations Review in New York September 21, Mr. Miller spoke to themes central to DOJ's Corporate Enforcement, highlighting where enfocement is headed.
"If you’ve been following our message on corporate crime in the last year, I trust one thing has come through loud and clear: the Department is placing a new and enhanced premium on voluntary self-disclosure (VSD)."
Miller said that the DOJ emphasis on VSD, aims for a consistent approach across all its components. "For the first time, all 94 U.S. Attorneys’ Offices have now adopted a single Voluntary Self-Disclosure policy," Miller said.
Companies that voluntarily disclose wrongdoings could receive more lenient treatment, exemplified by the case of Corsa Coal Corporation, whichearlier this year received a declination from the Criminal Division and the U.S. Attorney’s Office for the Western District of Pennsylvania, despite having used bribes to secure $143 million in coal contracts from an Egyptian state-owned company through bribes paid by a third-party intermediary.
They received a declination from prosecution because they "stepped up and owned up."
On the issues of mergers and acquisitions (M&A), Mr. Miller discussed how the DOJ is striving to avoid penalizing companies that acquire others with a history of misconduct, provided they engage in careful due diligence and remediation.
"The Criminal Division’s Corporate Enforcement Policy also offers the incentive of the prospect of a declination – in essence, a safe harbor – for misconduct reported to the Department that is uncovered during pre- or post-acquisition due diligence."
The Criminal Division’s Corporate Enforcement Policy also offers the incentive of the prospect of a declination – in essence, a safe harbor – for misconduct reported to the Department that is uncovered during pre- or post-acquisition due diligence.
"The Safran declination from December 2022 is a great example. There, the company voluntarily self-disclosed that two companies it acquired paid a consultant to win contracts with the Chinese government, knowing that some of the money would be used to bribe senior officials.
"The conduct ended prior to the acquisition, Safran timely voluntarily self-disclosed, cooperated, and remediated, and the company thus secured a declination with disgorgement."
"It’s important also to highlight the enormous gulf between the outcomes for companies that do the right thing – that step up and own up – and the consequences for companies that do the opposite."
Mr. Miller emphasized that companies not abiding by deferred prosecution agreements (DPAs) and non-prosecution agreements (NPAs) would face serious consequences, citing the case of Ericsson as a high-profile example where the company had to pay additional penalties for failing to honor its commitments under a DPA.
"Put simply, Ericsson failed to live up to its commitments. The company failed to timely disclose requested and highly relevant documents related to the bribery scheme at the time of resolution; and it failed to timely disclose additional evidence and allegations of other potential FCPA violations. And so it paid the price."
Earlier this year Justice rolled out a pilot program related to compensation systems, aimed at incentivizing good behavior within companies. "Every corporate resolution involving the Criminal Division will require that the resolving company include compliance-promoting criteria within its compensation and bonus system," he said.
The national security implications of corporate activities are central, according to Mr. Miller. He said companies are on the "front lines" of national security issues, such as sanctions, money laundering, and export control laws.
The majority of corporate criminal resolutions since his return to the department have involved national security, with this number doubling from 2022 to 2023. "The trend is real, it is accelerating, and at DOJ we’re dedicating the resources necessary to counter the threat," Miller warned.
"National security laws must rise to the top of your compliance risk chart, with the recognition that even the most innocuous-looking transaction or activity could implicate our collective security."
Lastly, Miller stressed the importance of collaboration between the private sector and government, particularly in the areas of cyber and crypto-enabled crimes and national security compliance risks. He encouraged the private sector to work closely with the DOJ to identify and mitigate these risks.
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