July 13, 2020

Volume X, Number 195

July 13, 2020

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DOJ Announces Possible Expansion of Corporate Self-Disclosure Policy

On March 1, 2018, at the American Bar Association’s National Institute on White Collar Crime, top Department of Justice (DOJ) officials signaled expansion of DOJ’s self-disclosure policy to non-Foreign Corrupt Practices Act (FCPA) cases.  John Cronan, acting assistant attorney general for the DOJ Criminal Division, and Benjamin Singer, chief of the DOJ Securities and Financial Fraud Unit, both spoke at the conference and commented DOJ may seek to apply the policies set forth in the FCPA Corporate Enforcement Policy to non-FCPA corporate crimes.

In November 2017, Deputy Attorney General Rod Rosenstein announced DOJ’s new FCPA Corporate Enforcement Policy, which was memorialized in the United States Attorney’s Manual.  This policy, though non-binding, provides internal guidance to DOJ prosecutors in matters involving companies who self-disclose violations of the FCPA.  Most notably, the Corporate Enforcement Policy announced a presumption towards declination for companies that self-disclose, cooperate with DOJ and remediate.  For an in depth discussion of the FCPA’s Corporate Enforcement Policy, see "DOJ Announces a New FCPA Corporate Enforcement Policy."

DOJ has once again signaled its desire to encourage self-disclosures and cooperation.  During presentations at the White Collar Crime conference, Cronan and Singer both discussed DOJ’s policy for rewarding self-disclosures.  “When a company discovers misconduct, quickly raises its hands and tells us about it, that says something.  It shows the company is taking misconduct seriously and not willing to tolerate it and we are rewarding those good decisions,” remarked Cronan.  Singer cautioned the approach taken by his DOJ Securities and Financial Fraud Unit is not a formal policy.  However, he went on to say, “The idea was maybe we can take some of those same principles that led to a little bit more self-reporting recently in the FCPA space to securities and financial fraud.”

In highlighting this new approach, Cronan and Singer touted a recent declination issued against Barclays PLC for illegal front-running.  DOJ’s letter agreement with Barclays explained the declination decision was fueled by Barclays’s voluntarily disclosure; cooperation with DOJ; and remediation measures, including restitution and disgorgement totaling close to $13 million.  According to Cronan, DOJ’s approach to Barclays “would have been very different if Barclays had not voluntarily self-disclosed, cooperated and remediated.”  Singer contrasted the Barclays case with a recent case involving HSBC PLC.  HSBC did not self-disclose, Singer noted, and ended up paying a $100 million penalty and was subjected to a deferred prosecution agreement.

Deputy Attorney General Rosenstein spoke the following day at the conference, March 2, 2018, where he briefly discussed the new FCPA Corporate Enforcement Policy.  Specifically, he emphasized DOJ’s desire to “reward companies that invest in strong compliance measures.”  He did not comment on applying the policy to non-FCPA cases.

© 2020 Dinsmore & Shohl LLP. All rights reserved.National Law Review, Volume VIII, Number 68


About this Author

D Michael Crites, white collar criminal defense lawyer, Dinsmore Shohl, law firm

D. Michael Crites’ practice focuses exclusively on white collar criminal defense and complex business litigation. As the former United States Attorney for the Southern District of Ohio and an Assistant United States Attorney for the Southern District of Ohio, he has years of grand jury and litigation experience in federal court and regularly litigates and negotiates global settlements of criminal, civil and regulatory matters on behalf of corporations and businesses throughout the United States. He also serves as Special Counsel to the Ohio Attorney General.

MIchael Ferrara, Dinsmore, trial and appellate lawyer, litigation, white collar crime, false crimes act, Columbus, Ohio, Government investigations,

Michael is a former federal prosecutor and experienced trial and appellate lawyer who focuses his practice on white collar criminal defense, internal investigations and False Claims Act litigation as a member of Dinsmore’s Litigation practice group. Prior to joining Dinsmore, he spent a decade as an assistant U.S. attorney in Chicago, where he served as the deputy chief of the narcotics section and lead attorney of a strike force which targeted organized crime for the U.S. Attorney’s Office for the Northern District of Illinois. In these roles, Michael handled and oversaw complex fraud matters and managed the office’s international money laundering and cartel prosecutions, leading teams of lawyers and investigators in years-long investigations of multi-billion dollar criminal enterprises.

In his time as a federal prosecutor, Michael gained substantial experience in litigation, trials and appellate work throughout the country, including the investigation and prosecution of a cyber-fraud organization which defrauded more than one million victims of over $100 million, criminal fraud matters related to parallel False Claims Act proceedings, and the prosecution of the leadership structure of the Sinaloa Cartel. He built his reputation as a respected, hands-on investigator by working with a wide variety of federal, state and foreign investigative and regulatory authorities. He successfully briefed and argued cases to the Seventh and Eighth Circuit Courts of Appeals, including matters of the First Amendment and complex evidentiary and federal sentencing guidelines issues.

He knows what clients facing investigations, subpoenas, trials and appeals should expect. He guides them through each process step by step, ensuring they know what to expect and counseling them on the best way to proceed along the way.

He is a graduate of Loyola University of Chicago School of Law, where he also served as an adjunct professor for more than a decade. Earlier in his career, Michael was local prosecutor in Chicago, where he specialized in forensic sciences while assigned as an assistant state’s attorney in the Cook County State’s Attorney’s Office’s cold case homicide unit.

Mathew G Drocton, litigation, commercial litigation, Dinsmore, Columbus, Ohio, Honorable John J McConnell

Mathew is a member of the firm’s Litigation Department, where he focuses his practice on commercial litigation.

Prior to joining Dinsmore, he began his career working in complex commercial litigation for an Am Law 200 firm in Columbus. He also clerked for the Honorable John J. McConnell on the United States District Court for the District of Rhode Island.