U.S. Department of Justice Announces Revised FCPA Corporate Enforcement Policy
In a move to incentivize “ethical corporate behavior,” the Department of Justice has announced a revised Foreign Corrupt Practices Act Corporate Enforcement Policy. The new policy formalizes the DOJ’s 2016 Pilot Program that was designed to encourage companies to voluntarily disclose FCPA-related misconduct by providing greater information about the benefits of such a disclosure.
Specifically, the new policy creates a presumption that the DOJ will decline to bring enforcement actions when a corporation self-discloses, fully cooperates, remediates any misconduct and disgorges any unlawful profits. Previously, under the Pilot Program, a declination was merely an option for the DOJ to exercise; now such a declination is mandatory under specific circumstances. However, this presumption exists only where there are no aggravating circumstances that would make a declination inappropriate. Examples of aggravating circumstances include, for example, significant profit to the company from the misconduct, involvement of the company’s executive management in the misconduct, and criminal recidivism.
Additionally, even if aggravating circumstances exist, a company may still find some reprieve under the new policy. In these circumstances, the new policy requires the DOJ to recommend a 50 percent reduction off the low end of the Sentencing Guidelines fine range. Similarly, where a company fully cooperates and timely and appropriately remediates, but does not voluntarily self-disclose, the company will be eligible for a 25 percent reduction off the low end of the Sentencing Guidelines fine range.
Finally, the new policy defines the scope of the “deconfliction” of internal investigations – that is, a request from the DOJ for companies to defer interviewing their employee witnesses until after the government has had an opportunity to do so. While the Pilot Program introduced the idea of deconfliction, the new policy outlines specific limitations to such a request, including that it be limited in duration and narrowly tailored to a legitimate investigative purpose.
It should be noted that while the new policy provides greater transparency regarding the DOJ’s decision-making process with respect to the FCPA, there are no guarantees. The policy preserves a measure of prosecutorial discretion and makes clear that it does not create any enforceable rights in a court of law.