The Coat of Arms of the US Department of Justice (DOJ) is seen at its headquarters in Washington, DC, the United States, on May 10, 2021.
Andrew Kelly | Reuters
The way federal prosecutors handle white collar crime cases will change significantly, with a greater focus on individual executives who commit fraud, a senior Justice Department official said Thursday.
According to the official, the DOJ is changing the incentive structure for companies that deal with the government on cases of corporate wrongdoing. The government will give credit to companies that provide information and names of individual executives involved in criminal activities, the official said.
“The timeliness of information about key individuals will be a key metric for prosecutors assessing what credit companies receive for their cooperation,” the official said. “If the company comes forward, people can go to jail and that’s the intent here. But the company itself can avoid a guilty plea on behalf of its shareholders.”
The department also plans to make it significantly more difficult for companies to obtain back-to-back no-tracking agreements. Now prosecutors weigh the full spectrum of a company’s past behavior when making decisions about resolutions.
“Historically, there have been concerns that some companies view resolutions with the Department of Justice as a cost to doing business and believe that multiple back-to-back agreements to not prosecute or to defer prosecution are possible,” the official said. “We’re trying to send a message that’s not the case.”
And the DOJ will also emphasize recovering executive compensation so that when a company foots the bill for a fine, the executives who committed the fraud pay a price, not just the company’s shareholders.
New rules are also expected for corporate compliance monitors, who are often tasked with making sure companies continue to do their best in the wake of misconduct.
Assistant Attorney General Lisa Monaco will present the new guidelines Thursday night at New York University.